October 14, 2004
Peregrine Diamonds Ltd. (the “Company”) is pleased to announce that it
has signed an Option/Joint Venture Agreement (the “Agreement”) with BHP
Billiton Diamonds Inc. covering three diamond exploration properties in
the Western Churchill Geologic Province of Nunavut. Over the past year
and a half, the Western Churchill province has yielded multiple clusters
of diamond bearing kimberlite and has developed into the largest
staking rush in Canadian history. With this acquisition, and with the
acquisition of the Nanuq project through a proposed merger with Dunsmuir
Ventures Ltd. announced on September 30, 2004, Peregrine will be among
the largest landholders in this new diamond province.
Under the terms of the Agreement, Peregrine shall have, subject to
certain back-in rights by BHP Billiton, the right to earn a 65% interest
in the three properties by completing a $1 million grid-based till
sampling and prospecting program by October 13th, 2005. Peregrine may
earn a further 35% interest in the properties (for a total 100%
interest) by spending an additional $800,000 on exploration by December
31, 2005. Under Peregrine’s alliance agreement with BHP Billiton, the
latter has the option, under certain conditions on BHP Billiton
generated projects, to back-in ultimately to a 65% interest, by
refunding Peregrine between 300% and 400% of Peregrine’s exploration
expenditures, sole funding all expenditures through to the completion of
a feasibility study and by arranging all necessary funding to place a
deposit into commercial production.
The Dubwant Lake, Tulemalu, and Area 2 properties cover 1,134,086 acres,
1,481,870 acres and 704,994 acres respectively, and have been
identified by BHP Billiton through regional heavy mineral sampling as
being anomalous in kimberlite indicator minerals. The Dubwant Lake
property is known to contain the Outlet Bay Diatreme which is a deep
seated, mantle tapping body that, based on geochemical composition,
petrography and mineral chemistry, has kimberlitic or lamproitic
affinity. Dubwant Lake also contains a number of newly identified KIM
anomalies. At Area 2, BHP Billiton has recovered, among other
kimberlite indicators, a G-10 garnet containing more than 14.2 wt.%
Cr2O3 which is deemed to be of high interest for follow up exploration.
A $1 million heavy mineral sampling program was recently completed by
Dunsmuir personnel on the three property blocks. These samples are in
the process of being shipped to a commercial laboratory for analysis and
initial results are expected later this year.
For further information about both companies please contact Eric
Friedland at 604-408-8880 and Art Ettlinger at 604-681-6311 or visit
each company’s web site at: www.peregrinediamonds.com
On Behalf of Peregrine Diamonds Ltd.
Eric Friedland, President
On Behalf of Dunsmuir Ventures Ltd.
Art Ettlinger, President, CEO and Director
The TSX Venture Exchange has in no way passed upon the merits of the
proposed transaction and has neither approved nor disapproved the
contents of this press release.
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