2008


Diamcor Mining Signs Definitive Sale Of Assets Agreement For Purchase Of The De Beers Krone-Endora Project (Limpopo Province, South Africa)



December 22, 2008

December 22, 2008, KELOWNA, BC – Diamcor Mining Inc. (TSX-V:DMI) (the “Company”) is pleased to announce that its application for the Acquisition (as defined below) to the TSX Venture Exchange (the “Exchange”) has now received the necessary Exchange conditional approval required, and thus the Company has signed a definitive Sale of Assets Agreement (the “Agreement”) with De Beers Consolidated Mines Limited for the purchase of the Krone-Endora alluvial project (the “Project”).  The Company announced on May 26, 2008 that its proposal to acquire the Project for 14,000,000.00 Rand (Approx. $1,818,600.00 CND) had been approved by De Beers as the successful proposal (the “Acquisition”).  The Company previously announced on December 18, 2008 that all material terms of the agreement had been agreed upon, and the required Acquisition application had been submitted to the Exchange for its review and approval prior to the now finalized execution of the definitive Agreement.       

The Project is located immediately adjacent to the north side of the De Beers Venetia Diamond Mine in the Limpopo Province of South Africa on the De Beers owned farms Krone 104MS and Endora 66MS.  The Project consists of the alluvial fan sediments from the adjacent Venetia kimberlite pipes and covers an area roughly five square kilometres in size.  Based on published reports the Venetia Diamond Mine is widely known to be South Africa’s largest producer of diamonds at approximately 9.0 million carats per year.  De Beers had completed extensive exploration work on the alluvial flows from Venetia which occur on the two farms, however the project did not fit its current strategic focus and thus the deposit was chosen as one which would be made available to other parties and, more specifically, to emerging junior miners, explorers and Women in Mining groups.  The Acquisition will be completed through Diamcor’s South African subsidiary, DMI Minerals South Africa (Proprietary) Limited (“DMI Minerals”), which is 70% owned by Diamcor Mining Inc, and  30% owned by Diamcor’s Black Economic Empowerment partner Nozala Investments (Proprietary) Ltd (“Nozala”).  Nozala is a very broad-based 100% women-owned entity with an estimated 500,000 women shareholders.

The Acquisition was subject to the negotiation and execution of the recently completed definitive sale of assets agreement between DMI Minerals and De Beers.  Under the terms of the agreement DMI Minerals is required to provide an initial deposit payment of R1,500,000.00 (the “Deposit”) at the time of execution, and with the formal agreement now complete, the companies will immediately begin work to satisfy the conditions associated with closing. Conditions of closing include: the preparation, submission, and acceptance of applications to secure Ministerial consent for transfer of the associated prospecting rights from De Beers to DMI Minerals, the signing of a rights of access agreement to the properties between the parties, and together with that the transfer of the associated environmental and rehabilitation liabilities, the signing of a sole, royalty-free license for the use of the extensive geological data for the properties by DMI Minerals, the granting by the Department of Water Affairs and Forestry of a suitable water license to DMI Minerals, and a final payment of R12,500,000.00 upon completion or removal of all other conditions.  The Acquisition is a Reviewable Transaction and is therefore subject to regulatory approval by the Exchange.  As noted previously, the Company has submitted all appropriate related information to the Exchange to receive the required conditional approval to proceed with the Acquisition.  In order to obtain final Exchange approval, the Company will need to submit a NI 43-101 compliant report and any additional documentation as required or requested by the Exchange, as well as confirm that all conditions of closing have been met or removed.

As noted, the Project had been the subject of extensive exploration work previously completed by De Beers, the results of which were documented in a detailed internal mineral resource estimate.  Given the internal, non-public nature of this work and their findings, DMI Minerals plans to immediately begin the process of commissioning an initial independent NI 43-101 report for public release based on the findings provided by De Beers. Upon the closing of the sale of assets agreement, DMI Minerals plans to proceed with the continuation of evaluation work and development of the past bulk sampling in order to determine the work necessary to make production decisions with respect to the Project.

The Acquisition represents the Company’s first for its South African subsidiaries in conjunction with Nozala. This partnership, under which Nozala will have a 30% interest in DMI Minerals, has been designed to draw on the considerable synergies of DMI and Nozala, including the ability to provide broad-based economic benefits and support for junior mining and Women in Mining, as well as supporting the emerging South African diamond polishing industry with the planned contract polishing of suitable diamonds from the Deposit through the South African facilities of Nozala’s established subsidiary, Nozala Diamonds (Pty) Ltd.

“We are very pleased to announce the formal signing of an agreement with De Beers at a time when many in the industry are experiencing the unprecedented pressures of the current global financial crisis,” stated Mr. Dean H. Taylor, CEO of Diamcor Mining Inc. “It represents the hard work of both parties and a commitment by De Beers to support the efforts of junior mining and Women in Mining initiatives in South Africa, and given the Project’s proximity to Venetia, we are optimistic and committed to ensuring the transaction is a success story for all involved”, added Mr. Taylor.  

Diamcor Mining is a junior resource company with established operations and production history in South Africa.  The Company is determined to use this established operating history and industry knowledge to achieve economic production of diamonds through the development and/or acquisition of quality properties in the region.

On behalf of the Board of Directors

Mr. Dean H. Taylor
CEO
Diamcor Mining Inc.

Requests for additional information may contact:

Mr. Dean Taylor
CEO
Diamcor Mining Inc.

E-mail:             Dtaylor@diamcormining.com
Website:          www.diamcormining.com
Phone:             1 (250) 862-3212 Ext 206
Fax:                 1 (250) 862-3214

Or,

Mr. Tom Tweedy
External and Corporate Affairs
De Beers Corporate Headquarters

E-Mail:             Tom.tweedy@debeersgroup.com
Website:           www.debeersgroup.com
Phone:             +27 (0) 11 374-7173
Fax:                 +27 (0) 11 374-7000

This press release contains certain forward-looking statements. While these forward-looking statements represent our best current judgement, they are subject to a variety of risks and uncertainties that are beyond the Company’s ability to control or predict and which could cause actual events or results to differ materially from those anticipated in such forward-looking statements.  Further, the Company expressly disclaims any obligation to update any forward looking statements.  Accordingly, readers should not place undue reliance on forward-looking statements.  This news release is not for dissemination in the United States, to “U.S. Persons” or to United States of America news services.

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