Cancio tables more Onca drill results

Vancouver — Canico Resource (CNI-V) tabled more results from its ongoing infill drilling campaign at the Onca ridge, part of the Onca-Puma nickel laterite project in Para State, Brazil.

So far, about 17 km of the prospective 20 km strike length of Onca ridge has been tested by widely spaced holes (400 metre centres). Results to date indicate that the mineralization at Onca is thicker, more continuous and considerably more extensive than previously estimated.

Highlights in the current series of holes include;

• Hole 3362 cut 6.15 metres averaging 2.62% nickel and 0.037% cobalt, starting 1 metre down-hole.
• Hole 3370 cut 18.35 metres averaging 2.27% nickel and 0.057% cobalt, starting 2.65 metres down-hole.
• Hole 3376 cut 12.75 metres averaging 2.42% nickel and 0.151% cobalt, starting 35.7 metres down-hole. This was followed by a number of intervals including a 4.10-metre section that averaged 2.08% nickel and 0.043% cobalt; a 3.6-metre interval that averaged 1.74% nickel and 1.065% cobalt; and a 3.0-metre section averaging 1.89% nickel and 0.109% cobalt.
• Hole 3378 cut 5.0 metres averaging 2.73% nickel and 0.063% cobalt, starting 2.90 metres down-hole.
• Hole 3379 cut a number of intervals starting 43.9 metres down-hole including; 8.10 metres averaging 1.86% nickel and 0.678% cobalt, 4.90 metres averaging 1.70% nickel and 0.979% cobalt and 8.0 metres averaging 2.64% nickel and 0.166% cobalt.
• Hole 3380 cut 5.8 metres averaging 2.44% nickel and 0.014% cobalt, starting from surface.
• Hole 3381 cut 16.5 metres averaging 2.90% nickel and 0.403% cobalt, starting 13.35 metres down-hole.
• Hole 3389 cut 6.5 metres averaging 2.22% nickel and 0.101% cobalt starting 16.30 metres down-hole.
• Hole 3391 cut 17.40 metres averaging 2.47% nickel and 0.047% cobalt, starting 15.20 metres down-hole.
• Hole 3392 cut 16.20 metres averaging 1.79% nickel and 0.409% cobalt starting 3.0 metres down-hole.
• Hole 3395 cut a number of intervals starting 3.8 metres down-hole including; 1.87% nickel and 0.039% cobalt over 11.35 metres, 2.29% nickel and 0.29% cobalt over 5.60 metres, 2.08% nickel and 0.106% cobalt over 7.4 metres.

Hole 3397 cut 6.35 metres averaging 2.75% nickel and 0.033% cobalt, starting 23 metres down-hole. This was followed by a 8.65-metre interval that averaged 2.39% nickel and 0.15% cobalt and a 2-metre section that averaged 1.61% nickel and 0.056% cobalt.

“Results of our Onca drilling continue to be excellent,” said Michael Kenyon, President & CEO of Canico. “A new resource calculation for Onca will be calculated from the results of this program. As well, our Phase 2, 35,000 meter in-fill drilling program is now underway. There are 8 rigs currently working at Onca-Puma and another 4 rigs are scheduled to arrive on site as soon as they are available.”

Engineering work is ongoing and a full feasibility study expected by the second half of 2004. Environmental base line studies and social studies are also underway and some preliminary metallurgical tests have also been completed. In addition, Canico is in discussions to start pilot plant tests later this year.

As part of the feasibility study, a scoping study will evaluate the capital and operating costs for a conventional smelter nickel project. This review will compare the costs associated with single line (1.25 million tonnes per year), or a double line (2.5 million tonnes per year), ferronickel and nickel matte operation.

In early 2002, Consulting Engineers, Watts, Griffis and McOuat, pegged inferred resources at Onca at 22.6 million tonnes grading 2.1% nickel. About 45% of the old drill holes and test pits which were used to calculate the resource stopped in nickel mineralization assaying over 1.5% nickel.