Diamondex, Shore to drill 14,000 m at Buffalo Hills

2007-12-06 10:42 ET - News Release

See News Release (C-DSP) Diamondex Resources Ltd

Mr. Randy Turner of Diamondex reports

DIAMONDEX RESOURCES/SHORE GOLD ANNOUNCE BUFFALO HILLS EXPLORATION PROGRAM

Diamondex Resources Ltd. and Shore Gold Inc. are planning a $7-million exploration program for the Buffalo Hills project located in Northern Alberta. (See Diamondex's website for project location and description.)

Under this exploration program, a 14,000-metre delineation drill program will focus mainly on the central corridor of the Buffalo Hills property. This program will commence in the north at K91 and work progressively south to BH225, K14, K252, K6 and ultimately K5. It is anticipated that the drilling will begin in late January, 2008, and will take approximately three months to complete.

The primary goal of the program is to drill test the best kimberlite pipes discovered to date with sufficient density to allow for the identification of the different kimberlite phases present and characterize their key characteristics, including microdiamond content, to allow for the construction of accurate geologic models. This exploration program will provide key information that will prioritize which pipes on the Buffalo Hills project should be bulk sampled during follow-up campaigns. Encore Coring & Drilling of Calgary, Alta., will provide two Schramm 685 drills capable of routinely recovering PQ-sized drill cores. All drill cores will be logged and analyzed at Shore's facilities in Saskatchewan.

Diamondex and Shore acquired Stornoway Diamonds Corp.'s share of this project in July, 2007, for a total cash consideration of $17.5-million. Pursuant to the acquisition, Shore and Diamondex each acquired a 22.5-per-cent interest in the Buffalo Hills joint venture, in which Encana Corp. holds a 43-per-cent interest and Pure Diamonds Exploration Inc. holds the remaining 12-per-cent interest. Diamondex and Shore can increase their combined interest to 72.5 per cent by spending $15-million prior to April 30, 2010. Diamondex is the operator of the Buffalo Hills joint venture with Diamondex and Shore each contributing 50 per cent of the exploration expenditures.

The Buffalo Hills project is the third-largest known district of significantly diamond-bearing kimberlite in Canada after Lac De Gras in the Northwest Territories and Fort a la Corne in Saskatchewan. Previous exploration on this project by Ashton Mining, Encana and Pure Diamonds from 1997 to 2006, totalled $30-million, which resulted in the discovery of 38 kimberlites, 26 of which are diamondiferous. These kimberlites range in size from one to 47 hectares. Six mini-bulk samples were also carried out, with the largest bulk sample conducted at K14 where 479 tonnes were extracted yielding a grade of 12 carats per hundred tonnes. A 22.8-tonne sample extracted from K252 yielded a grade of 55 cpht.