An agreement with Sominex, a company based in Zaire, gives South Atlantic Diamonds (VSE) the exclusive right to review seven diamond mining prospects in West Kasai.
The company is paying Sominex US$25,000 and is committed to spend at least US$50,000 on the properties during its 6-month review period.
South Atlantic can extend the review period for an additional six months by paying Sominex an additional US$75,000.
After its review, South Atlantic can choose six of the seven properties for joint venture. The joint-venture agreement will enable the company to earn a 90% interest in the properties by spending US$5 million over five years.
Sominex retains a 2.5% royalty on gross diamond sales, subject to advance royalty payments of US$200,000 in each of years one and two; US$250,000 in year three; US$350,000 in year four; and US$500,000 in every year thereafter.
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