Continental Nickel Limited

Continental Nickel Limited

December 10, 2007 08:00 ET

Continental Nickel Announces the Second Batch of Assays From the Nachingwea Nickel Project, Tanzania

New Discovery at Zone J: 2.59% Ni and 0.41% Cu over 17.95 meters New Discovery at Zone L: 2.40% Ni and 0.50% Cu over 15.25 meters including 4.66% Ni and 0.91% Cu over 4.35 meters

TORONTO, ONTARIO--(Marketwire - Dec. 10, 2007) - Continental Nickel Limited (TSX VENTURE:CNI) ("CNI" or "the Company") is pleased to announce results from the second batch of assays from its 70% owned Nachingwea nickel sulphide project in Tanzania. The Nachingwea project is a 70:30 JV with Goldstream Mining NL ("Goldstream") of Australia. Fifty-three drill holes totalling 10,514 m have been completed. The assays from the first seven holes were reported on November 20, 2007. In that release, the assays were reported from the first holes at Target H (7.50% Ni and 1.15% Cu over 9.55 m) and Target NAD013 (17.11% Ni and 2.71% Cu over 1.9 m), moreover, that release reported visual sulphide intersections at Targets G, I, J, L and M.

This release describes the results of the second batch of assays from 15 drill holes. The results are listed in the attached table and described herein. Assays are still pending for 31 drill holes. The locations of the various holes are illustrated on the attached figures.

At Target J, drill hole NAD07-030 intersected 17.95 m grading 2.59% Ni and 0.41% Cu. At Target L, drill hole NAD07-039 intersected 15.25 m grading 2.4% Ni and 0.5% Cu, including higher grade intervals of 4.56% Ni and 0.81% Cu over 2.9 m and 4.66 % Ni and 0.91% Cu over 4.35 m.

The 2007 drilling program focussed on testing twelve moderate to high conductance targets delineated in a Crone ground TDEM survey completed earlier this year. The targets range from less than 100 m to greater than 300 m in strike length and are associated with the Ntaka ultramafic intrusion. A map showing the locations of the target areas is attached. These new assay results confirm that Ni sulphide mineralization occurs at targets F, G, I, J, and L. Results are pending for target M.

Zone J was discovered while drill testing a less than 100 m long, moderately to strongly conductive EM anomaly that is coincident with a discrete, 250 m x 500 m magnetic anomaly. The conductor is located near the eastern edge of the Ntaka intrusion approximately 1.5 kilometres northeast of the previously reported NAD013 and H Zones. Nickel sulphide mineralization consisting of disseminated to net textured pyrrhotite, pentlandite and minor chalcopyrite was intersected in NAD07-030 over a core length of 22.8 m below the base of oxidation at a depth of 31.90 m. The average grade of the intersection is 2.17% Ni and 0.35% Cu over 22.80 m including an interval of 2.59% Ni and 0.41% Cu over 17.95 m from 36.75 m and also 5.0 m grading 3.18% Ni and 0.51% Cu from 49.0 m.

Hole NAD07-031, collared at the same location as NAD07-030, was drilled to intersect Target J down dip, however, the zone is apparently displaced by a fault. NAD07-065 and 69 were drilled 20 m along strike to the southeast and intersected 13.15 m to 16.6 m respectively of net textured to massive sulphides, including intervals of massive to semi-massive sulphides over 3.25 m and 7.6 m respectively. Assays are pending for these holes.

The results from Zone J clearly demonstrate that there is potential for thick intervals of high tenor, net textured sulphide, as well as massive sulphide accumulations within the Ntaka intrusion.

At Target L, drill holes tested a 140 m long, highly conductive EM anomaly located 400 m northwest along strike from the high grade NAD013 Zone on the western edge of the Ntaka intrusion. Three drill holes were completed on a single section testing the center part of the conductor. Hole NAD07-37 intersected four zones of closely spaced, narrow, massive sulphides composed of coarse grained pyrrhotite, pentlandite, millerite, and minor chalcopyrite from 53.0 m to 57.5 m. The interval grades 2.82% Ni and 0.55% Cu over 4.50 m. Hole NAD07-39 was drilled approximately 25 m down dip of NAD07-37 and intersected three separate zones of semi-massive to massive sulphide mineralization from 67.15 m to 82.35 m. The average grade of the intersection is 2.40% Ni and 0.50% Cu over 15.25 m including 4.56% Ni and 0.81% Cu over 2.9 m from 67.10 m and 4.66% Ni and 0.91% Cu over 4.35 m from 78.0 m. Hole NAD07-66 was drilled 50 m down dip of the intersection in NAD007-39, but intersected a fault zone at the target depth.

The discovery of Zone L, which consists of multiple zones of high grade massive sulphide similar to that at Zone H and Zone NAD013, emphasizes the excellent potential for high grade mineralization on the western margin of the Ntaka intrusion. Zone L requires further evaluation along its strike length and it will be a priority target in the 2008 drilling program.

