Adelaide, Feb 12, 2007 (ABN Newswire) - Proto Resources & Investments Ltd and Cazaly Resources Limited today
commenced an expanded exploration program - including gravity and "SQUID"
electromagnetic surveys - on their Mt Vetters nickel project near Kalgoorlie
in Western Australia.
The Mt Vetters project (75% Proto and 25% Cazaly) is centered approximately
39 kilometres north-north-west of Kalgoorlie, five kilometres south of the Silver Swan Mine and 30 kilometres northwest of the Bulong South nickel sulphide system recently discovered by Southern Gold Limited.

"The Mt Vetters project has potential for both classic Yilgarn styled gold mineralisation and komatiite hosted nickel sulphides," Proto Chairman, Mr Andrew Mortimer said today.

"Drilling by previous holders also reveals anomalous uranium which Proto is currently investigating," he said.

The project comprises Exploration Licence E27/277 and Prospecting Licences
P27/1563, P27/1564, P27/1565, P27/1563, P27/1564 and P27/1565.

Proto has retained Southern Geoscience Consultants to review previous data
on its Mt Vetters area as well as to design programs, coordinate surveys and
interpret data.

Southern Geoscience's expertise in the Yilgarn has led to the discovery of numerous new nickel sulphide systems, including the Gillet nickel sulphide discovery at Widgiemooltha (Consolidated Minerals Limited).

The proposed program will employ SQUID B-field electromagnetics (EM) and detailed gravity. The SQUID EM has the ability to detect both subtle and deep conductors, sometimes missed using conventional EM techniques.

The gravity survey will target areas of deeper weathering over possible
sulphides, a well documented feature of Silver Swan mineralisation.

Background

The project area is part of the Norseman-Wiluna greenstone belt in the Eastern Goldfields Province of the Archaean Yilgarn Craton. The geology is typically Archaean granite-greenstone terrain, characterised by large areas of granitoid and narrow linear belts of greenstone. The greenstones comprise thick mafic to ultramafic volcanic sequences, felsic to intermediate volcanics and sedimentary sequences.

The Mt Vetters tenements are just south of the Black Swan Komatiite Complex (BSKC), host to the Silver Swan mine (indicated resource 640,000t @ 9.5% Ni), Black Swan (probable reserve of 10.4Mt @ 0.83% Ni) and adjacent Cygnet deposit (probable reserve of 1.1Mt @ 2.1% Ni). Mineralisation at Silver Swan, Black Swan & Cygnet is hosted by a thick sequence of olivine cumulates and spinifex textured ultramafic flows, which are altered to talc-carbonate assemblages and serpentinite adjacent to the massive sulphide ore body. Mineralisation comprises massive pentlandite & pyrrhotite lenses and minor zones of pyrite and millerite. The Silver Swan deposit is a discrete, steeply plunging, eastern dipping 550 m long shoot of massive sulphides (pyrrhotite-pentlandite-pyrite), which has been intersected by drill holes between 190 m and 1000 m below surface. Silver Swan shows that nickel mineralisation elsewhere in the district may exist well below the surface, and confirms the SQUID EM approach targeting deeper levels of geology.

In detail the underlying geology of the Mt Vetters tenements is obscured by surficial sediments. Due to the lack of outcrop, aeromagnetics and regolith RAB and RC drilling have been used locally to help interpret the underlying geology within the project area. The aeromagnetic dataset highlights the presence of a large elongate zone of strongly magnetic lithologies which is interpreted to represent the ultramafics of the Black Swan Komatiite Complex. This magnetic zone is presumed to be bounded by felsic volcanics and sediments of the Gindalbie Formation, due to correlation and extrapolation of the magnetic response of these rocks from outcropping areas to the northwest and southeast. The Gindalbie Formation also hosts the Kanowna Belle gold deposit within the Kanowna Belle porphyry located 10 km SSW of the Mt Vetters project.

Regionally, east over west thrust faults have produced structural repetition via thrust stacking as evident by repetitions of at least four distinct ultramafic horizons within the regional stratigraphy. The project therefore offers good scope for the discovery of massive nickel sulphide mineralisation of the same type and style as Silver/Black Swan.

Previous work in the area has included conventional electromagnetics, but the advantages of the SQUID system are considerable. Similarly, gravity will compliment the SQUID electromagnetic survey, and along with new detailed airborne magnetics, should reveal any new nickel sulphide targets on the Mt Vetters tenements.

The information in this report relates to planned exploration, and is based on information compiled by Andrew Johnstone who is a Fellow of the Financial Services Institute of Australasia, and members of both the Australian and American Societies of Geophysicists. Mr Johnstone is a full time employee of Proto Resources & Investments Ltd. Mr Johnstone has extensive qualifications and experience in the style of mineralisation and types of activity described. Mr Johnstone consents to the inclusion in this report of the matters based on information provided to him and in the form and context in which it appears.

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