Continental Nickel Limited
TSX VENTURE : CNI

Continental Nickel Limited

March 01, 2012 12:15 ET

Continental Nickel Identifies Potential New Zone of Mineralization and Reports Final 2011 Assays at Ntaka Hill Project, Tanzania

TORONTO, ONTARIO--(Marketwire - March 1, 2012) - Continental Nickel Limited (TSX VENTURE:CNI) ("CNI" or the "Company") is pleased to report that nickel sulphide mineralization has been intersected at a new exploration target 350m east of H zone at Ntaka Hill. In addition, final assays have been received for the remaining Sleeping Giant and Ntaka Hill diamond drill holes that were part of the 2011 exploration program (Table I). The project is a 75:25 joint venture between CNI and IMX Resources Limited ("IMX") of Australia.

Highlights

  • New nickel mineralization identified 350m east of H Zone grading 0.52% nickel and 0.11% copper over 20.0 metres

  • In-fill drilling at Sleeping Giant intersects 1.11% nickel and 0.25% copper over 20.4 metres including 2.52% nickel and 0.54% copper over 7.4 metres

  • Additional disseminated nickel sulphide mineralization grading between 0.2% and 0.6% nickel intersected in the hanging wall of the Sleeping Giant zone within April 2011 mineral resource estimate pit shell

  • Updated Ntaka Hill mineral resource estimate expected to be released in early March

Mr. David Massola, President and CEO, commented "The positive results from the 2011 drilling program have expanded the Sleeping Giant Zone and identified new mineralization at the Ntaka Hill area. We are now able to move towards delivering an upgraded mineral resource for the Ntaka Hill Project. The potential new mineralized zone to the east of H zone is a result of evolving exploration concepts following the discovery of the Sleeping Giant zone and we look forward to continuing the drill testing of this area in 2012."

Field activities for the Company's 2011 exploration program were completed in December. A total of 12,981 metres of diamond drilling in 42 holes (including 38 new holes, 1 wedged hole and 3 deepened holes) were completed with the goal of expanding the current estimated mineral resource of the Sleeping Giant zone and to test selected other targets within the Ntaka intrusion. All remaining 2011 assay results for this drilling program have been received. Results for fifteen drill holes are reported herein and are provided below in Table I. A drill hole location figure may be viewed using the link provided with this release.

An additional 500.5 metres of diamond drilling in 5 drill holes was completed on the Chilalo regional exploration license to test selected geochemical and geophysical targets. This drilling was terminated earlier than expected due to heavy rains that restricted road access and will be completed as part of the 2012 regional exploration program. Assay results for the 5 completed holes are expected to be reported later in March.

Exploration Targets South and East of H Zone

Assay results were received for three holes completed to test two exploration targets located east and south of H zone within the Ntaka intrusion. New intervals of nickel sulphide mineralization were intersected in two of these holes and will require additional drilling to more fully test these targets.

Drill holes NAD11-263 and 264 were completed to test a disseminated nickel target located 350m east of H zone. This target was identified from additional drill core sampling of previous holes carried out in 2011 and based on knowledge gained from the Sleeping Giant discovery. The core re-sampling program confirmed intersections of disseminated sulphides in three widely spaced drill holes which returned grades of 0.67% nickel over 10.25 metres (NAD003), 0.44% nickel over 23 metres (NAD004) and 0.60% nickel over 16 metres (NAD07-029). Two new intervals of disseminated sulphide mineralization grading 0.55% nickel and 0.13% copper over 8 metres from 33.0 metres and 0.52% nickel and 0.11% copper over 20.0 metres from 108.0 metres were intersected in hole NAD11-264. These results represent a potential new zone of nickel mineralization.

South of H zone, hole NAD 11-252 was drilled to test a borehole electromagnetic (EM) anomaly located beyond the end of hole NAD08-171EXT which intersected 1.57% nickel and 0.27% copper over 2.85 metres as previously reported (Press Release September 13, 2011). NAD11-252 intersected several zones of disseminated, bleb and net-textured sulphides including 0.56% nickel and 0.15% copper over 9.9 metres from 231.9 metres and 0.40% nickel and 0.11% copper over 14.70 metres from 398.0 metres. A subsequent geophysical survey of this hole detected a borehole EM anomaly that can be correlated with the deeper mineralized zone as well as a new off-hole EM target.

Sleeping Giant Zone

Final assay results were received for twelve additional Sleeping Giant drill holes completed in 2011. Nine of these holes were completed to test for up-dip, up-plunge and down-dip extensions to the zone and three of the holes were drilled as 50 metre center "in-fill" holes to provide additional geological information on selected drill sections.

This drilling resulted in the intersection of additional disseminated sulphide mineralization related to both the Sleeping Giant zone and the adjacent and overlying hanging wall zones. Best results included the 50m in-fill hole, NAD11-258, which intersected disseminated sulphides and several narrow massive sulphide veins grading 1.11% nickel and 0.25% copper over 20.4 metres from 174 metres including a higher grade interval of 2.52% nickel and 0.54% copper over 7.4 metres from 187 metres. The mineralization was intersected more shallowly than expected but is correlated with the Sleeping Giant zone.

The new drilling results will be included in the Ntaka Hill and Sleeping Giant mineral resource estimate update that is expected to be released in early March.

Qualified Persons

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

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. Samples are generally 1.0 metre 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 the ALS Chemex analytical 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 (Analytical Code ME-ICP81). Analyses for Pt, Pd, and Au are by fire assay with an ICP-AES finish (Analytical Code PGM-ICP23).

