Continental Nickel Makes Headway In Tanzania

Nickel prices may be in the dumps, but that isn’t dampening Continental Nickel’s (CNI-V, CNKDF-O) drive at its Nachingwea nickel sulphide project in Tanzania, which recently returned some encouraging results.

Assay highlights from 24 diamond- drill holes on five sulphide zones of the Ntaka intrusion include 7.2 metres grading 5.71% nickel and 0.92% copper, including 2.6 metres of 14.11% nickel and 1.74% copper in the L sulphide zone.

In the H sulphide zone, highlights include 2.5 metres of 15.96% nickel and 1.33% copper and in the M sulphide zone, 8.4 metres averaging 2.84% nickel and 0.64% copper, including 3.4 metres of 3.96% nickel and 0.83% copper.

Continental Nickel plans to start resource studies on all five zones at the Ntaka intrusion once it receives the remaining assay results from 2008. So far, all of the zones have shown continuity and intersected high grades at shallow depths.

The Toronto-based junior drilled 119 holes totalling 15,570 metres last year at its 70%-owned Nachingwea project.

About 180 km west of the port city of Mtwara and 400 km south of Dar es Salaam, the country’s main business centre, Nachingwea is a joint venture between Continental Nickel (70%) and Australia’s IMX Resources (GSMGF-O, IXR-A), (30%).

Under the terms of the joint venture, Continental Nickel, the project operator, is to fund C$15 million in spending on Nachwingea to bring its interest up another 5% to 75%.

If Continental completes a feasibility study, its interest will climb another 5% to 80%. Both parties must fund their share of spending once Continental has satisfied its funding requirement, or dilute.

Continental Nickel is well financed. Last year, it spent $7 million on exploration and still has about $13 million left in its treasury.

In Australia, IMX Resources recently traded at about A19¢ per share. Continental Nickel traded at 74¢ per share, and has a 52-week trading range of 23¢-$3.20.