Shares in Western Areas were slightly higher after the company extended an offtake deal with China's Jinchuan Group on improved terms.
The company will sell 26,000 tonnes of nickel in concentrate (FOB Esperance) to Jinchuan over the next years, following a competitive tender process that attracted bids from several parties.
Western Areas said the detailed terms of the new agreement with Jinchuan would remain confidential but the two parties were finalising documentation based on minimal changes to the existing contract.
Western Areas managing director Daniel Lougher said the company had been selling nickel concentrate to Jinchuan since July 2010.
"The new contract commences in February 2013 and contains improved payability terms for Western Areas over the existing agreement," he said.
"Western Areas was encouraged by the strong competition for its nickel sulphide concentrate, which supports our view that there is a looming shortage of quality nickel concentrates in the market."
Western Areas produces 25,000-26,000 tonnes of nickel in concentrate a year, selling its product to Jinchuan and BHP Billiton Nickel West.
Western Areas shares were up two cents to $4.39 at 9am.