Trigon selling diamond assets to Diamondex (June 25, 2007)

Vancouver — Solidifying a recent move towards uranium and away from gems, Trigon Uranium (TEL-V, TELWF-O) has inked a deal to sell its diamond exploration portfolio to Diamondex Resources (DSP-V, DMDXF-O).

For the basket of properties, Diamondex is paying just over $3.2 million comprised of a non-refundable $25,000 cash deposit and 6.4 million shares. Should the shares trade below 50 apiece on a 30-day average basis, Diamondex will issue additional shares (to a maximum of 3.6 million) on July 15 to balance the difference.

Trigon has spent about $11 million in exploration on its diamond portfolio of six projects located in northern Ontario’s James Bay Lowlands and the Slave and Rae cratons in the Northwest Territories and Nunavut.

The Weiland project, a 40-60 joint venture with De Beers, is situated in the Kyle Lake kimberlite cluster in the James Bay Lowlands, about 120 km west of the major’s Victor project. Trigon also has more than 16,000 sq. km of claims in northwestern Ontario, including its Viking property, where it has collected a number of kimberlite indicator minerals, suggesting a source may be nearby.

Trigon holds 46.79% of the RAM and SHU properties, located about 140 km northeast and 120 km east of Yellowknife, N.W.T., respectively, in a joint venture with Stornoway Diamond (SWY-T, SWYDF-O), which holds the remainder of the projects. The partners have been exploring favourable regions of thick lithospheric crust and possible source areas of mantle-derived indicator minerals.

Southeast of Kugaaruk in Nunavut, Trigon holds a 46.67% stake in the IC project (with the balance held by Stornoway) and 51% of the TIM property, a JV with Committee Bay Resources (CBR-V, CBYRF-O).

“The intention is that the entire (Trigon) diamond team will be moving with the assets,” says Sidney Himmel, Trigon Uranium president and CEO.

The acquisitions will further bolster Diamondex’s large portfolio of diamond projects in the Northwest Territories, Nunavut, Saskatchewan and Alberta.

“I would be particularly excited about Diamondex because what you have now is a couple of famous mine finders (Randy Turner and Ray Ashley) in there,” Himmel continues. “I think you have one of the top diamond exploration companies in Canada.”

Trigon moved into uranium exploration in early 2006, acquiring a number of advanced projects in Utah.