Mirabela Nickel - 30% increase in Santa Rita resource - Planned increase in size

Nick Poll, Managing Director of Mirabela, said the results moveMirabela's primary Measured and Indicated Resource to 90 million tonnes at0.60% Ni and reaffirm Santa Rita's status as one of the world's largest newsources of nickel. An additional 10.7 million tonnes of Inferred Resourcegrading 0.60% Ni also lies within open pit limits.

"This is a substantial increase in resources, which further cements SantaRita's position as one of the largest and most exciting new discoveries ofnickel sulphide for many years and takes the project to the next level interms of potential nickel production," Mr Poll said.

Mr Poll said Mirabela was working to deliver increased productioncapacity at Santa Rita. "Studies are already underway to increase capacityfrom the current 4.6 mtpa capacity to above 6.0 mtpa within the first year ortwo of operations. This would result in production of more than 25,000 tpa ofnickel in concentrate, up 35% from the currently planned capacity."

"Annual production of 25,000t of nickel and a mine life of at least 17years will make Mirabela the largest independent nickel producer in the worldand there are only a handful of producers that can source this amount ofproduction from one open-cut mine," Mr Poll said. "This is encouragingMirabela to look even harder at downstream processing options, such as asmelter, to capture as much value as it can from the resource base," Mr Pollsaid.

The strength of the resource at depth is encouraging plans for possibleunderground mining operations to augment the open pit. The Company hascommenced a new drilling program to prove up deeper resource with undergroundpotential and studies are underway to determine the best underground miningmethods and likely costs.

"Santa Rita has the low capital and operating costs associated with Nisulphides, but the size normally associated with Ni laterite projects. We arenow targeting a total resource of over one million tonnes of contained Ni. Theproject is permitted and under construction, with commissioning expected inmid 2009. With the resource continuing to increase, further expansion of themill and the potential addition of a smelter give Santa Rita excellent growthpotential," said Mr Poll.

Primary Resource

The updated Potential Mill Feed Resource (this is the estimated resourceavailable as mill feed based upon a pit optimisation study) is:

               Primary Resource - Potential Mill Feed Estimate                       (indicative strip ratio 7.6:1)    -------------------------------------------------------------------------    Category             Million       Ni         Cu       Tonnes    Million                          Tonnes                             Ni       lbs Ni    -------------------------------------------------------------------------    Measured                 8.8      0.68%      0.17%     60,000        130    -------------------------------------------------------------------------    Indicated               81.2      0.60%      0.16%    480,000      1,060    -------------------------------------------------------------------------    Measured + Indicated    90.0      0.60%      0.16%    540,000      1,190    -------------------------------------------------------------------------    Inferred                10.7      0.60%      0.17%     64,000        140    -------------------------------------------------------------------------    Includes 5% ore loss. Weighted average cut-off grade - 0.36% Ni. See    Attachment 2 below.    

In additional to the increase in tonnes, a higher proportion of theresource is hosted by pyroxenite (up from 41% to 58%). This increases theexpected average Ni recovery from 67% to 70%, as the pyroxenite unit has lessnon-recoverable (silicate) nickel. This is a substantial added benefit fromthe recent drilling.

Pit optimisation studies for the Santa Rita resource were undertaken byindependent consultant Croeser Pty Ltd using the following parameters:

    -   The operating costs from the bankable feasibility work announced July        2007 increased by 16% (representing an 11% reduction in the long term        exchange rate to US$:2.00 Real and a 5% general cost escalation)    -   Latest pit slopes as recommended by Brazil-based geotechnical        consultants VOGBR    -   A nickel price of US$7.00/lb    Secondary Resource    In addition to the Primary Resource (average cut-off 0.36% Ni) there is ahalo of lower grade mineralisation (average cut-off 0.26% Ni) within the samepit shell. This lower grade mineralisation is free at surface as it is minedas waste when the Primary Resource is mined.              Secondary Resource - Potential Mill Feed Estimate                    (within same pit as Primary Resource)    -------------------------------------------------------------------------    Category             Million       Ni         Cu       Tonnes    Million                          Tonnes                             Ni       lbs Ni    -------------------------------------------------------------------------    Measured + Indicated    38.2     0.31%       0.07%    118,000        260    -------------------------------------------------------------------------    Inferred                 3.4     0.29%       0.08%     10,000         20    -------------------------------------------------------------------------    Includes 5% ore loss. Weighted average lower cut-off grade 0.26% Ni and    upper cut-off grade 0.36% Ni. See Attachment 2 below.    

