Continental Nickel Reports Additional Sulphide Intersections at Nachingwea, Including 1.54% Nickel and 0.33% Copper Over 3.8 Met

  Continental Nickel Limited (TSX VENTURE: CNI) ("Continental" or the "Company") is pleased to report the final assay results from the remaining eight drill holes of the twenty-two hole 2009 drilling program at the Nachingwea Project in Tanzania. The Nachingwea Project is a 70:30 Joint Venture between Continental Nickel and IMX Resources Limited ("IMX") of Australia. Highlights include multiple intervals of sulphide mineralization intersected in three drill holes drilled along a 300 metre strike length of Anomaly C at Ntaka Hill. Assay results include 1.54% nickel and 0.33% copper over 3.8 metres, within a wider 7.6 metre interval grading 1.06% nickel and 0.30% copper in drill hole NAD09-181. Narrow intervals of high grade sulphide mineralization were also intersected, including 0.8 meters grading 3.05% nickel and 0.38% copper in NAD09-181 and 4.84% nickel and 0.80% copper over 0.25 metres in drill hole NAD09-185. Subsequent bore hole EM (BHEM) surveys completed in two of these holes indicate that the drill holes intersected the edge of the targeted conductor and associated sulphide mineralization.

In 2009, thirty-five airborne VTEM targets were evaluated by ground geophysical EM surveying from 25 fixed loops, totalling 98.7 line kilometres of survey. Twenty eight targets and areas (including six targets covered with ground EM surveys) were also explored with geological mapping and soil and stream geochemical sampling surveys (545 soil and 89 stream sediment samples collected) for which assay results have yet to be received.

A drill program completed during September and October 2009 tested eleven EM anomalies with twenty-two drill holes totalling 3,922.9 metres. Results from fourteen drill holes, totalling 2,311.9 metres, were reported previously (see press release dated November 24, 2009) and the remaining eight drill holes totalling 1,611.0 metres are reported herein (Table I). Drill hole and target locations are shown on the attached figures.

Ntaka Hill

As reported previously, drill testing of a 500 metre long, high conductance EM anomaly (referred to as Anomaly C) intersected multiple zones of nickel-rich, sulphide mineralization highlighted by drill hole NAD09-180 which intersected a 9.0 meter interval of disseminated, net-textured to massive, sulphide mineralization grading 1.64% nickel and 0.29% copper. Included within this interval was a higher grade massive sulphide section grading 4.31% nickel and 0.60% copper over 2.4 metres (see press release November 24, 2009).

Additional drilling along the strike of Anomaly C (drill holes 181, 182 and 185, reported herein) intersected various multiple zones of disseminated, net textured, or semi-massive sulphides along a 300 metre strike length of the anomaly. Drill hole 181, drilled 200 metres south of drill hole NAD09-180 and near the mid-point of the anomaly, intersected three zones of sulphide mineralization including 7.6 metres grading 1.06% nickel and 0.30% copper, which includes a 3.80 metre interval grading 1.54 % nickel and 0.33% copper; 0.80 metres grading 3.05% nickel and 0.38% copper and a lower 6.15 metre interval grading 0.57% nickel and 0.12% copper. The drill hole is thought to have intersected the edge of the sulphide body previously intersected by discovery drill hole NAD09-180. A subsequent bore hole EM survey detected a strong off hole EM anomaly centered to the south and west of the drill hole.

Drill hole NAD09-182, drilled 50 metres south of drill hole NAD09-180 and 150 metres north of hole NAD09-181, intersected multiple zones of sulphide mineralization similar to that intersected in drill hole NAD09-181. Assay results include 0.63% nickel and 0.16% copper over 9.1 metres, including 1.91 % nickel and 0.55% copper over 1.05 metres. A borehole EM survey of the drill hole also indicates that the hole intersected the edge of the sulphide body which is centered to the east and north of the drill hole.

Drill hole NAD09-185 was drilled 100 metres south of drill hole NAD09-181 and is the southernmost hole to test Anomaly C. This drill hole also intersected numerous zones of nickel-bearing, disseminated, net-textured to narrow semi-massive sulphide mineralization similar to holes NAD09-180 and 181, including a narrow zone of semi-massive sulphide grading 4.84% nickel and 0.80% copper over 0.25 metres. Although this drill hole has yet to be surveyed with bore hole EM, the style of mineralization is again suggestive of an edge type intersection.

