The board of Western Areas has announced that due to continuing high levels of production from the Forrestania Nickel Project, shipments of nickel concentrate to Jinchuan Group in China are already several months ahead of the original schedule.

As a result, the offtake contract to sell a total of 25,000 tonnes of nickel in concentrate to Jinchuan is expected to be completed by February 2012, 19 months after the first shipment to China. Under the current terms, Western Areas and Jinchuan will meet six months before the end of the contract, however Western Areas has no obligation to extend the contract.

Western Areas' board is now considering a range of options including calling for tenders for the next tranche of concentrate from Forrestania. This is in response to strong interest being shown by a number of major offshore nickel producers and other companies.

Western Areas has well established infrastructure and logistics for exporting from Esperance Port including 1300 containers, 25 trucks for transporting containers and an existing shipping contract. Future offtake contracts are likely to be priced FOB from Esperance.

In addition to the contract to sell 25,000 tonnes of nickel in concentrate to Jinchuan, Western Areas has contracts to sell up to 12,000 tonnes per annum nickel in concentrate to BHP Billiton.

Mr Julian Hanna MD of Western Areas said that "Western Areas produces a high quality product sought after by nickel smelters. Our business model is to sell this to a range of customers both domestically and offshore. The early expiry of the Jinchuan contract provides an opportunity to improve already favorable off take terms and potentially find a suitable partner for some of our other exploration and development projects in Australia and Finland."