MINING NEWS

RAPAPORT... Rex to Sell Belgian Subsidiaries
Shareholders of Rex Diamond Mining Corporation (RDMC) have approved the sale of the company’s Belgian subsidiaries, Rex Mining Company NV and Rex Diamonds NV, to Serge Muller, an officer, director and shareholder of RDMC, for $743,111.

Canada-based RDMC, which trades in rough and polished diamonds and manufactures diamond jewelry, explained that the main benefit of the deal would be the elimination of a $3.64 million debt owed by Rex NV to Muller. The sale closed on May 9.

Weather Slows Diavik Production
Diavik Diamond Mines Inc., operator of the Diavik mine in Canada, reported a 31 percent drop in diamond production to 1.8 million carats. The company attributed the drop to extremely cold temperatures during the first quarter, which affected equipment reliability and productivity. Preparation of the new open pit is continuing as planned, with diamond production expected to begin mid-year.

Underground development work remained largely on schedule, advancing the approximately 12 miles of access tunnels and ventilation raises. Diamond production from underground is scheduled to begin in 2009, and is expected to replace open pit mining by 2012. Diavik built on its strong safety record with zero lost-time injuries, two medical treatments and an all-injury frequency rate of 0.37 during the first quarter of 2008. Diavik has been awarded the John T. Ryan Regional Safety Trophy three times in its five years of operation.
Caldera Inks Merger With Western Australian Diamonds
Caldera Resources and Western Australian Diamonds (WAD), both based in Australia, agreed to a “friendly merger.” Under the terms of the transaction, Caldera Resources and WAD plan to merge their businesses into an entity called Amalco. The arrangement calls for each common share or convertible security of WAD to be exchanged for one common share or convertible security of Amalco, while each common share or convertible security of Caldera Resources will be exchanged for 0.20 of an Amalco common share. Caldera shareholders and the Toronto Stock Exchange (TSE) must approve the merger, as well as the completion of a private placement or other equity financing intended to raise a minimum of $4 million concurrent with the close of the transaction. Both Caldera and WAD have agreed to pay the other a break fee of $200,000 under certain circumstances if the transaction is not completed. An aggregate of 55,102,600 common Amalco shares will be issued and outstanding upon completion of the transaction.


Archangel Resumes Trading Shares
Archangel Diamond Corporation filed material change reports, allowing it to resume common shares trading on the TSX Venture Exchange under the symbol “AAD.V.” The reports provided information on the Verkhotina diamond project and the settlement Archangel has with De Beers Société Anonyme, OAO LUKOIL and OAO Arkhangelskoe Geologodobychnoe Predpriyatie. The filing also detailed the risks and uncertainties of the business and investment in Archangel securities. Requests for copies of the material change reports can be sent to Archangel at Suite 400 - 65 Overlea Boulevard, Toronto, Ontario, M4H 1P1, Canada.

Archangel filed a NI 43-101 technical report regarding the Verkhotina diamond project at the end of May. Archangel, OAO LUKOIL and De Beers signed agreements regarding the ownership and development of the Verkhotina diamond project on April 15, 2008. Archangel acquired 49.99 percent interest in OAO Arkhangelskoe Geologodobychnoe Predpriyatie, a Russian open joint stock company currently owned by LUKOIL, which holds the license to explore and mine the Verkhotina area. LUKOIL continues to own the remaining interest.

Article from the Rapaport Magazine - June 2008. To subscribe click here.