Cashed-up Continental Nickel drills Tanzanian property

Newly listed Continental Nickel (CNI-V) has started drilling at its 70%-owned Nachingwea nickel sulphide project, in Tanzania.

The company, spun out by Aussie-listed Goldstream Mining (GDM-A) to hold the Nachingwea property, enjoyed an oversubscribed initial public offering in early August, raising nearly $18.98 million for exploration.

Drilling at Nachingwea, located 400 km south of Dar es Salaam, will consist of between 7,500 and 10,000 metres of diamond drilling, and will follow up on results of 2006 drilling by Goldstream that included a 3-metre interval of 11.43% nickel, 1.74% copper and 0.l5% cobalt. One drill rig is on-site at the 7,300-sq.-km property, with a second expected to arrive shortly.

Continental is planning a $9.5-million exploration program over the next two years, to include diamond drilling, regional airborne magnetic and EM surveys, ground EM surveys, geological mapping and geochemical sampling.

Nachingwea is situated in the Proterozoic-age 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, which is focused on developing early stage, low-cost, nickel-copper sulphide properties in underexplored regions, offered shares in its IPO for $1.50 apiece, and has 26.9 million shares outstanding. Goldstream remains the companys controlling shareholder, with a 53% interest in Continental and a 30% interest in Nachingwea.