Hanna pointed to the achievements of the Barminco mining team and the company's Perth-based staff, which have seen the project progress from discovery to mine in a period of just three years.

Hanna added that first production had been achieved at a time of record highs in the nickel price, with initial production from Flying Fox unhedged.

"From day one, the mine has been set up for long-term production. T Zero is only the first of four deposits discovered at Flying Fox to date that are planned to be mined from the same decline," Hanna said

The company has previously said it is looking to produce around 1000t of nickel in concentrate by the end of the year.

The full-year production estimate for 2007 of 4000t of contained nickel is expected to double by 2008. An aggressive production ramp up plan will then see the mine produce around 13,500t by 2010, according to the company.

The first high-grade massive sulphide nickel ore was taken from the southern part of the T Zero deposit, the first of four deposits at Flying Fox to be accessed by the same decline.

Western Areas is also seeking to develop a second mine, Diggers South, where a positive feasibility study has indicated the potential to add 4000-5000t of nickel in concentrate to the company's production profile.

"Western Areas plans to evaluate advanced project and corporate acquisitions to drive further shareholder value," the company said.

Shares in the company were trading at an all-time high of $3.74 this morning, up 4c (1.1%) on yesterday's closing price.