Nachingwea results lift Continental

Vancouver — Assay results from the company’s first seven holes into the Nachingwea nickel sulphide project, in Tanzania, moved 5-month-old Continental Nickel (CNI-V) up 164% in recent trading.

The company, spun out of Australia’s Goldstream Mining (GSMGF-O, GDM-A) in August to hold Nachingwea, drilled 53 holes for 10,514 metres and intersected six new zones of magmatic sulphide mineralization.

The strongest result came from hole 28, collared in new zone H. The hole returned 7.5% nickel, 1.15% copper and 0.1% cobalt over 9.5 metres starting 66.5 metres down-hole, including 4 metres of 15.31% nickel, 2.52% copper, and 0.19% cobalt. In total, seven drill holes tested zone H, targeted because a recent ground electromagnetic (EM) survey identified the area as one of 12 moderate to high-conductance targets.

Twenty metres updip of hole 28, hole 26 cut 2 metres of 3.52% nickel, 0.38% copper and 0.06% cobalt from 62 metres down-hole. Of the five remaining holes into the target, four returned short massive sulphide intersections for which assays are pending.

In 2006, a Goldstream drill hole cut 3 metres grading 11.23% nickel and 1.74% copper, defining zone NAD013. Continental punched 11 holes into the promising zone, where the ground EM geophysical survey confirmed the presence of a shallowly dipping, strongly conductive anomaly with a short strike length. Five assay results have been received.

Hole 19, collared along strike 30 metres south of Goldstream’s discovery hole, returned 1.9 metres of massive sulphides grading 17.11% nickel, 2.71% copper and 0.19% cobalt from 49 metres depth. Holes 18 and 20, collared 30 metres downdip of the discovery hole and hole 19, respectively, cut narrow massive sulphide intersections. Hole 21 and 22, drilled 50 metres south along strike of holes 19 and 20, did not intersect significant mineralization.

Other targets for which drill assays are pending include target I, southeast of NAD013, and L, northwest of H, which together form a 1.3-km strike length along the western part of the Ntaka intrusion. Drilling at I and L has intersected multiple zones of semi-massive to massive sulphide mineralization. In addition, targets G, J, and M, located in the eastern and northern portions of the intrusion, returned intersections of disseminated, net-textured, semi-massive, and massive sulphides over core lengths from 3 metres to 18 metres.

The results boosted Continental’s share price by $1.99, or 164.5%, on only 276,000 shares traded to close at $2.74, a new all-time high for the nascent company. The company’s previous best share price was $1.53.

Nachingwea is located in southeastern Tanzania, 180 km west of the port city of Mtwara and 400 km south of Dar es Salaam. It is situated within the Proterozoic-aged Mozambique belt, which Continental believes has the potential to become a significant nickel camp, like other Proterozoic-rifted continental margin settings such as Thompson and Raglan in Canada, Pechenga in Russia, and Jinchuan in China.

Continental is in the midst of a $9.5-million exploration program at Nachingwea that is planned to last until summer 2009. Down-hole pulse EM surveying is currently under way on select drill holes, as is a 5,900-km airborne magnetic-EM survey.

Continental enjoyed an oversubscribed initial public offering in early August, offering shares for $1.50 apiece and raising nearly $18.98 million. The company has 26.9 million shares outstanding. Goldstream remains Continental’s controlling shareholder, with a 53% interest in the company and a 30% interest in Nachingwea.