Diamcor Doornkloof Exploration Update


KELOWNA, B.C., Sep. 21, 2006 (Canada NewsWire via COMTEX News Network) -- TSX.V Symbol (DMR)

Wayne Wolf, President and CEO of Diamcor Mining Inc. (TSX - DMR), today reports that Management has now received and reviewed the initial independent technical exploration report outlining the most recent work conducted by MPH Consulting Ltd., on the previously announced Doornkloof exploration project. The following release is a summary of the relevant information and findings of that report, along with an overview of how these efforts will now be used to plan future work related to the project.

Initial Exploration Overview

The focus of the 2006 initial exploration project at Doornkloof, and the subsequent initial independent technical exploration report generated by MPH Consulting Ltd., was as follows:

  • To perform an examination and mappings of historical workings.
  • To conduct trenching to expose the contacts of two known kimberlite blows - termed the north and south blows - and to search for kimberlite dykes.
  • To perform the further excavation of +/- 2,000 tonnes of bulk samples from each blow.
  • To process the bulk samples through the existing So Ver plant.
  • To seek verification of any diamond recoveries.
  • To collect samples for petrography, major element kimberlite indicator mineral analyses and microdiamonds.

The report presented to Management was based on information provided by So Ver Mine management, and the exploration work that was carried out by I.B. McGeorge from January 10th to 18th, 2006. The property was also visited by consulting metallurgist T. Crossland on January 13th and 14th, 2006. Verification of tonnage treated and any diamonds recovered was by O. Ball, who was on site from January 13th to 22nd, 2006. The Author of the report was Mr. Paul A. Sobie of MPH Consulting Ltd. The final report was prepared in Gaborone, Botswana, and Toronto, Canada. The project is being completed by Diamcor under a permit issued in South Africa in September of 2005 to the company's majority owned (74%) subsidiary, Ongoza Mining and Exploration (Pty) Ltd. This initial work, and the report presented, was completed as an initial independent exploration report to allow the Company to evaluate the potential of certain identified areas of the property in a cost effective manner. Management will used the information and recommendations within the report to assist them in planning the next steps of the project.

Basis for Exploration

Diamcor's So Ver property is the current location of the company's So Ver Tailings Retreatment Mine, which is 100% owned and operated by Diamcor's South African subsidiary, So Ver (Pty) Ltd. The tailings currently being treated at the facility are the result of historical mining along the Ardo kimberlite dyke system, which passes through the property. The diamondiferous kimberlite Ardo dyke system was first found and worked along its entire length starting in the early 1950's. A number of underground mines were established along what then became known as the Ardo Fissure system. The system can be traced along its NNE - SSW strike for about 4 kms, with a typical width of 40 - 50 cms. The original mine at the south end of the fissure system, is known as the Ardo Mine, and is currently owned and operated by African Gem Resources Ltd. (Afgem), and is still producing ore from underground. Kimberlite from the Ardo Mine, undiluted by country rock, has a reported historical grade of approximately 50 cpht (carats per hundred tonne), and 20 cpht when diluted by the surrounding friable shale within normal mining stopes.

As is common in fissure systems, the payable dyke, in this case Ardo, is assumed to be flanked by ancillary dykes with lower diamond contents which have not been mined. One of these postulated ancillary dykes for Ardo was named the Doornkloof Dyke, and the discovery of the exact location and size of that dyke also formed part of the basis of the program undertaken by Diamcor. Given the current existing operations and landholdings associated with the Company's So Ver Mine, Management believes the discovery of even a moderately diamond rich deposit could present an attractive opportunity for the Company.

Previous work by MPH in the 2000 report on So Ver for Diamcor had identified two small kimberlite blows along a postulated dyke, termed the "Doornkloof West" dyke, which were thought to be about 500m west of the Ardo dyke, and parallel to it. Kimberlite could be seen in historical workings at the sites of the blows, but these had never been fully exposed, and there were no accessible reports of them in literature. The work completed allowed the company to further evaluate the areas in a cost effective way, and to secure information which could provide direction to Management for use in any future efforts aimed at locating the postulated Doornkloof dyke in question.

