Quadra FNX and Xstrata Nickel to create an access arrangement on the Craig Mine

Paul Blythe, President & CEO comments; “The access arrangement with Xstrata Nickel provides mutual benefits to both parties going forward. We will be advancing the implementation plan in order to shift operations from the Levack #2 shaft to the Craig shaft immediately. This will be a significant step forward in the optimization of our high-grade Morrison deposit.”

The key terms:

• Quadra FNX gains access to the Craig shaft and mine infrastructure for the life of the Levack mine/Morrison deposit
• Quadra FNX will operate the Craig shaft and underground infrastructure but will not undertake mining from Xstrata Nickel’s Craig property. In the event Xstrata Nickel exercises its option to resume operational management of the Craig shaft, it will continue to provide access to Quadra FNX to hoist up to 450,000 tonnes per annum of material from the Levack mine/Morrison deposit
• Quadra FNX will pay Xstrata Nickel:
  • $10 million during the first year of operation
  • $2 million per annum lease fee plus a sliding scale payment per tonne of ore hoisted via the Craig shaft

This arrangement is subject to the finalization of a definitive agreement that provides for these and other terms within 60 days.

The approximately 5,000 foot Craig shaft is connected to Quadra FNX’s Morrison deposit by an access drift on the 4000 level that represents a second access point to its operations, the first being a ramp from the Levack #2 shaft on 2650 Level.

The key benefits:

• Expanded hoisting and haulage capacity at the Morrison deposit allowing the potential for higher throughput and production going forward
• Improved operating flexibility, underground infrastructure, ventilation and power distribution to the lower parts of the Morrison deposit
• Accelerated underground access, development of definition drilling platforms and mine development in the lower portion of the Morrison deposit
• Immediate cost savings related to the cessation of ongoing rehabilitation work on the existing Levack #2 shaft
• Significant improvement in drill access which will facilitate mineral resource delineation (for future conversion to reserves) in the lower portion of the Morrison deposit
• Development of alternative diamond drill platforms which will be used to evaluate additional exploration targets proximal to the Morrison orebody

The arrangement also enables Xstrata Nickel to retain the operational integrity and productive capacity of the Craig infrastructure which has been in a “care and maintenance” state since February 2009.

CONFERENCE CALL DETAILS:

A conference call to discuss the Craig Access Arrangement and Q3 2011 operating results has been scheduled for Friday, October 14 2011, at 11:30am ET (8:30am PDT). The North American toll free number for this conference call is 1-800-355-4959, all other participants please call 1-416-695-6616. The playback version of the call will be available October 21, 2011 at 1-905-694-9451 or North American toll free 1-800-408-3053 and using the pass code: 3086132.

About Quadra FNX Mining Ltd. (TSX:QUX)

Quadra FNX Mining Ltd. is a leading mid-tier copper mining company with corporate offices in Vancouver, B.C. and Toronto, Ontario. Quadra FNX produces copper, nickel and precious metals from its operating mines: Robinson in Nevada, Carlota in Arizona, Franke in northern Chile, and Levack, which includes the Morrison Deposit, Podolsky and McCreedy West in Sudbury, Ontario. The Company has two key development projects: the Sierra Gorda project, a copper-molybdenum project in Chile, and the Victoria project, a polymetallic project in Sudbury, Ontario. Quadra FNX employs approximately 2,500 people in North and South America.

Forward-Looking Statement

This Press Release contains “forward-looking information” that is based on Quadra FNX’s expectations, estimates and projections as of the dates as of which those statements were made. This forward-looking information includes, among other things, statements with respect to the increase in operational flexibility of the Morrison deposit and its impact on production and are dependent on reaching a final agreement with Xstrata Nickel on the terms of a definitive agreement as described in this Press Release. Generally, this forward-looking information can be identified by the use of forward-looking terminology such as “outlook”, “anticipate”, “project”, “target”, “believe”, “estimate”, “expect”, “intend”, “should”, “scheduled”, “will”, “plan” and similar expressions. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause Quadra FNX’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, and developed based on assumptions about such risks, uncertainties and other factors set out herein.