First Nickel Inc.

First Nickel Inc.

March 20, 2007 12:48 ET

First Nickel Inc.: Potentially Significant Mineralized System Discovered With New Embayment Feature on Morgan-Lumsden Property

TORONTO, ONTARIO--(CCNMatthews - March 20, 2007) - First Nickel Inc. (TSX:FNI) reports continued success on the exploration program conducted under the direction of Xstrata Nickel on the Morgan-Lumsden Property. The Morgan-Lumsden Property is a greenfield exploration project located on the North Range of the Sudbury Basin approximately 12 kilometres to the east of Xstrata Nickel's Strathcona Mill Complex. First Nickel has an option from Xstrata to earn a 50% interest in the Morgan-Lumsden Property on the terms previously announced in First Nickel's March 22, 2005 news release.

Hole M-059 was drilled to a depth of 1,400 metres, and was collared approximately 80 metres south-southeast of M-058A. The hole was designed to test two off-hole geophysical conductors identified by a borehole UTEM 3 geophysical survey in M-058A late in 2006. M-059 intersected a broad zone of disseminated, blebby and veined sulphide mineralization that assayed 0.71% Ni over 38.80 metres, including two separate zones of 5.60 metres of 1.03% Ni and 2.85 metres of 1.45% Ni. All assay results to date, on the Morgan-Lumsden Property, have been summarized in the following table. All assay intervals reported are core length and do not represent true widths (defined as being measured at right angles to the direction of extension of the sulphide body).

The mineralization intersected in M-059 has been interpreted by Xstrata as representing the up-dip portion of a strong conductive trend as indicated by the recently completed borehole UTEM 3 geophysical survey. M-059 appears to have intersected the upper edge of a highly conductive trend has been modeled to extend to the west and south of the hole.

M-059 intersected a thickening sequence of sublayer norite and mineralized late granite breccia that continues to support the interpretation of a new embayment feature developing along the basal contact of the Sudbury Igneous Complex into the footwall lithologies. When combined with the broad intercept of nickel-copper sulphide mineralization and the strong off-hole anomalies, the exploration results all indicate the potential of a new, significant, contact style mineralized system developing on the Morgan-Lumsden Property.

"The Morgan-Lumsden Property was one of several offered as a package along the North Range of the Sudbury Igneous Complex and has become one of First Nickel's most exciting exploration projects" states Paul Davis, Vice President, Exploration. "Many recent discoveries in Sudbury were identified by deep searching geophysical survey methods, but, are related with an existing 'embayment feature', that has been traced down plunge through historic workings from much shallower depths. The Morgan-Lumsden 'embayment feature' has no such known surface expression and represents a totally new mineralized embayment structure within the North Range of the Sudbury Basin".

The exploration results are extremely encouraging and have prompted First Nickel to accelerate the exploration program by agreeing to increase the budget from $0.5 million, the minimum required to maintain the option in 2007, to a total of $1.2 million for the year. This budget may increase depending on the success of the current exploration program.

From To Length Ni Cu Co
Hole ID (m) (m) (m) (%) (%) (%)
M-055(i) 789.45 789.80 0.35 1.72 0.12 0.05
M-055(i) 813.30 813.55 0.25 2.14 0.10 0.08
M-058 932.80 933.10 0.30 1.15 0.08 0.10
M-058 935.00 935.45 0.45 0.99 0.03 0.04
M-058A 949.25 949.60 0.35 3.68 0.07 0.12
M-058A 988.30 992.00 3.70 1.04 0.06 0.10
M-058A 1064.15 1065.20 1.05 1.52 0.46 0.04
M-059 1110.00 1148.80 38.80 0.71 0.17 0.04
incl. 1120.10 1125.70 5.60 1.03 0.22 0.05
incl. 1138.55 1141.40 2.85 1.45 0.17 0.08
(i) - Previously release results.

Drilling is currently underway approximately 80 metres to the south-southwest of M-059. The hole is expected to be completed to a final depth of approximately1,500 metres in April. Borehole geophysics will continue to play a critical role in the Morgan-Lumsden exploration program, helping to vector in on the most prospective target areas. The exploration program will include the application of Radio Imaging Method (RIM) borehole geophysical surveys to help define the mineralized system. The RIM surveying technique has been highly successful delineating mineralized systems in the Sudbury Basin on several projects including Xstrata's Nickel Rim Project.

The exploration program is being carried out under the direction of Xstrata Nickel's Senior Geologist, Alger St. Jean P.Geo,, a "qualified person" as defined in National Instrument 43-101. The information in this release was prepared under the direction of Paul Davis, P.Geo., Vice President of Exploration for First Nickel Inc., a "qualified person" as defined by National Instrument 43-101. Xstrata Nickel follows a rigorous QA/QC protocol for the Morgan-Lumsden Project which includes the regular insertion of standards and blanks in the sample batches. Drill core of interest (NQ size) is sawn in half, with one half retained for future reference and one half sent to a commercial laboratory, SGS Laboratories in Garson for preparation and specific gravity measurements and shipped internally by SGS to Toronto for assay.

First Nickel is a Canadian mining and exploration company. Its current activities are primarily focused on the Sudbury Basin in northern Ontario, the location of the company's producing property (the Lockerby Mine) and four of its exploration properties. First Nickel also has two exploration properties in the Timmins region of northern Ontario. First Nickel's shares are traded on the TSX under the symbol FNI.

This news release may contain forward-looking statements, which are subject to certain risks, uncertainties and assumptions. A number of factors could cause actual results to differ materially from the results discussed in such statements, and there is no assurance that actual results will be consistent with them. Such forward-looking statements are made as at the date of this news release, and the company assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances.

Contact Information

  • First Nickel Inc.
    William Anderson
    President & CEO
    (416) 362-7050 or Toll Free: 1-888-362-7050
    (416) 362-9050 (FAX)