Examination and Mapping of Historical Workings

The historical research completed by MPH for this most recent independent technical report confirmed that the South Blow was actually investigated by De Beers in the 1980's and found to be lamproite, or lamproitic kimberlite. It was also confirmed by MPH that the Southern Blow had been previously exposed in two small pits 3 - 4 m deep, and through the digging of two vertical shafts. The shafts were located and confirmed to be 27 m and 45 m deep, and the deeper shaft in fact had been covered over by steel capping. Chips of dark, fresh, kimberlite / lamproite were found lying around the deeper shaft. Historical exploration data on the area and the two blows was scarce and almost entirely anecdotal. Through further research and discussions with the original So Ver mine surveyor, it was discovered that the deeper shaft was hand dug by a prospector in the 1980's. The prospector was also contacted by MPH, and he reported that he had constructed three drives off the deeper shaft at its base. MPH could not confirm any claims made by the prospector with regards to tonnage removed, or results on grade through historical records, nor through confirmation by any independent qualified person who participated in the recovery at that time. Given this, any reportable results acquired from depth would need to be established through additional efforts and future bulk sampling at those levels. Management believes the recovery of usable and verifiable samples from those depths, using the existing shaft discovered, could allow for a cost effective way to acquire more information on the potential of the South Blow at deeper levels.

In its efforts to establish historical research on any previous work on the North Blow, MPH found no significant information available other than from the same prospector involved with the South Blow. MPH reported he was aware of the site, but believed it to be a "large", but barren pipe. A review of the site by MPH reported that two vertical percussion boreholes were drilled in the North blow, and a third was located adjacent to the blow on its eastern side.

MPH was unable to locate any historical workings on the inferred Doornkloof West dyke that was postulated to join the north and south blows.

Additional research on the landholdings of the So Ver property by MPH also confirmed that there is an area of the landholdings which at some time in the past was proclaimed "public diggings", and this can be confirmed by the various claim beacons which were left behind on the property. The ground in this area has been turned over many times, and it appears that these small claim holders may have been working superficial "rooikoppie" type gravels containing colluvial / elluvial diamonds. It was reported that at least one significantly deep vertical shaft was present suggesting some kimberlite might have been found. Basic trenching during the recent efforts next to the shaft failed to identify any kimberlite. MPH reported that the So Ver mine surveyor contacted was of the opinion that the old claims were along a kimberlite dyke, but again no usable evidence of this was found, and further investigation into other possible dykes using various geological methods was not planned as part of this initial exploration program.

Exploration Work Completed by MPH and Diamcor

During the initial exploration work of 2006, a program of trenching to try to locate the inferred Doornkloof West dyke was completed. The North and South Blows previously identified in the 2000 MPH report were exposed in a series of trenches, and the surface areas of the blows determined. Following that work, bulk samples of approximately 2,000 tonnes of material from each blow were mined and treated through the So Ver plant facility. These excavations were done with 20 - 30 tonne capacity excavators and were directed and supervised by Ian McGeorge, of MPH. The excavations were also carefully examined, and surveyed using real time GPS by mine surveyor F. van der Merwe.

The identified North Blow lies mainly beneath a water reservoir constructed by Diamcor. Prior to the present work, it was exposed in the walls of the reservoir, but had not been recognised. The northern portion of the blow is beneath a small canal that carries irrigation water, and despite efforts by Diamcor before this latest work, the area could not be fully dried out in time for the trenching and sampling work completed. All work on the North Blow was largely confined to the southern part of this North Blow area, and while the one trench aimed at defining the contact of the northern point did prove to almost expose it in the northeast corner, the remaining northern contact could not be well constrained. The blow is elongated in a SSW - NNE direction and is about 90m across on the axis and about 40m in the WNW - ESE direction.

In the east and southeast, the contact of the North Blow with the shale country rock was found to be vertical, and the southern trench showed a wavy, irregular contact. The west and southwest contact however, found the undulating kimberlite contact dips inward at an unusually shallow angle of some 30 degrees.

The kimberlite of the north blow had a low content of olivine macrocrysts. It was deeply weathered, soft and friable, but contained boulders of very hard, fresher rock. When damp it had a deep green colour. The MPH report pointed out shale xenoliths are very conspicuous.

The explored South Blow is located 800m SSW of the North Blow, and as has been indicated, it was previously identified as lamproite by DeBeers. There were two vertical shafts located, which were measured as being 27 m and 45 m deep, with the latter reaching fresh, dark blue-black lamproite / kimberlite.

Trenches on the South Blow were started in one of the exposed pits, and dug outwards to the cardinal points of the compass until the kimberlite contacts were reached. The resulting contacts were cleanly exposed to the east, west and south, and the northern contact was more or less parallel to its strike but well constrained. The contacts were found to dip inwards at steep angles of about 80 degrees, although in the west the contact is quite undulating. The South Blow was found to be somewhat elongated NNE - SSW and extended for about 100m. It appears to have a bulge to the east, and its short dimension reaches about 50m across.

This work determined the size of both the north and south blows at approximately 0.3ha each.

