Western Areas NL (WSA.AU) said Tuesday is has signed an additional offtake deal for 2,000 metric tons of nickel in concentrate from Kagara Ltd.'s (KZL.AU) Flying Fox mine with BHP Billiton Ltd. (BHP).

Under the new contract, Western Areas will supply a maximum of 15,000 tons of nickel in concentrate, Western Areas said in a statement.

Western Areas has previously announced an agreement with Kagara to mine the Lounge Lizard deposit, process the ore through the Cosmic Boy plant and sell the concentrate into one of Western Areas' offtake contracts.

The contract will increase the total amount of nickel sold to BHP to 12,000 tons from 10,000 tons. Deliveries are expected to start on completion of a two-year contract to sell 25,000 tons of nickel to China's Jinchuan Group.

-By Elisabeth Behrmann, Dow Jones Newswires;

61-2-8272-4689 elisabeth.behrmann@dowjones.com
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