Australian Mines

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2 April 2008

ASX Announcement

FURTHER HIGH GRADE DRILL RESULTS AT BLAIR NICKEL MINE

Resource upgrade and mine life extension anticipated

Australian Mines (ASX:AUZ) continues to intersect strong high grade nickel mineralisation in its 2008 resource drilling at Blair Deeps at the Blair Mine, located 32 kms from Kalgoorlie in WA.

The second hole in the programme AMUG294, has intersected matrix and massive sulphides in the L03C shoot at the 338mRL (50m below the current deepest workings on L03C shoot) with a downhole intersection of

5.17m @ 4.50% Ni

The third hole (AMUG295) in the programme has intersected both L03C and E03C shoots in 2 locations as detailed below: -

1. The L03C shoot intersection (AMUG295) consisted of matrix sulphides at 335mRL for a downhole intersection of : -

5.50m @ 1.78% Ni

2. The E03C shoot intersection (AMUG295) comprises strong massive sulphides at 314mRL (55m below the current deepest workings on E03C shoot) for a downhole intersection of: -

5.10m @ 9.91% Ni

Further drilling into the E03C, L03C, N03C and C01C shoots at Blair Deeps is continuing, targeting extensions to the high grade shoots at depth.

Hole ID	Northing (m)	Easting (m)	RL (m)	Azi	Dip	Depth (m)	From (m)	To (m)	Length (m)	Ni (%)
AMUG294	6578944	376823	379	272.5	-38.2	131	62.6	67.77	5.17	4.5
AMUG295	6578944	376823	379	267.4	-34.6	138	72.5	78.0	5.50	1.78
							110.0	115.1	5.10	9.91

Table 1 : Blair Deeps – Drill Intercept Table

Australian Mines’ Chief Operating Officer, Mr Brett Young said, “we are very pleased with these further exciting intersections that will result in increases to the reserves and extend the mine life at Blair.

“These encouraging drilling results, in addition to the high grade results from the first drill hole announced last week, indicate the main Blair Deeps orebody remains strong and open at depth. Initial interpretations of the drill results indicate the 03 orebody could be flattening which would result in more tonnes of nickel metal per vertical metre, with further drilling to confirm in the upcoming quarter.”

For further information contact:
Brett Young
Chief Operating Officer
Australian Mines Limited
Tel: 08 9481 5811

For media enquiries contact:
Robert Williams
Farrington National
Tel: 02 9332 4448

The information in this report that relates to Exploration Results is based on information compiled by Mr M Elias who is a Fellow of The Australasian Institute of Mining and Metallurgy. Mr Elias is employed by CSA Australia Pty Ltd and is a Non-Executive Director of AUZ. Mr Elias has sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves.’

Figure1. Blair Mine Cross Section highlighting drill holes AMUG 294 & 295 results marked in yellow.

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