Hi Farooq,
I should look at analogue methods of extracting the signal you want first. A processor is not the first line of attack.

Your sensitivity is not that high at all - there are much much more sensitive methods than yours.

One method is magenetic spin resonance, and there are some excellent webpages devoted to building your own with coils of wire wrapped around bottles of water !!

There are some famtastic designs
here

My father spent his earliest design career designing metal detectors. He made a detector in the early 1960's that could detect a 0.5mm steel sphere in a 1m x 1m x 1m bale of cotton.



Steve