Continental Nickel Regional Airborne Survey Identifies New Exploration Targets

Continental Nickel Limited (TSX VENTURE:CNI) ("CNI" or the "Company") is pleased
to report the identification of twenty-five new high priority VTEM anomalies
from the recently completed 2,409 kilometer airborne magnetic and
electromagnetic (EM) survey within the regional land holdings comprising the
Nachingwea Project located in southeast Tanzania. The project is part of the
75:25 joint venture between CNI and IMX Resources Limited of Australia. 


Highlights of the 2012 Airborne Survey



--  Large, high amplitude late time EM anomaly coincident with the Hog gold
    prospect 
--  Twenty-five high priority targets selected for ground follow-up 
--  1,500-2,000 metres of RC drilling planned 



Patricia Tirschmann, VP Exploration, commented: "We are pleased to have
completed another successful regional VTEM survey and are very encouraged by the
number of high quality targets generated. The identification of an EM anomaly
coincident with the Hog gold prospect further enhances the exploration potential
of this target and we look forward to drill testing it and other high priority
targets beginning in September."


The airborne geophysical survey was carried out by Geotech Limited of South
Africa employing the Versatile Time-Domain Electromagnetic (VTEM) geophysical
system. The survey ran from July 29th to August 11th and a total of 2,409
kilometers were flown in five flight blocks. The location of the survey is shown
in Figure 1 which may be viewed using the link provided with this release. 


The flight blocks comprising the 2012 airborne VTEM survey were selected by
prioritizing areas based on results of the 2010 airborne magnetic and
radiometric survey in combination with results of geochemical sampling and
geological mapping. Preliminary data from the new VTEM survey is currently being
evaluated, and targets are being selected for ground follow-up in order to help
prioritize anomalies for drill testing later in the year. 


Analysis of the preliminary VTEM data indicates that EM anomalies have been
detected on each of the five flight blocks and approximately twenty-five of
these represent high priority anomalies with late channel responses (Figure 1).
Of potential significance is a high amplitude late time EM anomaly detected on
three 200 metre spaced flight lines which is coincident with the Hog gold
prospect where surface gossan grab samples returned values of up to 4.96 g/t
gold and 0.64% copper (May 25, 2012 Press Release). Several other VTEM anomalies
are also confirmed to have coincident copper and/or nickel in soil anomalies.


The Company plans to carry out 1,500-2,000 metres of reverse circulation
drilling to test selected high priority regional VTEM and geochemical anomalies
including the Hog gold prospect. This drilling is currently expected to begin in
mid-September. 


Qualified Persons 

The quality control, technical information and all aspects of the exploration
program are supervised by Patricia Tirschmann, P. Geo., Vice President,
Exploration for CNI. Ms. Tirschmann is a qualified person as defined by National
Instrument 43-101. 


About Continental Nickel Limited

CNI is focused on the exploration, discovery and development of nickel sulphide
deposits in geologically prospective, but under-explored regions globally. The
Company's key asset is its 75% interest in the Nachingwea project in Tanzania,
where measured and indicated mineral resources have been estimated at 12.8 Mt
grading 1.21% nickel and inferred mineral resources have been estimated at 45 Mt
grading 0.30% nickel (CNI press release March 2, 2012).The project is a 75:25
exploration joint venture between the Company and IMX Resources Limited ("IMX").
The Company also has an option to joint venture on the St. Stephen project in
New Brunswick, Canada where the 2010-2012 diamond drill programs discovered new
Ni-Cu sulphide zones. In May 2012 an Arrangement Agreement was entered into
between CNI and IMX under which the shares of CNI not held by IMX would be
acquired by IMX for shares and warrants in IMX. This transaction is currently
scheduled to be completed in September 2012 after CNI holds a special meeting of
shareholders to approve the transaction and certain other conditions, including
receipt of required regulatory approvals, to completion have been met.


As at the date of this release, the Company has 42,793,508 common shares issued
and outstanding (46,866,008 on a fully-diluted basis) and trades on the TSX
Venture Exchange under the symbol CNI. The Company had over $6.6 million in the
treasury as at March 31, 2012.


On behalf of Continental Nickel Limited 

Dave Massola, President and CEO  

CAUTIONARY STATEMENT: The TSX Venture Exchange does not accept responsibility
for the adequacy or accuracy of this release. No stock exchange, securities
commission or other regulatory authority has approved or disapproved the
information contained herein. This News Release includes certain
"forward-looking statements". All statements other than statements of historical
fact included in this release including, without limitation, statements
regarding potential mineralization, potential or estimated metal recoveries,
resources and reserves, exploration results or targets, future plans and
objectives of Continental Nickel Limited, is forward-looking information that
involves various risks and uncertainties. There can be no assurance that such
information will prove to be accurate and actual results and future events could
differ materially from those anticipated in such information. Important factors
that could cause actual results to differ materially from Continental Nickel
Limited's expectations are the risks detailed herein and from time to time in
the filings made by Continental Nickel Limited with securities regulators. 


Information in this announcement relating to exploration results is based on
data collected under the supervision of or compiled by Patricia Tirschmann, P.
Geo., who holds the position of Vice President, Exploration and is a full time
employee of Continental Nickel Limited. Ms. Tirschmann is a registered member of
the Association of Professional Geoscientists of Ontario and has sufficient
relevant experience to qualify as a Competent Person under the 2004 Edition of
the Australasian Code for the Reporting of Exploration Results, Mineral
Resources and Ore Reserves. Ms. Tirschmann consents to the inclusion of the data
in the form and context in which it appears. 


To view the map (Figure 1) associated with this press release, please visit the
following link: http://media3.marketwire.com/docs/VTEMjpeg.pdf.