Two drill holes were completed at Target I, which is interpreted as a 200 m long, moderately conductive, EM anomaly located 300 m southeast of the newly discovered high grade Zone H. Hole NAD07-029 intersected a 1.05 m interval of net textured to massive sulphide comprised of pyrrhotite, pentlandite and minor chalcopyrite at a down hole depth of 110.25 m. The interval grades 2.34% Ni and 0.42% Cu over 1.05 m. NAD07-32 was drilled 25 m to the north along strike and intersected similar sulphide zones with average grades of 0.97% Ni and 0.27% Cu over 1.4 m from 101.5 m down hole and 1.85% Ni and 0.41% Cu over 1.0 m from 110.0 m. The holes have been surveyed with bore hole EM in order to explore for thicker intervals of sulphide mineralization near the holes in 2008.

At the new Zone H discovery, drill hole NAD07-034 was completed 20 m down dip of NAD-07-028 (7.50% Ni and 1.15% Cu over 9.55 m). The hole intersected two narrow (0.1 m to 0.15 m) massive sulphide zones over a 1.15 m interval which have an average grade of 4.09% Ni and 0.10% Cu over 1.15 m from 95.4 m down hole. Drill Hole NAD07-036 was completed 20 m down dip of NAD07-034 and intersected disseminated sulphides over a 3.05 m interval grading 1.03% Ni and 0.24% Cu from 110.95 m. Assays are pending for three other holes on this target of which two intersected massive sulphide mineralization from less than 0.5 m to 2.25 m in core length.

At Target F, NAD07-023 and 024 tested a 225 m long, moderately conductive, EM anomaly located southwest of the NAD013 Zone. Both holes intersected graphite with weak sulphide mineralization at the modelled conductor depth with no significant assays. However, NAD07-024 intersected the Ntaka ultramafic intrusion and was extended to a depth of 484.6 m to test for a possible basal sulphide accumulation. The drill hole intersected widespread disseminated sulphide mineralization from 364 m down hole. Assays indicate that there is a thick zone of mineralization grading 0.73% Ni and 0.15% Cu over 31.80 m from 396.2 m. Immediately below this zone, a 0.8 m interval of net textured sulphide mineralization was intersected at 433.5 m which grades 3.09% Ni and 2.08% Cu over 0.80 m. Attempts to drill to the base of the intrusion were unsuccessful because of the drill rig capacity and rock quality. Subsequent attempts to survey the hole with borehole EM were unsuccessful because of a blockage in the hole. The hole will be re-entered, cleaned out, and surveyed in 2008.

The first drill holes from Target G have confirmed Ni bearing sulphide mineralization associated with a conductor which has a strike length of 375 m. NAD07-025 intersected a disseminated to semi-massive sulphide zone mixed with graphite from 100.0 m to 110.0 m. Mineralization is mainly pyrrhotite, with minor pentlandite and chalcopyrite. The interval grades 0.76 % Ni and 0.19% Cu over 11.0 m, including 1.14% Ni and 0.25% Cu over 5.0 m starting from 100.0 m down hole. NAD07-027 tested the same target 50 m up dip and intersected weak, mixed graphite-sulphide mineralization, with no significant nickel or copper concentrations. NAD07-035 was drilled 100 m northwest along strike and intersected disseminated, net textured, and semi-massive sulphides at a down hole depth of 100.75 m which graded 1.03% Ni and 0.34% Cu over 8.45 m, including 1.49% Ni and 0.49% Cu over 3.25 m. NAD07-38 was drilled 100 m southeast along strike from NAD07-25 and returned similar mineralization which graded 1.02% Ni and 0.27% Cu over 9.85 m from 132.15 m, including an interval of massive sulphide which graded 3.03% Ni and 0.71% Cu over 1.5 m. Target G has been drill tested along its entire strike length and down dip by ten additional drill holes, a number of which have intersected zones of mixed disseminated to net textured sulphide and graphite zones with narrow intersections of massive sulphide mineralization. Assays are pending. Although the grades are not expected to be high, the target has potential to be a large, low grade sulphide zone.

A 5,900 line-kilometre airborne magnetic / EM survey has been completed over the area surrounding the Ntaka Intrusion. The data collected from this survey will be processed and modelled in order to identify new targets for follow up in the 2008 regional exploration program.

Craig MacDougall, President & CEO of Continental Nickel Limited, reported "The amount and grade of the sulphide mineralization intersected in our first drilling program at Nachingwea indicates that there has been widespread, high tenor, sulphide accumulation in the Ntaka Intrusion. The discovery of Zone J indicates that high tenor sulphide has accumulated on the eastern, as well as the western margins of the intrusion. The new discovery of Zone L underscores the fact that the western margin of the intrusion has abundant sulphide accumulations characterised by very high nickel grades. Accordingly, we feel that there is excellent potential that at least one of the zones that we have discovered in this initial drilling program, will lead to the delineation of a nickel sulphide deposit."

