The Diamond Page — SouthernEra increases exposure in Quebec

Junior SouthernEra Resources (TSE) has been busy completing deals to broaden its exposure to diamond plays in both northwestern Quebec and the Northwest Territories.

In Quebec’s Le Tac Twp., Ojibway Resources (ME) has signed a deal to acquire all the mining assets of Diabex, an 80%-owned subsidiary of SouthernEra.

Ojibway will receive 118 properties in northwestern Quebec, in return for which it must issue 200,000 treasury shares to Diabex and spend $1.5 million in exploration over three years ($500,000 must be spent within the next year). Furthermore, Ojibway will pay the roughly $850,000 owned by Diabex to SouthernEra.

After closing, SouthernEra will hold a 12.8% interest in Ojibway, be represented on the board of directors and have the option to participate in any future Ojibway financings. As well, SouthernEra can back-in for 49% of Ojibway’s interest in any diamond project and assume the role of operator. Diabex has already discovered a kimberlite in Ally Twp., 45 km northwest of Le Tac, and its holdings cover an additional 128 circular magnetic anomalies. In the Point Lake area of the Northwest Territories, SouthernEra has completed two deals.

In one agreement, it can earn 15% of the interest of Garden Lake Resources (VSE) and RJK Explorations (ASE) in the Point Lake property, which is under option from Aaron Oil (ASE). In return, it must spend $300,000 on exploration by Dec. 31.

In a second deal, SouthernEra can earn 20% of Aaron’s interest in Point Lake in exchange for interests held by SouthernEra in the Beniah Lake and Hidden Lake areas.

When all parties have fully vested their interests, the joint venture will be owned 25% by Aaron, 35% by SouthernEra, 20% by Garden Lake and 20% by RJK. Garden Lake and RJK will be the operators.

Processing and microprobe analysis of 394 overburden samples taken from the Point Lake-Humpy Lake claims is nearly complete. Drilling on selected targets is expected to begin sometime this month and work is also continuing on the Warburton Bay project, which is held 80% by Garden Lake and RJK and 20% by SouthernEra.

Elsewhere in the Northwest Territories

* Pure Gold Resources (TSE) has signed an agreement with Mill City Gold Mining (ASE) to earn a 20% interest in the Snare Lake claims. Mill City currently has a 25% stake in the property, which covers 76,400 hectares. Pure Gold can earn its interest, subject to a 1% net smelter royalty, by spending $200,000 on exploration prior to July 31 and a further $200,000 before Nov. 2.

Upon Pure Gold’s earning its interest, Ashton Mining (TSE) can earn a half interest from Pure Gold and its partners by funding target evaluation and bulk sampling.

* Four partners — Aur Resources (TSE), Thunderwood Resources (TSE), Consolidated Abitibi Resources (ME) and Jonpol Explorations (TSE) — have completed geophysical work and diamond drilling on the Basler and Pollock Lake projects northwest of Yellowknife.

Drill-testing of four high-priority magnetic anomalies failed to intersect kimberlite. The anomalies were apparently caused by either magnetic diorite, porphyritic intrusive rocks or weakly magnetic argillites.

Airborne and other data are being reassessed in an effort to identify other possible kimberlite sources.

* Caledonia Mining (TSE) reports that processing has been completed on more than a third of the samples collected from its coastal and river properties, which cover 485,640 hectares. Kimberlite indicator minerals have been found in about 30% of the samples tested. These samples, which were collected from the Coppermine River delta and the Coppermine River, are being tested for diamonds.

Caledonia has also obtained the results from a recent government bathymetric survey of Coronation Gulf. Indications are that there may be an ancient delta of the Coppermine River about 17 km offshore of the present delta, at a depth of 50 metres. This target lies within Caledonia’s claim area. In other news, Caledonia has reached an agreement with Ocean Diamond Mining of Cape Town, South Africa, whereby Ocean Diamond will provide consulting services with regard to the identification, testing and mining of offshore gravel deposits.

United States

* Advanced Projects (VSE) can earn a half interest in five properties owned by Rochester Minerals (VSE).

The properties, situated in Kansas, Kentucky and Arkansas, host several known kimberlites and the joint venture plans to perform diamond indicator work to test the targets further.

* General Electric (GE) and an affiliate of De Beers have been indicted by the U.S. Justice Department on charges of conspiring to fix the worldwide price of industrial diamonds. The two companies, which control more than 80% of world industrial diamond output, have denied collusion in a conspiracy which allegedly began in 1991 and was aimed at raising the price of diamond products.

The Justice department alleges that GE and De Beers co-ordinated price-fixing activities through their common ties with Belgium-based Diamant Boart, which is GE’s second-biggest customer (buying about U.S. $15 million in diamonds each year).

South America

* Richlode Investments (VSE) intends to join forces with a private Venezuelan company to acquire a concession in the southeastern state of Bolivar. Richlode is examining the property, which is reported to contain gold and diamond placer deposits, prior to signing a final joint-venture agreement. Elsewhere Overseas

* Scintilore Explorations (TSE) has given Fancamp Resources (VSE) the right to earn a half interest in its five prospecting licences in Botswana. The licences, known collectively as the Gemsbok Project, cover 4,832 sq. km. Airborne magnetic surveys will be followed by reverse circulation drilling. * Canadian Overseas Exploration (VSE) is also acquiring properties in southern Africa.

Two of the three concessions cover adjacent marine diamond concessions, and one of those is already producing roughly 100 gem-quality carats per month. Several gem-quality diamonds have also been found on the other property, which is on dry land and in the early stages of exploration. The company plans to continue work on the inner-shore marine concession and expects to spend $980,000 exploring and developing the other two properties. * Tan Range Exploration (ASE) plans to perform a large bulk-sample test on its Tabora concession in Tanzania.

A 5-tonne-per-day diamond wash plant has been ordered for the pilot test and, to date, 15 known kimberlites have been sampled. These yielded 88.96 carats from 648 tonnes of material.

A 5,000-tonne bulk sample will also be taken from the nearby Kahama concession, where previous small-scale miners produced about 140,000 carats with an indicated grade of about five carats per 100 tonnes.