Similar operating costs as in the bankable feasibility results announcedJuly 2007 are applicable to the Secondary Resource except that the mining costis nil and the royalty and concentrate transport costs per tonne are reducedin proportion to the lower recovered Ni per tonne (i.e. reduced by 63%). Theestimated average Ni recovery for the Secondary Resource is about 50%, whichreflects a higher percentage of non recoverable (silicate) Ni in lower gradematerial.

Potential Underground Resource

A substantial part of the Primary Resource upgrade is derived from therecently discovered zone of mineralisation known as the southern high gradezone. This zone appears to have good continuity below 200m vertical depth andalong 240m of strike averaging 88m true width and 0.79% Ni. Approximately 80%of the southern high grade zone mineralisation is hosted by the preferredpyroxenite unit. The zone remains open at depth. There is also undergroundresource potential beneath a central high grade zone where about 140m ofstrike averages 42m true width and 0.77% Ni.

These widths and grades are likely to be economic for bulk undergroundmining. Any depth extension of these zones below open-pit limits has thepotential to add a significant underground resource to the Santa Rita project.The Company is now targeting this underground resource potential and recentlycommenced a new drilling program to test depth extensions in these areas.

An underground resource is likely to be mined towards the end of theexisting project and blended with the Secondary Resource to keep the Milloperating at full capacity. The Secondary Resource thereby alleviates the needto mine an underground resource at the full annual throughput rate. Thiscombination has the potential to add considerable life to the Santa Ritaproject.

Drilling To Date

The following table summarizes the diamond drilling at Santa Ritacompleted to date:

    -------------------------------------------------------------------------    Santa Rita resource                  Drill holes   Approx meters drilled    -------------------------------------------------------------------------    Oct 2006 resource estimate                   244                  56,000    June 2007 resource estimate                  313                  73,500    Latest Nov 2007 resource estimate            378                  93,750    Total resource drilling to date              426                 106,900    -------------------------------------------------------------------------    

This includes recent holes in the newly discovered South-East Extensionarea where excellent results were recently announced. Drilling is alsocontinuing underneath the southern high grade zone where, given the consistent80m+ intersections, the pit is likely to drive deeper, and even deeperdrilling in this area recently commenced to prove up potential undergroundresource. Also, further drilling is planned for the southern end of theSouthern zone where existing drilling is not yet deep enough to test potentialpit limits.

The Company believes additional Southern deeps, South-East Extension andunderground resource drilling is likely to add significant further resource.Drilling is ongoing with 5 diamond drilling rigs on-site.

Updated Santa Rita Resource Targets

The recent favourable drilling results have lead to a revision in thetarget size of the Santa Rita project. The Company's ongoing drilling programsare now targeting the following:

    -------------------------------------------------------------------------    Santa Rita                     Grade     Current      Target      Target                                                (mt)        (mt)  (Ni tonnes)    -------------------------------------------------------------------------    Primary Resource (In-pit)      0.60%          90        120+     720,000    Secondary Resource (In-pit)    0.31%          38         50+     155,000    Underground Resource           0.75%         nil         30+     225,000    Total                          0.55%         128        200+   1,100,000    -------------------------------------------------------------------------    

The Underground Resource is purely a conceptual target. It requirescontinuity of the southern high grade zone at similar widths and grades for afurther 500m below the pit limits. This is yet to be drill tested.

Increase in Size and Scope of the Santa Rita Project

This resource upgrade, and the potential for more resource, increases thescale and scope of the Santa Rita project. The Company now intends toconstruct the Mill with a throughput of 4.6 mtpa (previously the Mill was tobe commissioned at 4.0 mtpa and then increased within 12 months). Further, theCompany is now planning to increase the Mill throughput to 6.0+ mtpa withinone to two years of commissioning. The Mill will be designed to allow for suchan expansion.