Doornkloof West Dyke Identification

The identification and confirmation of a dyke striking about 34 degrees between the two blows seemed to be supported by the directions of the elongations of the blows. If present, it was assumed it would run parallel to the Ardo dyke system. Some limited trenching was completed north and south of the South Blow in an effort to find evidence of this, however this limited work failed to provide any concrete results. It is reported by MPH to be possible that, if the dyke is present, it may pinch out or go "blind" (not reach the land surface) for some distance and confirmation of that possibility will have to be further researched through the use of additional geophysical techniques.

Other Dyke Identification on Property

A deep vertical shaft 400m southeast of the South Blow was also located. This shaft is circular, approximately 2.0 meters in diameter with associated spoil heap containing shale and large pieces of brown kimberlite. It appeared possible, though by no means certain, that the kimberlite came from the shaft. Consequently, a NW - SE trench was dug about 10m north of the shaft, looking for a dyke striking parallel with the Ardo system. Again, with this limited work, no kimberlite was found.

Bulk Sample Processing

All bulk samples were processed using the existing facilities, machinery, and manpower from So Ver under the independent direction of MPH. At the time of the exploration work the plant was closed for annual maintenance. The plant was cleaned and previously processed tailings run through the plant to sanitize it and fill dead areas in the process. The program performed called for the first bulk sample from one of the identified blows to be run through the plant over a period of days as recovered, after which time sanitized tailings would again be run through the system to clean it before the second bulk sample from the second blow area would be run.

As this was an initial assessment and exploration program, the objective was to determine the amount of material sampled, confirm the correct operation of the plant, the concentrate generated, record any significant numbers of diamonds recovered, and to take audit samples of the tailings streams which could then be sent to an outside laboratory to be checked for micro-diamonds which may have been being missed by the plant.

Results of Initial Bulk Sampling

The results of the initial 2000 ton bulk samples taken from the surface of both blows produced very few diamonds, and of those recovered, a vast majority were from the South Blow. The low recovery in this initial work did not allow for an overall grade for each sample to be determined, nor did Management elect to incur the added cost and requirements associated with the full 43-101 reporting requirements associated with independently evaluating each of the diamonds found as it would represent no benefit at this time. It was reported by MPH that only the quality of the stones recovered was encouraging from this initial first, surface bulk sample of the South Blow, and Management will again use these observations in its determination to acquire additional samples which could define areas that contain better grades than the surface work completed.

The results of all laboratory work and the bulk sampling were consistent, and point to both the North and South Blows having low diamond grades. Of the two, the South Blow clearly has slightly better potential, and this is where Management expects the immediate focus of any future efforts will be.

The rock treated from the South Blow was very weathered, near surface, material only. The spoil from the deeper vertical shaft identified by MPH in the South Blow shows that a darker, fresher lamproite may be present at depth. The Prospector's workings as mentioned in the historical research were proposed to be at the measured depth of the existing shaft, approximately 45 m below surface. Definitive results will only be able to be established through an additional independently monitored program which would need to be performed at that deeper level.

Report Recommendations for North and South Blows

It was the recommendation of the MPH report that due to poor results no further work is recommended on the North Blow.

The recommendation of the MPH report on the South Blow is that the 45 m southern vertical shaft be inspected with a view to reequipping it, and using it to obtain a bulk underground sample of fresh lamproite. The shaft is clearly sunk either within the South Blow or very close to its margin. The objective given was to recover and process approximately 2,000 tonnes of additional rock. Given the hardness of the material, additional crushing capacity would be required if the sample was to be treated in the So Ver plant. Such a sample, although too small for a statistical assessment of diamond value (given the likely low grade) would nevertheless confirm or deny the possibility of any quality resource at depth. The availability of the shaft, from which drives could be constructed into the lamproite, should greatly mitigate the cost of this work.

Conclusion / Management Overview

Diamcor Management believes that in completing this initial exploration work it has accomplished their stated goals, and that the information collected will now allow them to plan future stages in the Doornkloof exploration project. Consideration will now focus on the possible next steps, and the costs and methods associated with the suggested further sampling work, along with the possibility of additional geological methods which may be used in a continued effort to identify the potential of the property. The MPH report suggested to Management that identification of grade and quality of any possible diamonds present at deeper levels, and the intersection of, or identification of any postulated dyke, might best be achieved by another deeper bulk sampling from the vertical shaft that is present. The Company agrees that this appears to be the logical next step in the program, and it will now review its options associated with those additional programs.

Statements about the Company's future expectations and all other statements in this press release other than historical facts are "forward looking statements". The Company intends that such forward-looking statements be subject to the safe harbours created thereby. Since these statements involve risks and uncertainties and are subject to change at any time, the Company's actual results may differ materially from the expected results.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.

SOURCE: Diamcor Mining Inc.

Mr. Wayne Wolf, President & CEO
Diamcor Mining Inc.
Phone: (250) 862-3212
Website: www.diamcormining.com