Mustang Minerals Corp.

Mustang Minerals Corp.

December 06, 2006 08:00 ET

Mustang Minerals Corp. Completes Financing with Western Areas NL

TORONTO, ONTARIO--(CCNMatthews - Dec. 6, 2006) - Mustang Minerals Corp. (TSX VENTURE:MUM) today announced that it has received the initial C$ 3 million from the private placement agreement announced November 15, 2006 with Western Areas NL. Western Areas is a leading Australian nickel company that is listed on both the ASX and TSX under the symbol "WSA". The principal use of funds by Mustang will be to advance the Maskwa Nickel Project towards feasibility.

The Maskwa Nickel Deposit contains a 43-101 compliant nickel resource. A large part of the Indicated Mineral Resource at Maskwa (5.2 million tonnes at 0.68% nickel and 0.15% copper) is classified as Open Pit Mineralization by independent consultants Roscoe Postle Associates Inc. in a report dated February 18, 2005. The project is located 150 km from Winnipeg, Manitoba in Canada.

Robin Dunbar, President of Mustang Minerals, commented: "we are pleased to have an important strategic shareholder with Western Areas now having invested in Mustang Minerals and the Maskwa project. Mustang will aggressively move forward to progress the Maskwa Nickel Deposit towards feasibility. In addition we are planning new exploration initiatives targeted towards expanding the sulphide nickel resource base in the Bird River project area."

Julian Hanna, Managing Director and Chief Executive Officer of Western Areas, commented: "At a time of extremely strong nickel prices and a lack of new prospective sulphide nickel projects worldwide, we believe an investment in Mustang is attractive at this time given the overall value of the Maskwa resource, the availability of infrastructure and the potential for additional discoveries in the project area. We look forward to assisting in the development of the Maskwa Nickel Project as an important strategic shareholder of Mustang."

Under the terms of the private placement agreement, Western Areas has acquired 8,571,429 common shares of Mustang at C$0.35 per share representing $3 million and an initial 14% interest in the outstanding capital of Mustang. Western Areas has also acquired 4,570,401 warrants. Each warrant will entitle Western Areas to acquire one common share of Mustang at an exercise price of C$0.45 per share until November 14, 2007. If all of the warrants are exercised, Mustang will receive additional proceeds of C$2 million and Western Areas will own a total 19.9% interest in Mustang. Under the subscription agreement Western Areas has also been granted the right to nominate a director to the Mustang Board and a right to maintain its 19.9% interest in Mustang.

Shares Outstanding: 61,171,615

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