Two drill holes were also completed in the area of Anomaly B. Drill hole NAD09-184 was drilled 50 metres up dip of drill hole NAD09-177 which intersected a sulphide interval grading 1.64% nickel and 0.29% copper over 3.0 metres (previously reported). Drill hole NAD09-184 did not intersect any sulphide mineralization up dip of drill hole NAD09-177. Drill hole NAD09-183 tested a parallel conductor to the west of the sulphide zone intersected in drill hole NAD09-177 and intersected a narrow sulphide zone grading 1.19% nickel and 0.50% copper over 2.0 metres. A bore hole EM survey of this drill hole indicates that the hole intersected the edge of a conductor centered south of the drill hole.

Lionja

As previously reported, drill hole NRD09-019 was drilled to a depth of 392.3 metres to test a strong off-hole conductor at depth, which was detected in the BHEM survey of drill hole NAD016. The hole intersected numerous bands of graphitic gneiss with minor amounts of pyrrhotite at the target depth for which assays were pending at the time of the last press release. Assay results have since been received and no significant concentrations of nickel or copper were detected at the target depth. The drill hole did, however, intersect some narrow zones of sulphide mineralization at shallow depths including 1.05% nickel and 0.15% copper over 0.25 metres. This shallow mineralization is thought to be related to a south dipping zone of sulphide mineralization intersected in a number of previous drill holes as shown on the attached figure for the Lionja area. This sulphide zone may be improving down dip at depth as reflected by the sulphide intersection from drill hole LID08-005EXT which graded 2.03% nickel and 0.41% copper over 2.25 metres (reported in press release dated November 24, 2009).

Regional Targets

Assay results from two final drill holes completed to test regional targets have been received. At the Ntaka 10 target area, a second drill hole, NAD09-020 was completed to test an off-hole BHEM anomaly from a first hole (NAD09-015 previously reported) which intersected a sulphide bearing ultramafic intrusion with only low nickel and copper concentrations. Drill hole NAD09-020 also intersected a 23.0 metre interval of ultramafic rock with intermixed graphite and 1-10% pyrrhotite at the target depth. Assay results confirmed only low concentrations of nickel and copper associated with the ultramafic.

At the Mnero 1 target area, drill hole NRD09-016 was drilled to a depth of 257.3 metres to test a deep conductive anomaly. The drill hole intersected a 33 metre interval of semi-massive graphite at the target depth. No significant assay results were received.

Craig MacDougall, President & CEO of Continental Nickel Limited, reported "we are very encouraged that wide step out drilling to evaluate the Ntaka C anomaly along strike has continued to intersect numerous zones of nickel bearing sulphide mineralization in the central portion of the Ntaka intrusion. This includes high grade massive sulphide mineralization as intersected in the discovery drill hole NAD09-180. The latest drilling south of the discovery hole appears to have intersected the edge of a potential sulphide body and more drilling is planned in 2010 to fully evaluate the size and grade of this zone. With the receipt of these final drill results and soon the regional geochemical sampling results, the exploration team will now begin work on new target selection for exploration during the 2010 regional exploration program, as well as continuing exploration on identified targets to expand the defined Mineral Resources at Ntaka Hill."

Qualified Persons

The quality control, technical information and all aspects of the exploration program were supervised by Patricia Tirschmann, P. Geo., Vice President, Exploration for CNI. The information in this release was prepared under the direction of Craig MacDougall, P. Geo., President and Chief Executive Officer for Continental Nickel Limited. Both Ms. Tirschmann and Mr. MacDougall are qualified persons as defined by National Instrument 43-101.

Quality Control

The drilling was completed by Tandrill Limited of Tanzania. Drill core samples (NQ) are cut in half by a diamond saw on site. Half of the core is retained for reference purposes. Samples are generally 1.0 metre intervals or less at the discretion of the site geologists. Sample preparation is completed at the ALS Chemex preparation lab in Mwanza, Tanzania. Sample pulps are sent by courier to ALS Chemex analytical laboratory in Vancouver, Canada. Blank samples and commercially prepared and certified Ni sulphide analytical control standards with a range of grades are inserted in every batch of 20 samples or a minimum of one per sample batch. Analyses for Ni, Cu and Co are completed using a peroxide fusion preparation and ICP-AES finish (ME-ICP81). Analyses for Pt, Pd, and Au are by fire assay with an ICP-AES finish (PGM-ICP23).

