Mustang Minerals Corp.
TSX VENTURE : MUM

Mustang Minerals Corp.

November 15, 2006 08:00 ET

Western Areas Announces C$5 Million Placement With Mustang Minerals to Advance the Maskwa Nickel Deposit Towards Open Pit Production

TORONTO, ONTARIO--(CCNMatthews - Nov. 15, 2006) - The Boards of Directors of Australian based Western Areas NL (TSX:WSA)(ASX:WSA) and Mustang Minerals Corp. ("Mustang")(TSX VENTURE:MUM) are pleased to announce that they have entered into a private placement agreement for an investment of up to C$5 million in Mustang. The agreement is subject to regulatory approvals and completion of due diligence by Western Areas.

Mustang intends to use the majority of the proceeds from the placement to complete a feasibility study for an open pit mine at the Maskwa Nickel Deposit ("Maskwa").

Maskwa is the principal asset of Canadian-based Mustang. The 100% owned Maskwa deposit is located 150km from Winnipeg Manitoba in an area of well established infrastructure including roads, rail and power. A scoping study is in progress for an open pit mine. Maskwa contains an Indicated Mineral Resource of 6.0 million tonnes at 0.74% nickel and 0.15% copper containing approximately 44,480 tonnes of contained nickel (98,060,000 pounds of nickel) that is Canadian National Instrument 43-101 compliant.

Open pit mining at Maskwa was previously carried out by Falconbridge subsidiary Maskwa Nickel Chrome Mines Limited between 1974 and 1976. Maskwa Nickel mined 332,000 tonnes of ore at an average grade of 1.2% nickel and 0.2% copper. In addition, 1.54 million tonnes averaging 0.8% nickel and 0.3% copper was mined at the nearby Dumbarton underground mine, also on the Mustang property.

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.

Discussion

Commenting on the agreement, Mr. Julian Hanna, Managing Director of Western Areas said, "This investment in Mustang offers Western Areas exposure to one of the most promising nickel projects in Canada.

We have reviewed many nickel opportunities outside Australia and believe that the Maskwa deposit has strong potential to be the next nickel mine developed in Canada in an area with well established infrastructure and excellent exploration upside."

The agreement positions Western Areas to become an internationally diverse company and complements the company's existing growth strategy through building interests in advanced nickel projects with potential for significant expansion of future production.

Mustang President, Mr Robin Dunbar stated "Western Areas is one of the leading mid size nickel companies globally and we welcome them as a strategic partner as we move towards development of this significant mineral resource."

Mustang also has a resource estimate pending from the M2 Zone at the Mayville Property located approximately 35km north of Maskwa where it is targeting bulk tonnage nickel /copper mineralization. A corporate profile of Mustang can be viewed on Mustang's website.

Summary of Agreement Terms

Under the terms of the private placement agreement, Western Areas will acquire 8,571,429 common shares of Mustang at C$0.35 per share representing $3 million and an initial 13% interest in the outstanding capital of Mustang. Western Areas will also acquire 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.

Western Areas will be entitled to nominate a director to the Mustang Board and a right to maintain its 19.9% interest in Mustang.

Mr. Robin Dunbar, the President and a director of Mustang is also a non executive director of Western Areas. The private placement agreement was approved by the independent directors of both companies.

Peter Wood P.Eng (ON) is the Qualified Person for purposes of National Instrument 43-101 and has reviewed the contents of this release.

About Mustang

Mustang Minerals Corp. (TSX VENTURE:MUM) is a Toronto, Canada based nickel explorer with market capitalization of approximately CDN $22 million. Mustang's core nickel asset is the Maskwa Nickel Deposit where it is completing a preliminary economic assessment. Mustang is also completing a resource calculation on the M2 Zone at the Mayville Property located 35 km north of Maskwa.

Other property assets of Mustang Minerals include a joint venture for platinum-palladium with Impala Platinum Holdings Ltd. on its River Valley Project located east of Sudbury, Ontario, a 100% interest in the East Bull Lake Platinum-Palladium Nickel-Copper project west of Sudbury, a 100% interest in the Bannockburn Nickel Project located near Timmins, Ontario and a shareholding interest of approximately 1.8 million shares in Aquila Resources Inc.

About Western Areas

Western Areas is an Australian based nickel sulphide explorer and producer. The company has a current market capitalisation of approximately A$570 million. Western Areas is one of only two nickel companies listed on both the Australian and Toronto Stock Exchanges. (ASX & TSX code: WSA)

The company's core asset is the 100% owned Forrestania Nickel Project, located 400km east of Perth, Western Australia.

The primary discovery, Flying Fox, is one of the highest grade nickel mines in the world. The current Indicated Mineral Resource comprises 1.2m tonnes at 6.6% nickel containing approximately 76,090 tonnes nickel plus an Inferred Mineral Resource which comprises 0.2 m tones at 6.6% nickel containing approximately 12,870 tonnes nickel.

Underground production from the first of a number of high grade deposits at Flying Fox, T Zero, commenced on 26 October 2006.

A pre-feasibility study is also well advanced to bring a second mine into production at Diggers South, 40km south of Flying Fox. If positive, Diggers South has the potential to add approximately 5,000 tonnes of nickel in concentrate per annum to overlap Flying Fox production which is anticipated will ramp up to 12,000 tonnes of nickel in concentrate.

Exploration continues to remain a top priority for Western Areas. The recently completed A$45 million rights issue has provided additional funding for exploration, with a number of high priority targets to be tested along strike from Flying Fox, along the eastern nickel belt at Forrestania and at WSA's other exploration projects.

Near-term upside potential exists through the definition of extensions to the Flying Fox T Zero and T5 deposits beyond the area drilled to date as well as by the definition of economic mineralization at T4. Value should also be achieved by developing the high grade ore reserves at Flying Fox which are expected to deliver a positive cash cost profile that will ensure healthy long-term operating margins.

Western Areas plans to evaluate other advanced nickel projects and corporate acquisitions to drive further shareholder value.

Western Areas QA-QC STATEMENT: Mr Adrian Black from geological consultants Newexco Services Pty Ltd ("Newexco") is responsible for the verification and quality assurance of the Company's exploration data and analytical results from the Forrestania Nickel Project. Surface diamond drill hole collar surveys used differential GPS, downhole surveys employed a north seeking gyroscopic instrument; comprehensive density database; high assay confidence with systematic QA/QC procedures; and validated database. Samples of quarter core from the drill holes are prepared and analysed by ALS Chemex Ltd laboratory in Perth for nickel, copper, cobalt and other elements. Core samples are crushed and pulverised to 90% passing 75 microns then analysed for nickel by ore grade determination using the ALS OG-62 method. Assays standards are routinely inserted in the sample stream by Newexco for quality control.

Western Areas COMPETENT PERSONS STATEMENT: The information within this report was compiled by Mr Julian Hanna who consents to the inclusion in the report of the matters based on this information in the form and context in which it appears. This announcement does not include reference to all available information on the Company or the Forrestania Nickel Project and should not be used in isolation as a basis to invest in Western Areas. Any potential investors should refer to Western Area's other public releases and statutory reports and consult their professional advisers before considering investing in the Company.

FORWARD LOOKING STATEMENT: This release contains certain forward-looking statements. These forward-looking statements are subject to a variety of risks and uncertainties beyond the Company's ability to control or predict which could cause actual events or results to differ materially from those anticipated in such forward-looking statements.

Shares Outstanding: 52,600,186

The TSX Venture Exchange has not reviewed and does not accept responsibility for the contents of this press release.

Contact Information