Quality Control

The drilling was completed by Tandrill Limited of Tanzania. Drill core samples (NQ) are cut in half by a diamond saw on site. Half of the core is retained for reference purposes and half is sent for analysis. Samples are generally collected in 1.0 m intervals or less at the discretion of the site geologists. Sample preparation is completed at the ALS Chemex preparation lab in Mwanza, Tanzania. Sample pulps are sent by courier to ALS Chemex laboratory in Vancouver, Canada. Blank samples and commercially prepared and certified Ni sulphide analytical control standards with a range of grades are inserted in every batch of 20 samples or a minimum of one per sample batch. Analyses for Ni, Cu and Co are completed using a peroxide fusion preparation and ICP-AES finish (ME-ICP81). Analyses for Pt, Pd, and Au are by fire assay with an ICP-AES finish (PGM-ICP23).

The quality control, technical information, and all aspects of the exploration program were supervised by Patricia Tirschmann, P.Geo., Vice President of Exploration. Ms. Tirschmann is a qualified person as defined by National Instrument 43-101.

About Continental Nickel

Continental Nickel Limited is an exploration company focused on developing and advancing nickel sulphide exploration projects in geologically prospective, but under explored regions globally. Continental Nickel has 26,942,633 shares issued and outstanding (29,338,415 on a fully-diluted basis) and trades on the TSX Venture Exchange under the symbol CNI.

On behalf of

Continental Nickel Limited

Craig MacDougall, President & Chief Executive Officer

CAUTIONARY STATEMENT: No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. This News Release includes certain "forward-looking statements". All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results, future plans and objectives of Continental Nickel Limited, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from Continental Nickel Limited's expectations are the risks detailed herein and from time to time in the filings made by Continental Nickel Limited with securities regulators.

Summary of Assay Results, Nachingwea Project, Tanzania.

Drill Target Location Az/Dip Hole From To Inte- % Ni % Cu % Co
Hole (local Length rval
(NAD07-) grid) (m) (m) (m) (m)
023 F L4400N, 050/-85 223.9 NSA NSA NSA
024 F L4350N, 050/-85 484.6 396.2 428.0 31.8 0.73 0.15 0.02
2315E 433.5 434.3 0.8 3.09 2.08 0.09
025 G L4500N, 050/-80 181.7 100.0 111.05 11.05 0.76 0.19 0.05
3915E Inclu-
100.0 105.0 5.0 1.14 0.25 0.07
027 G L4500N, 050/-60 214.7 NSA NSA NSA
029 I L3750N, 050/-64 187.5 110.25 111.3 1.05 2.34 0.42 0.11
162.0 176.0 14.0 0.64 0.18 0.03
030 J L4500N, 050/-75 93.1 31.9 54.7 22.8 2.17 0.35 0.07
4240E Inclu-
36.75 54.7 17.95 2.59 0.41 0.08
49.0 54.0 5.0 3.18 0.51 0.10
031 J L4500N, 230/-75 75.8 NSA NSA NSA
032 I L3775N, 050/-60 226.3 101.5 102.9 1.40 0.97 0.27 0.05
110.0 111.0 1.00 1.85 0.41 0.09
033 K L4200N, 050/-75 232.7 NSA NSA NSA
034 H L4100N, 050/-61 139.7 95.4 96.55 1.15 4.09 0.10 0.05
035 G L4603, 050/-84 184.7 100.75 109.2 8.45 1.03 0.34 0.06
3978E Inclu-
100.75 104.0 3.25 1.49 0.49 0.09
036 H L4100N, 050/-73 217.5 110.95 114.0 3.05 1.03 0.24 0.03
037 L L4900N, 050/-55 115.1 53.0 57.5 4.5 2.82 0.55 0.06
038 G L4400N, 050/-83 181.7 132.15 142.0 9.85 1.02 0.27 0.06
3875E Inclu-
132.15 133.6 1.5 3.03 0.71 0.18
039 L L4900N, 050/-72 119.0 67.10 82.35 15.25 2.40 0.50 0.04
2887E Inclu-
67.10 70.0 2.90 4.56 0.81 0.08
74.20 75.8 1.60 1.93 0.79 0.04
78.0 82.35 4.35 4.66 0.91 0.08
(i) Note: Intervals represent core lengths, not necessarily true widths.
Pt, Pd and Au assay results are not reported because in general, they
are less than 1.0 g/t on a combined basis.
(ii) NSA - No Significant Assays

To view the the Nachingwea Property Ntaka Grids, please visit the following link:

To view the the Nachingwea Property Ntaka Grids - West, please visit the following link:

To view the the Nachingwea Property Ntaka Grids - East, please visit the following link:

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

Contact Information