BRC DiamondCore and Rio Tinto sign Letter of Intent for Rio Tinto to earn in to BRC DiamondCore's five northern DRC projects



    Rio Tinto can earn a 60% interest in a project by spending US$13 million
    on the project

    TSX: BCD
    JSE: BCD

    TORONTO, and JOHANNESBURG, South Africa, June 12 /CNW/ - BRC DiamondCore
Ltd. ("BRC" or the "Company") (TSX - BCD; JSE - BCD) announces that the
Company has signed a Letter of Intent with Rio Tinto Mining and Exploration
Limited ("Rio Tinto"), whereby Rio Tinto can earn a 60% interest in the
Company's five diamond exploration projects (the "Northern Projects") in the
northern Democratic Republic of the Congo (the "DRC") under a staged earn-in
arrangement.
    These five Northern Projects relate to a total of 106 exploration permits
covering approximately 27,000 square kilometres in the Equateur and Oriental
Provinces in the northern DRC. It is believed that the region's geology, which
represents an extension of the Mboumou Craton from the Central African
Republic, is prospective for the hosting of kimberlite pipes. Alluvial
diamonds are currently being recovered in this region.
    Under the proposed arrangement, Rio Tinto would fund an exploration
program with the objective of finding and defining kimberlite ore deposits
capable of economic development. The Letter of Intent contemplates the
following three phases:

    Reconnaissance Phase. Rio Tinto contributes US$550,000 towards the
initial reconnaissance sampling phase to be completed by BRC by year-end 2009.

    Phase 1 Exploration. Upon completion of the reconnaissance phase and
receipt and interpretation by Rio Tinto of all reconnaissance sample results,
Rio Tinto has the exclusive option to earn an initial 35% interest in
whichever Northern Project Rio Tinto selects by spending US$3 million in
exploration expenditure on each of the projects it selects by no later than
December 31, 2012. Rio Tinto may elect to earn this 35% interest in multiple
Northern Projects by spending the said US$3 million on each Northern Project
selected by Rio Tinto by no later than December 31, 2012. This Phase 1
exploration program will be as agreed upon by the parties and will be operated
by BRC.

    Phase 2 Exploration. Upon completion of Phase 1 exploration on a Northern
Project, Rio Tinto would then have the right to earn an additional 25%
interest in the applicable Northern Project by spending an additional
US$10 million in exploration expenditure on each project by no later than
December 31, 2014. At the point during Phase 2 exploration where a kimberlite
requires the first bulk sample, BRC would hand over operation of the bulk
sampling program to Rio Tinto.

    Following Phase 2 exploration, a joint venture company would be formed
with Rio Tinto holding a 60% interest and BRC holding a 40% interest.
    The above proposed earn-in arrangement is subject to various conditions,
including completion of due diligence and negotiation and execution of a
definitive agreement between the parties.
    This proposed earn-in arrangement applies solely to BRC's northern DRC
projects and does not impact the Company's major DRC projects of Tshikapa,
Kwango River and Lubao.
    Company President, Dr. Mike de Wit, said: "We are very pleased to be
joint-venturing with such a highly respected mining company as Rio Tinto on
the exploration of these promising diamond projects. Both companies are of the
view that these properties are highly prospective for the hosting of
diamondiferous kimberlites."

    Rio Tinto is a leading international mining group headquartered in the
United Kingdom, combining Rio Tinto plc, a London and NYSE listed company, and
Rio Tinto Limited, which is listed on the Australian Securities Exchange.
Rio Tinto's business is finding, mining and processing mineral resources.
Major products are aluminium, copper, diamonds, energy (coal and uranium),
gold, industrial minerals (borax, titanium dioxide, salt, talc) and iron ore.
Activities span the world but are strongly represented in Australia and
North America with significant businesses in South America, Asia, Europe and
southern Africa.

    BRC DiamondCore Ltd. is an African-focused diamond explorer active in
South Africa and the DRC. Led by a management team with extensive experience
in diamond exploration and mine development, the Company has a broad spectrum
of projects ranging from advanced stage trial mining operations through
grass-roots exploration. The Company's projects comprise both prospective
alluvial gravels and primary kimberlite targets. The Company works in a
systematic and responsible manner to discover, assess and develop diamond
resources for the benefit of its shareholders and local stakeholders.

    This press release contains forward-looking statements. All statements,
other than statements of historical fact, that address activities, events or
developments that the Company believes, expects or anticipates will or may
occur in the future (including, without limitation, statements relating to the
exploration of the Northern Projects pursuant to the proposed earn-in
arrangement with Rio Tinto, potential mineralization and plans and objectives
with respect to the exploration and development of the Northern Projects) are
forward-looking statements. These forward-looking statements reflect the
current expectations or beliefs of the Company based on information currently
available to the Company. Forward-looking statements are subject to a number
of risks and uncertainties that may cause the actual results of the Company to
differ materially from those discussed in the forward-looking statements, and
even if such actual results are realized or substantially realized, there can
be no assurance that they will have the expected consequences to, or effects
on the Company. Factors that could cause actual results or events to differ
materially from current expectations include, among other things, failure to
conclude the proposed earn-in arrangement with Rio Tinto as a result of one of
the conditions to such conclusion not being fulfilled (including failure to
execute a definitive agreement between the parties), the possibility that
future exploration results will not be consistent with expectations, changes
in equity markets, changes in diamond markets, foreign currency fluctuations,
political developments in the DRC, changes to regulations affecting
exploration or development activities, uncertainties relating to the
availability and costs of financing needed in the future, delays in obtaining
or failure to obtain required project approvals, the uncertainties involved in
interpreting geological data and the other risks involved in the diamond
exploration business. Any forward-looking statement speaks only as of the date
on which it is made and, except as may be required by applicable securities
laws, the Company disclaims any intent or obligation to update any
forward-looking statement, whether as a result of new information, future
events or results or otherwise. Although the Company believes that the
assumptions inherent in the forward-looking statements are reasonable,
forward-looking statements are not guarantees of future performance and
accordingly undue reliance should not be put on such statements due to the
inherent uncertainty therein.




For further information:

For further information: please visit our website,
www.brc-diamondcore.com, or contact: In Toronto: Martin D. Jones, Vice
President, Corporate Development, at (416) 366-2221 or 1-800-714-7938; In
Johannesburg: James Duncan, Russell & Associates, at 27 11 880-3924

Organization Profile

BRC DiamondCore Ltd.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890