First Nickel Enters Into C$30 Million Project Loan Facility

TORONTO, ONTARIO -- (Marketwire) -- 07/05/11 -- First Nickel Inc. ('First Nickel' or the 'Company') (TSX: FNI) is pleased to announce that it has entered into a credit agreement with respect to a previously announced project financing arrangement with Societe Generale (Canada Branch), as Administrative Agent and Lender and Commonwealth Bank of Australia, as Documentation Agent and Lender for a senior debt facility of up to C$30 million maturing on March 31, 2015 (the 'Facility'). Initial funding under the Facility will be subject to implementation of a hedging program and certain other customary funding conditions set forth in the credit agreement.

The proceeds of the Facility will be used to partially fund the direct and indirect development and start-up costs at the Company's Lockerby Depth Project.

William Anderson, President and CEO of First Nickel, commented, 'We are very pleased to have entered into this arrangement with two major international banks. I believe it is a testament to the calibre of our Lockerby project and the quality of our team'.

About First Nickel

First Nickel is a Canadian mining and exploration Company. Its current activities are primarily focused on the Sudbury Basin in northern Ontario, the location of the company's redevelopment stage property (the Lockerby Mine) and two of its exploration properties. First Nickel also has exploration properties in the Timmins region of northern Ontario and the Belmont region of Eastern Ontario. First Nickel's shares are traded on the TSX under the symbol FNI.

Some of the statements contained in this news release are forward-looking statements, such as statements that describe First Nickel's future plans, intentions, objectives or goals, and specifically include but are not limited to future production and the completion of conditions precedent of the Facility. In certain cases, forward-looking statements can be identified by the use of words such as 'expects', 'will', 'enable', 'anticipates', 'estimated' or words of similar effect. Since forward-looking statements are not statements of historical fact and address future events, conditions and expectations, forward-looking statements inherently involve unknown risks, uncertainties, assumptions and other factors well beyond the Company's ability to control or predict. Actual results and developments may differ materially from those contemplated by such forward-looking statements depending on, among others, fluctuating metal prices, maintaining operating and exploration teams, and other factors described in the Company's most recently filed Annual Information Form under the heading 'Risk Factors' which has been filed electronically by means of the System for Electronic Document Analysis and Retrieval ('SEDAR') located at www.sedar.com. The forward-looking statements included in this document represent First Nickel's views as of the date of this document and subsequent events and developments may cause First Nickel's views to change. These forward-looking statements should not be relied upon as representing First Nickel's views as of any date subsequent to the date of this document. Although First Nickel has attempted to identify important factors that could cause actual actions, events of results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Readers should not place undue reliance on any forward-looking statements.

Contacts:

First Nickel Inc.

William Anderson

President & CEO

(416) 362-7050

(416) 362-9050 (FAX)
wanderson@firstnickel.com