The Company will release updated capital and operating cost numbers forthe 4.6 mtpa Mill shortly. A preliminary estimate of the Mill expansioncapital cost will also be released in due course.

With Santa Rita having a potential mine life of over 30 years at 6 mtpathroughput, the economic imperatives of constructing a smelter on-site arestronger than ever. The Company has adjusted the smelter scoping study byincreasing the planned throughput to 230,000 tonnes of concentrate pa. Thesmelter would convert Santa Rita concentrates grading about 12% Ni into amatte grading 50-60% Ni, thereby attracting a higher payability andsubstantially reducing transport costs.

A possible option for the Company is to construct the smelter in jointventure with an established smelter operator and this partner would thenpurchase the matte off-take. This would mitigate the financial and technicalrisks of the smelter project, whilst providing the Company with savings onconcentrate transport costs and participation in the smelter. Under currentplanning, the smelter would be commissioned about two years after the Milltaking advantage of the established infrastructure of the existing project.

The Company is working closely with WorleyParsons to undertake moredetailed studies into this concept and will announce results of this work asthey come to hand.

    Updated Global Mineral Resource    The updated mineral resource estimate for Santa Rita is:    <<                          Mineral resource estimate    -------------------------------------------------------------------------    Category             Million       Ni         Cu       Tonnes    Million                          Tonnes                             Ni       lbs Ni    -------------------------------------------------------------------------    Measured                11.0       0.62       0.15     68,000        150    -------------------------------------------------------------------------    Indicated              125.2       0.51       0.13    638,000      1,400    -------------------------------------------------------------------------    Measured + Indicated   136.2       0.52       0.13    706,000      1,550    -------------------------------------------------------------------------    Inferred                20.7       0.52       0.14    107,000        235    -------------------------------------------------------------------------    Weighted average cut-off grade - 0.26% Ni. See Attachment 2 below.

    (signed)                          (signed)    Nick Poll                         Craig Burton    Managing Director                 Corporate Director    >>

Lauritz Barnes and Brett Gossage have sufficient experience which isrelevant to the style of mineralization and type of deposit underconsideration and to the activity which he is undertaking to qualify as aCompetent Person as defined in the 2004 Edition of the 'Australasian Code forReporting of Exploration Results, Mineral Resources and Ore Reserve' and areeach a Qualified Person in accordance with NI 43-101. Lauritz Barnes and BrettGossage consent to the inclusion in the report of the matters based on theirinformation in the form and context in which it appears.

The information in this report that relates to pit optimization andscheduling studies is based on information compiled by Roselt Croeser who is aMember of The Australasia Institute of Mining and Metallurgy. Roselt Croeseris a consultant to Mirabela Nickel Limited. Roselt Croeser consents to theinclusion in the report of the matters based on his information in the formand context in which it appears.

All other technical information in this report has been reviewed byNicholas Poll, who is a Member of The Australasia Institute of Mining andMetallurgy. Nicholas Poll is the Managing Director of the Company. NicholasPoll consents to the inclusion in the report of the matters based on hisinformation in the form and context in which it appears.

Caution Regarding Inferred Resources: Inferred resources are, bydefinition, of insufficient confidence to have economic considerations appliedthat would enable them to be categorised as mineral reserves, and there is nocertainty that any preliminary assessment will be realised in respect of suchresources. In the present case, the Inferred resources comprise about 11% ofthe total resource estimate.

Caution Regarding Forward Looking Statements: The forward-lookingstatements made in this announcement are based on assumptions and judgments ofmanagement regarding future events and results. Such forward-lookingstatements, including but not limited to those with respect to resourcetargets or the development of a mine and/or a smelter at Santa Rita and theCompany's capital expenditures and estimated future production involve knownand unknown risks, uncertainties, and other factors which may cause the actualresults, performance or achievements of the Company to be materially differentfrom any anticipated future results, performance or achievements expressed orimplied by such forward-looking statements. Such factors include, amongothers, the actual market prices of nickel, the actual results of currentexploration, the actual results of future mining, processing and developmentactivities, changes in project parameters as plans continue to be evaluated,as well as those factors disclosed in the Company's filed documents.