About Continental Nickel Limited

Continental is focused on the exploration, discovery and development of nickel sulphide deposits in geologically prospective, but under‐explored regions globally. The Company's key asset is its 75% interest in the Nachingwea project in Tanzania, where Measured and Indicated Mineral Resources have been estimated at 4,981,000 tonnes grading 1.22% nickel and 0.24% copper and Inferred Mineral Resources have been estimated at 17,260,000 tonnes grading 0.76% nickel and 0.17% copper (CNI press release April 15, 2011). The project is a 75:25 exploration joint venture between the Company and IMX Resources Limited.

The Company also has an option to joint venture on the St. Stephen project in New Brunswick, Canada where the 2010 and 2011 diamond drill program discovered new Ni‐Cu sulphide zones.

As at the date of this release, the Company has 42,738,508 common shares issued and outstanding (50,244,414 on a fully‐diluted basis) and trades on the TSX Venture Exchange under the symbol CNI.

Table I: Summary of Assay Results
Sleeping Giant Zone and Ntaka Hill, Nachingwea Project, Tanzania
Drill hole
(NAD11-)
Location
East/North
UTM:WGS84
Az /Dip Length (m) From (m) To
(m)
Interval (m) % Ni % Cu Zone
Section 3200N
248* 450327mE
8883200mN
95 / -78 30.35 Hole Abandoned; no assays
250* 450332mE
8883199mN
95 / -78 85.85 29.00 40.00 11.00** 0.24 0.04 HW
259 450254mE
8883200mN
95 / -66 382.75 212.00

293.80

356.00
218.00

297.00

361.20
6.00

3.20

5.20
0.51

0.54

0.34
0.10

0.05

0.06
HW

HW

FW
Section 3300N
246 450328mE
8883300mN
95 / -75 301.38 181.70

235.30

274.10
187.50

243.00

279.00
5.80

7.70

4.90
0.59

0.20

0.48
0.13

0.05

0.09
HW

SLG

FW
253 450151mE
8883300mN
95 / -71 385.0 260.50
Incl.
264.00

308.00
Incl.
323.00
268.00

266.45

335.85

335.00
7.50

2.45

27.85

12.00
0.69

1.39

0.35

0.50
0.13

0.23

0.07

0.10
SLG


SLG
255 449947mE
8883300mN
97 / -72 532.85 272.50
Incl.
275.80

396.90
320.00

282.20

410.00
47.50

6.40

13.10
0.30

0.47

0.31
0.05

0.08

0.03
HW



SLG
Section 3400N
260 449812mE
8883400mN
95 / -68 348.95 NSV NSV
Section 3500N
221EXT 450130mE
8883494mN
90 / -73 424.58 NSV NSV
254 450060mE
8883491mN
95 / -69 394.85 98.00

150.00

249.00
Incl.
274.00
121.65

168.00

279.40

279.40
23.65

18.00

30.40

5.40
0.34

0.51

0.33

0.59
0.06

0.11

0.07

0.13
HW

HW

SLG
Section 3700N
257 450392mE
8883699mN
95 / -66 181.95 100.00
Incl.
108.70
110.80

110.80
10.80

2.10
0.22

0.46
0.07

0.18
HW
258 450033mE
8883697mN
95 / -70 340.95 52.00

108.70

140.00

174.00
Incl.
187.00
68.00

133.20

162.00

194.40

194.40
16.00

24.50

22.00

20.40

7.40
0.31

0.43

0.31

1.11

2.52
0.05

0.08

0.04

0.25

0.54
HW

HW

HW

SLG
Section 3775N
261 450276mE
8883775mN
93 / -70 133.55 33.00 36.75 3.75 0.33 0.11 HW
Section 3900/3950N
256 449945mE
8883898mN
95 / -61 234.25 No Assays
262 450056mE
8883950mN
93 / -65 125.35 65.00 72.00 7.00 0.32 0.04 HW
Exploration Target East of H Zone, Ntaka Hill
252 450584mE
8883100mN
95 / -77 442.48 202.50
Incl.
215.00

231.90
Incl.
239.60

398.00
Incl.
399.50
222.00

217.10

241.80

241.80

412.70

402.00
19.50

2.10

9.90

2.20

14.70

2.50
0.32

1.14

0.56

1.59

0.40

1.41
0.07

0.19

0.15

0.51

0.11

0.35
New



New



New
263 451076mE
8883225mN
93 / -60 151.85 NSV NSV
264 450955mE
8883225mN
93 / -62 164.25 33.00

108.00
41.00

128.00
8.00

20.00
0.55

0.52
0.13

0.11
New

New
Notes:
* Abandoned holes; target tested by alternate hole NAD11-259
** Mineralized Zone Partially Oxidized
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.
NSA - No Significant Assays
HW = Hanging Wall
FW = Foot Wall
SLG = Sleeping Giant Zone

On behalf of Continental Nickel Limited

Dave Massola, President and CEO

CAUTIONARY STATEMENT: 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, potential or estimated metal recoveries, resources and reserves, exploration results, future plans and objectives of Continental Nickel Limited, is forward‐looking information that involves various risks and uncertainties. There can be no assurance that such information will prove to be accurate and actual results and future events could differ materially from those anticipated in such information. 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.

Information in this announcement relating to exploration results is based on data collected under the supervision of or compiled by Patricia Tirschmann, P. Geo., who holds the position of Vice President, Exploration and is a full time employee of Continental Nickel Limited. Ms. Tirschmann is a registered member of the Association of Professional Geoscientists of Ontario and has sufficient relevant experience to qualify as a Competent Person under the 2004 Edition of the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves. Ms. Tirschmann consents to the inclusion of the data in the form and context in which it appears.

To view the Map associated with this press release, please visit the following link: http://media3.marketwire.com/docs/NACHINGWEA_PROPERTY.pdf.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

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