FNI Arranges Additional US$5.0 Million Loan

TORONTO, ONTARIO--(Marketwire - March 6, 2013) - First Nickel Inc. ("First Nickel" or the "Company") (TSX:FNI) announces that it has entered into a loan agreement with a fund managed by West Face Capital Inc. ("West Face") in the aggregate principal amount of US$5.0 million (the "Loan"). The Loan matures on December 31, 2013 and the proceeds will be used for working capital and corporate requirements. The Loan closed on March 6, 2013 and is subject to the satisfaction of certain post-closing conditions.

Description of the Loan

The Loan is on substantially similar terms to the loan agreement entered into by the Company with Resource Capital Fund V L.P. ("RCF V") announced on January 21, 2013. The Loan will bear an interest rate of 12.0% per annum, paid quarterly in cash or, at West Face's option, common shares of the Company valued at the volume weighted average market price for the five days prior to the date the payment is due. The Loan will be secured by a senior ranking perfected encumbrance over all assets associated with the Company's projects, all shares or equity interests of the Company and all intercompany debt, which security interest will rank pari passu with the security interest of RCF V. In connection with the Loan, a 3.0% Establishment Fee will be paid to West Face in common shares of the Company valued at the volume weighted average market price for the five days prior to the closing date.

Additional Financing

Further to the Company's press releases dated January 3, 2013 and February 7, 2013, FNI will be seeking to restructure outstanding indebtedness and to obtain additional, longer-term sources of financing in the near term in order to improve liquidity and continue the build-out of the Lockerby Mine.

About FNI

FNI is a Canadian mining and exploration company. The Company's mission is to be the most dynamic North American emerging base metal mining company in which to work and invest and to be respected in the communities in which we operate. FNI operates the Lockerby nickel / copper mine in the Sudbury Basin in northern Ontario. In addition to the Lockerby Mine, the Company owns exploration properties in the Sudbury Basin, the Timmins region of northern Ontario, and the Belmont region of Eastern Ontario. FNI's shares are traded on the TSX under the symbol FNI.

Forward-Looking Statements

This news release contains forward-looking statements, which are subject to certain risks, uncertainties and assumptions, including the cash flows, working capital, future financings, metal prices, costs, output, grades, expected development and production, and expected exploration expenditures. A number of factors could cause actual results to differ materially from the results discussed in such statements, and there is no assurance that actual results will be consistent with them. Such factors include fluctuating metal prices, the ability to obtain financing on terms satisfactory to the Company, if at all, lower unit costs and other factors described in the Company's most recent 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. Such forward-looking statements are made as at the date of this news release, and the company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.