Continental Precious Minerals Inc.
TSX VENTURE : CZQ

Continental Precious Minerals Inc.

October 05, 2005 16:30 ET

Continental Precious Minerals Inc.: Additional Swedish Exploration Licences

TORONTO, ONTARIO--(CCNMatthews - Oct. 5, 2005) - Continental Precious Minerals Inc. (TSX VENTURE:CZQ) (the "Company" or "Continental") is pleased to announce that as a result of recent licences acquired from the Inspectorate of Mines in Sweden, it now holds a total of 35 exploration licences in Sweden.

HRU Licenses

On the eight exploration licences which are the subject of a National Instrument 43-101 report filed on SEDAR (the "HRU Licences"), the Company is presently carrying out preliminary scoping studies to determine the order of priority for drilling targets. Once this order of priority has been determined, the Company intends to carry out a drilling programme presently estimated to cost between US $0.4 million and US$1.3 million depending on the work done and field results.

The Company now holds three additional exploration licences for uranium exploration in the county of Norrbotten in northern Sweden. These licences cover extensions to known mineralisation on Continental's licences over the Pleutajokk (1 licence) and Kvarnan (2 licences) uranium deposits. These exploration licences are valid for three years, are renewable subject to satisfactory work programs having been carried out and confer the right to apply for a mining licence once an economic deposit has been located. They are subject to a 5% net profit interest in favour of Geoforum and minor royalties in favour of the Swedish government following recent changes in Swedish Mineral Legislation.

The Guorbavare No.2 Licence encloses the Company's 77.00 hectare Guorbavare Licence (which forms part of the HRU Licences), which contains the Pleutajokk deposit, and covers an additional area of 883.90 hectares. This new licence covers all of the known uranium vein mineralisation outside of Continental's pre-existing licence and south of the Hornavan Nature Reserve. These newly licenced occurrences were located and part-scout drilled by the Swedish Geological Survey prior to its prematurely ceasing operations in 1981.

As indicated in the NI 43-101 report relating to the HRU Licences, the Guorbavare Licence (which forms part of the HRU Licences) contains the northeasterly trending Pleutajokk "B" vein deposit which contains an estimated 470,000 tonnes of Indicated Resources, defined at 300 ppm, at an average grade of 0.117 % uranium and 1.4 Million tonnes ("Mt") of Inferred Resources at an estimated grade of 0.101 % uranium. The "B" deposit remains open in depth and a faulted extension may lie north of a major northwesterly trending fault which cuts it off. The "A" deposit also occurs on the HRU Licences and though partially drilled, has no current defined resources.

The other two new licences adjoin Continental's 81.5 hectare Kvarnan Licence (which forms part of the HRU Licences) to cover possible strike extensions of the main mineralisation. The 55.25 hectare Kvarnan No.2 Licence lies along the southwestern border of the Kvarnan Licence whilst the 66.36 hectare Kvarnan No.3 Licence lies along the northeastern boundary of the Kvarnan Licence. The Kvarnan No.3 licence also covers potential strike extensions of the mineralisation which gave rise to the "North" mineralised boulder field, which remains to be explored.

As indicated in the NI 43-101 report relating to the HRU Licences, the epigenetic, stratiform Kvarnan mineralisation was estimated to contain 1.6 Mt of Indicated Resources, defined at a cut-off of 300 ppm U and averaging 0,076 % uranium. Inferred Resources are estimated to be approximately 0.3 Mt at an average grade of 0.058 % uranium.

MMS Licenses

The Company now holds 18 exploration licences covering an area of approximately 97.54 square kilometres in northern Sweden containing black shale hosted metalliferous deposits and semi- anthracitic laminae, referred to by the Company as the "Multi-Metal Sediment Licences" or "MMS Licenses" . These exploration licences were taken out for vanadium and molybdenum, are valid for three years, are renewable subject to satisfactory work programs having been carried out and confer the right to apply for a mining licence once an economic deposit has been located. Seven of the 18 exploration licences were acquired by Continental from Geoforum Scandinavia AB earlier this year. The remaining 11 exploration licences have been issued directly to Continental by the Inspectorate of Mines in Sweden. Geoforum has been granted a 5% net profit interest in any mineral production from the lands covered by the MMS Licences. They are also subject to minor royalties in favour of the Swedish government following recent changes in Swedish Mineral Legislation.

The MMS Licence areas are contiguous to semi-contiguous and are centred approximately 23 kilometres southwest of the regional centre of Ostersund in the Swedish County of Jamtland. The MMS Licence area was explored by the Swedish Geological Survey ("SGU") in the 1970's to early 1980's. The SGU drilled 28 vertical diamond drill holes in an area of approximately 250 square kilometres and analysed the alum shale cores for molybdenum, vanadium, uranium and organic carbon ("Corg"). Some analysis were also carried out for nickel and sulphur.

The MMS Licence areas' target stratigraphy consists of Cambrian-aged black shales interlayered with subordinate quartzites, limestones and 'stinkstones' (bituminous limestone) and are overlain in parts of the project area by Ordovician limestones. The black shales are generally underlain by thrusts over Precambrian basement granites. The shales occur as both autochthonous (in-situ) and allochthonous (fault detached) blocks, the latter having greater potential for economic mineralisation. The black shales forming the detached, imbricated allochthonous blocks can be subdivided into those belonging to the Middle Cambrian and Upper Cambrian, with the highest grades of mineralisation occurring in the Upper Cambrian black shales.

The thickness of the Upper Cambrian-aged black shales hosting the syngenetic deposits has been tectonically increased from a general 30-50 metres by Caledonian-aged thrusting and folding to 180 metres near the village of Myrviken.

Previous work carried out elsewhere in Sweden on similar, unmetamorphosed black shales has suggested to Continental that MMS Licence area material potentially could be acid leached at high temperatures. The heating value of the black shales has been variously estimated at between 5 to 7 MJ /kg and its organic carbon content could, with suitable preparation, provide the bulk of the energy required for the high temperature acid-leaching of its contained metals.

The low-grade metalliferous deposits contained in the MMS Licences are currently of a strategic nature. Continental intends to investigate these deposits in a measured manner, will licence further ground in this area and elsewhere and will seek project financing at a later date.

Andrew Phillips of Telluride & Associates, a Qualified Person under National Instrument 43-101, is responsible for the technical disclosure contained in this press release.

Information regarding forward looking statements: Except for historical information contained herein, the statements in this press release are forward looking statements that are made pursuant to the safe harbor provisions in the private Securities Legislation Reform Act of 1985. Forward looking statements involve known and unknown risks and uncertainties, which may cause Continental's actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things: volatility of natural resource prices, product demand, market competition and risks inherent in mineral exploration and mining.

THIS NEWS RELEASE WAS PREPARED BY CONTINENTAL, WHICH ACCEPTS RESPONSIBILITY FOR ITS ACCURACY AND THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

Contact Information

  • Continental Precious Minerals Inc.
    ED GODIN
    President
    (416) 805-3036
    (905) 276-4862 (FAX)