Continental Nickel Limited
TSX VENTURE : CNI

Continental Nickel Limited

August 13, 2012 08:05 ET

Continental Nickel Updates Tanzania Exploration Program; New Sulphide Mineralization Intersected at Ntaka Hill

TORONTO, ONTARIO--(Marketwire - Aug. 13, 2012) - Continental Nickel Limited (TSX VENTURE:CNI) ("CNI" or the "Company") is pleased to report that the first assays have been received from its 2012 drilling program in Tanzania that commenced in May. Highlights are as follows:

Highlights of the 2012 Drilling Program to Date

  • New sulphide mineralization assaying 1.04% nickel and 0.22% copper over 32.65 metres located near the northeastern edge of Sleeping Giant;

  • Multiple intersections of disseminated sulphides in the hanging wall to Sleeping Giant assaying greater than 0.5% nickel, including 1.00% nickel and 0.20% copper over 14.80 metres;

  • L Zone mineralization extended 50 metres to the south; and

  • Ultramafic hosted sulphides intersected in both Ntaka and Lionja exploration holes.

Patricia Tirschmann, VP Exploration, commented on the 2012 exploration program: "The 2012 drilling program is well underway and we look forward to reporting more new assays at regular intervals including results of recently completed exploration holes. We are also eagerly awaiting results from the new VTEM survey, particularly over high priority targets like the Hog gold showing. At Sleeping Giant, the intersection of both new mineralization, as well as hanging wall zones returning assay values greater than 0.5% nickel, is very encouraging. New intersections at Sleeping Giant will be incorporated into the drilling database and are currently expected to result in another mineral resource estimate update in early 2013."

The Company has been implementing a CDN$10.0 million exploration program for 2012 on the Nachingwea project. This program has focussed on 1) carrying out in-fill and step-out diamond drilling at the Sleeping Giant zone; 2) drill testing exploration targets in the Ntaka and Lionja ultramafic intrusions; and 3) generating and exploring priority targets on the regional land holdings. The program includes 20,000-25,000 metres of diamond and reverse circulation (RC) drilling, a 2,500 line km regional airborne versatile time domain electromagnetic (VTEM) survey and ground geophysical surveys.

The 2012 drilling program was initiated in mid-May and is being carried out by Capital Drilling (Tanzania) Limited with three diamond drill rigs currently in operation. A total of 12,683 metres in 56 drill holes were completed to the end of July, including in-fill and geotechnical drilling at Sleeping Giant and exploration drilling at Ntaka Hill, Lionja and regional targets. Reported assay results now include twelve drill holes from in-fill drilling at the Sleeping Giant Zone as provided in Table I below. A location figure may be viewed using the link provided with this release. Further assay results will be reported as they are received, compiled and validated.

Sleeping Giant Drilling

In-fill drilling is being carried out on 50 metre centres over the northern, shallower half of the deposit area with the goal of upgrading the current estimated mineral resource categories and further defining the near surface zones of hanging wall mineralization situated within the northern end of the conceptual pit for the Sleeping Giant zone. The drilling began on the northernmost sections and is progressing southwards. Step-out drill holes are also planned to test for the potential down-plunge extension of the high grade core of the zone.

Twelve holes totaling 2,371 metres and extending from sections 3700N to 3900N are reported in Table 1. Significant results to date include:

  • Numerous hanging wall intersections of disseminated sulphides, including 1.00% nickel and 0.20% copper over 14.80 metres from 83.2 to 98.0 metres in drill hole NAD12-266 (section 3900N) and additional intersections grading 0.50% nickel or better in drill holes NAD12-268, 269, 272, 274 and 275.

  • New mineralization intersected on Section 3750N which is located northeast of the Sleeping Giant zone just below the bottom of the conceptual open pit in an area where no previous wireframes had been interpreted. Drill hole NAD12-270 intersected a wide zone of disseminated to heavily disseminated sulphides grading 1.04% nickel and 0.22% copper over 32.65 metres from 172.6 to 205.25 metres, including 1.45% nickel and 0.25% copper over 14.05 metres. This mineralization is interpreted to represent either a new sulphide zone or a down dropped portion of the high grade core of the Sleeping Giant zone.

  • An intersection in drill hole NAD12-267 on Section 3850N comprised of disseminated sulphides and narrow remobilized massive sulphide veins which graded 0.70% nickel and 0.20% copper over 25.30 metres from 110.0 to 135.3 metres, including a higher grade portion grading 2.03% nickel and 0.35% copper over 3.8 metres. This mineralization is interpreted to correlate with L zone to the north and, as such, extends L zone an additional 50m to the south.

In-fill drilling at Sleeping Giant is on-going with two diamond drill rigs and assays will be reported as they are received.

Drilling of Ntaka Hill and Lionja Intrusions

Exploration drilling at the Ntaka ultramafic intrusion outside of the Sleeping Giant zone has focused on a) testing previously untested electromagnetic anomalies; b) testing coincident nickel and copper soil anomalies; and c) following up on nickel mineralization intersected south and east of H zone in 2011. To date, eleven drill holes totalling 1,802 metres have been completed to test seven exploration targets. All of these holes have intersected various concentrations of sulphides hosted within the Ntaka ultramafic intrusion.

Exploration drilling at the Lionja ultramafic intrusion located eight kilometres to the south of Ntaka Hill is following up previously intersected nickel mineralization as well as testing coincident nickel and copper in soil anomalies. Six drill holes totalling 1,270 metres have been completed to test targets at Lionja. Four of these were 50 to 200 metre step-out holes targeting an ultramafic hosted mineralized horizon intersected in previous drilling. Five of the six Lionja exploration holes completed to date have intersected various concentrations of sulphides hosted within the ultramafic intrusion. Assays are pending.

Regional Exploration

Testing of regional targets is on-going with one drill rig. One hole totaling 216 metres has been completed to test the Noli exploration target and assays are pending.

Airborne Survey

The Company also confirms that a 2,500 line kilometre airborne versatile time domain electromagnetic (VTEM) survey was initiated in late July and is being flown by Geotech Airborne Limited. The survey will cover selected portions of the regional land holdings, including the area of the newly discovered Hog gold showing where surface gossan grab samples returned values of up to 4.96 g/t gold (May 25, 2012 Press Release).

The survey is scheduled for completion by mid August. Anomalies will be prioritized and explored with additional soil geochemical sampling, geological mapping, prospecting, and ground geophysical surveys in order to select targets for drill testing later this year.

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 Capital Drilling (Tanzania) Limited. 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 12.8 Mt grading 1.21% nickel and inferred mineral resources have been estimated at 45 Mt grading 0.30% nickel (CNI press release March 2, 2012).The project is a 75:25 exploration joint venture between the Company and IMX Resources Limited ("IMX"). The Company also has an option to joint venture on the St. Stephen project in New Brunswick, Canada where the 2010-2012 diamond drill programs discovered new Ni-Cu sulphide zones. In May 2012 an Arrangement Agreement was entered into between CNI and IMX under which the shares of CNI not held by IMX would be acquired by IMX for shares and warrants in IMX. This transaction is currently scheduled to be completed in September 2012 after CNI holds a special meeting of shareholders to approve the transaction and certain other conditions, including receipt of required regulatory approvals, to completion have been met.

As at the date of this release, the Company has 42,793,508 common shares issued and outstanding (46,866,008 on a fully-diluted basis) and trades on the TSX Venture Exchange under the symbol CNI. The Company had over $6.6 million in the treasury as at March 31, 2012.

On behalf of Continental Nickel Limited

Dave Massola, President and CEO

CAUTIONARY STATEMENT: 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. 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 or targets, 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.

Table I: Summary of Assay Results
Sleeping Giant Zone and Ntaka Hill, Nachingwea Project, Tanzania
Drill hole Location Az / Length From To Interval % Ni % Cu Zone
(NAD12-) East/North Dip (m) (m) (m) (m)
UTM:WGS84
Section 3900N
266 450091mE 90 / -69 131.0 83.20 98.00 14.80 1.00 0.20 HW
8883901mN Incl.
83.20 83.50 0.30 4.07 0.69
86.50 88.00 1.50 3.12 0.52
93.00 94.00 1.00 2.48 0.30
Section 3850N
265 450033mE 90 / -69 136.1 NSA NSA HW
8883851mN
267 450144mE 90 / -69 166.5 94.00 105.00 11.00 0.62 0.10 HW
8883851mN
110.00 135.30 25.30 0.70 0.20 L Zone
Incl.
131.50 135.30 3.80 2.03 0.35
147.90 148.40 0.50 1.94 0.02 SLG
268 450088mE 90 / -69 151.1 38.20 53.00 14.80 0.30 0.06 HW
8883851mN
85.10 85.60 0.50 3.24 0.70 HW
89.80 103.00 13.20 0.64 0.09 HW
Incl.
89.80 90.50 0.70 3.45 0.16
92.00 92.60 0.60 2.12 0.47
Section 3800N
269 450198mE 90 / -69 158.3 30.00 46.00 16.00 0.51 0.12 HW
8883801mN
271 450141mE 90 / -69 197.3 26.20 37.50 11.30 0.45 0.10 HW
8883801mN
102.40 113.00 10.60 0.39 0.08 HW
118.00 142.00 24.00 0.32 0.06 HW
273 450030mE 90 / -69 250.3 101.45 108.00 6.55 0.56 0.11 HW
8883801mN
Section 3750N
270 4502534mE 90 / -69 224.4 172.60 205.25 32.65 1.04 0.22 New/
8883751mN Incl. SLG
190.00 204.05 14.05 1.45 0.25
272 450197mE 90 / -69 198.6 22.00 36.00 14.00 0.33 0.08 HW
8883751mN
45.00 65.00 20.00 0.32 0.07 HW
96.00 106.00 10.00 0.73 0.16 HW
120.65 127.00 6.35 0.55 0.13 HW
136.00 145.90 9.90 0.60 0.11 HW
274 450142mE 90 / -69 245.4 107.80 136.00 28.20 0.50 0.09 HW
8883751mN
276 450087mE 90 / -69 247.4 76.00 95.00 19.00 0.41 0.08 HW
8883751mN
111.65 118.00 6.35 0.33 0.07 HW
190.75 191.15 0.40 5.93 2.37 SLG
Section 3700N
275 450131mE 90 / -69 265.0 30.00 41.45 11.45 0.33 0.09 HW
8883701mN
131.00 146.00 15.00 0.42 0.14 HW
Incl.
135.00 140.00 5.00 0.65 0.13
234.2 236.00 1.80 1.18 0.35 SLG
Notes:
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

To view the map associated with this press release, please visit the following link: http://media3.marketwire.com/docs/Sleeping_Giant_Drill_Plan.png.

Contact Information

  • Continental Nickel Limited
    Dave Massola
    President and CEO
    (416) 603-8416 (ext 228)
    (416) 603-8760 (FAX)

    Continental Nickel Limited
    Patricia Tirschmann
    Vice President, Exploration
    (416) 603-8416 (ext 224)
    (416) 603-8760 (FAX)
    info@continentalnickel.com
    www.continentalnickel.com