About Continental Nickel

Continental Nickel Limited is focused on the exploration and discovery of nickel sulphide deposits in geologically prospective, but under-explored regions globally. Current projects include its 70% controlling interest in the Nachingwea project in Tanzania, where NI 43-101 Mineral Resources have been defined, and an option joint venture on the St. Stephen project in New Brunswick, Canada. Continental Nickel has 30,132,395 shares issued and outstanding (32,799,895 on a fully-diluted basis) and trades on the TSX Venture Exchange under the symbol CNI. The Company remains well funded with over C$9.3 million in the treasury.

On behalf of Continental Nickel Limited

Craig MacDougall, President & Chief Executive Officer

CAUTIONARY STATEMENT: 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 and reserves, exploration results, future plans and objectives of Continental Nickel Limited, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. 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., 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.

Table I: Summary of Recent Assay Results, Nachingwea Project, Tanzania.

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Drillhole   Location   Az / Dip Length   From     To  Inter- % Ni % Cu  %Co
              (UTM -                (m)    (m)    (m)   val
               WGS84)                                    (m)
----------------------------------------------------------------------------
 (NAD09)                     Ntaka Hill (Anomalies B & C)
----------------------------------------------------------------------------
   181       450762E  270 / -85  188.0  111.4  119.0   7.60  1.06 0.30 0.05
            8883798N                    Incl:
                                        115.2  119.0    3.8  1.54 0.33 0.07

                                        126.5  127.3    0.8  3.05 0.38 0.14

                                        137.0 143.15   6.15  0.57 0.12 0.03
                                        Incl:
                                        139.9  141.0    1.1  1.42 0.28 0.07
----------------------------------------------------------------------------
   182      450760E    90 / -75  152.3   39.0  44.75   5.75  0.52 0.23 0.03
           8883950N                     Incl:
                                         40.7  41.15   0.45  1.39 0.56 0.07
                                         43.5   43.9   0.40  1.04 0.31 0.05

                                         59.9   69.0   9.10  0.63 0.16 0.03
                                        Incl:
                                        65.05   69.0   3.95  0.97 0.27 0.04
                                        67.95   69.0   1.05  1.91 0.55 0.08

                                       118.35 125.25   6.90  0.55 0.21 0.03
----------------------------------------------------------------------------
   183      450424E   270 / -65  116.3  72.85  74.85   2.00  1.19 0.50 0.03
           8884100N                     Incl:
                                         74.3  74.85   0.55  2.20 1.31 0.05
----------------------------------------------------------------------------
   184      450513E   270 / -73  134.5                        NSA  NSA  NSA
           8884200N
----------------------------------------------------------------------------
   185      450710E   270 / -85  200.3   43.0  53.75  10.75  0.55 0.10 0.02
           8883701N                     Incl:
                                         50.8  51.05   0.25  4.84 0.80 0.14

                                         70.4   74.0    3.6  0.54 0.19 0.02

                                        100.0  101.0    1.0  0.51 0.16 0.03
----------------------------------------------------------------------------
                          Lionja Target Area
----------------------------------------------------------------------------
NRD09-019   448900E   010 / -70  392.3  37.75   38.0   0.25  0.53 0.18 0.04
           8876040N
                                        39.35   39.6   0.25  1.05 0.15 0.07
----------------------------------------------------------------------------
                         Mnero 1 Target Area
----------------------------------------------------------------------------
NRD09-016   459369E   270 / -70  257.3                        NSA  NSA  NSA
           8857807N
----------------------------------------------------------------------------
                         Ntaka 10 Target Area
----------------------------------------------------------------------------
NRD09-020   454719E    90 / -75  170.3                        NSA  NSA  NSA
           8875196N
----------------------------------------------------------------------------

Note: Intervals represent core lengths, not necessarily true widths.

Pt, Pd and Au assay results are not reported because in general, they are less than 1.0 g/t on a combined basis.

NSA - No Significant Assays;

Please note: Figures 1, 2, and 3 are available at the following links:

http://media3.marketwire.com/docs/cni1216figure1.pdf

http://media3.marketwire.com/docs/cni1216figure2.pdf

http://media3.marketwire.com/docs/cni1216figure3.pdf

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.

Contacts: Continental Nickel Limited Craig MacDougall, P. Geo. President and CEO [phone] [phone] (FAX) [e-mail] www.continentalnickel.com