Attachment 1: Technical background on resource estimate

The resource has been classified in accordance with Canadian Institute ofMining, Metallurgy and Petroleum (CIM) guidelines and with reference to thecriteria set out in the Australasian Code for Reporting of ExplorationResults, Mineral Resources and Ore Reserves (JORC Code, December 2004). Theestimation has been carried out by a Competent Person from the Company and aCompetent Person from Coffey Mining Pty Ltd in accordance with the Code and assuch is suitable for inclusion in a public report.

In total, the grade interpolation dataset used for the resource estimateconsisted of 378 diamond holes. All drill core has been logged in detail forlithological and structural information. Nickel and multi-element assaying hasbeen completed on half core samples using inductively coupled plasma atomicemission spectroscopy (ICP-AES) and inductively coupled plasma massspectroscopy (ICP-MS) methods with appropriate collectors (for example 30gfire assay for Pd, Pt and Au). All assaying is accompanied by rigoroussubmission and analysis of QAQC samples. An extensive specific gravitydatabase has been collected by weighing of diamond core in air and water.

The resource model was derived via geological and mineralisation zonemodelling of the deposit. Estimation involved the application of OrdinaryKriging in panels of 20m E-W by 25m N-S by 5mRL for Ni, Cu, Co, Pd, Pt, Au,Fe, Mg and S with Uniform Conditioning change of support for Ni only for abase case selective mining unit of 5mE by 10mN by 5mRL. Technique selectionwas based on the quantity and spacing of available data, and the interpretedcontrols on, and styles of, mineralisation under review.

Attachment 2: Details on cut-off grades used

A variety of cut off grades are required for each ore type, because theyvary in olivine content. Olivine contains non-sulphide nickel that is notrecoverable (silicate nickel), so lower olivine content increases nickelrecovery and reduces the corresponding cut-off grade. Mineral resource gradesreflect the combined sulphide and silicate nickel content, because assaytechnology is not accurate enough to measure sulphide nickel content alone formineral resource estimation.

There are four different types of mineralised rock. Each has a differentcut-off grade depending on its non-sulphide nickel content. Pyroxenite has alow cut-off grade to reflect low olivine and low non-sulphide nickel content,whereas dunite has a high cut-off grade to reflect high olivine and highnon-sulphide nickel content. The table below provides a breakdown of theresource rock types, their associated cut-off grades and a comparison with theprevious (June 2007) estimate.

       Comparison of cut-off grades between new and previous potential mill                                feed tonnages    -------------------------------------------------------------------------                            November 2007 estimate        June 2007 estimate                          ---------------------------------------------------    Host rock type         Percentage      Cut-off   Percentage      Cut-off                          composition        Grade  composition        grade    -------------------------------------------------------------------------    Pyroxenite                     58        0.32%           41        0.35%    Olivine Orthopyroxenite        14        0.35%           15        0.40%    Harzburgite                    25        0.45%           40        0.40%    Dunite                          3        0.50%            4        0.50%    Weighted average     cut-off grade               100%        0.36%         100%        0.38%    -------------------------------------------------------------------------    In addition, a lower resource cut-off grade has been used as set outbelow:                       Details for lower cut-off grade    -------------------------------------------------------------------------                                                Lower cut-off grade resource                                                -----------------------------    Host rock type                                   Percentage      Cut-off                                                    Composition        grade    -------------------------------------------------------------------------    Pyroxenite                                               58        0.22%    Olivine Orthopyroxenite                                  13        0.25%    Harzburgite                                              26        0.35%    Dunite                                                    3        0.40%    Weighted average cut-off grade                         100%        0.26%    -------------------------------------------------------------------------    

For further information

Nick Poll, Managing Director, Telephone: +61 89324 1177, Facsimile: +61 8 9324 2171, Email: