FOR: DIADEM RESOURCES LTD.
ME SYMBOL: DIR
MAY 18, 2000
Diadem Resources Ltd.: Press Release
TORONTO, CANADA--DIADEM RESOURCES LTD. (DIR.ME) is pleased to
announce it has accepted a proposal from Phelps Dodge to carry out
exploration on the Bilbao property in Mexico.
According to the terms of the proposal Phelps Dodge can earn a 70%
interest in the property by (i) paying Diadem U.S. $10,000 upon
signing; (ii) paying U.S. $50,000 on the first anniversary date;
(iii) maintaining the property in good standing by paying taxes
and filing required proof of work; and (iv) completing a
feasibility report and necessary exploration work within a
five-year period. Phelps Dodge will have the right to terminate
at any time. Diadem will retain a 28% carried interest until
completion. The final agreement is subject to approval of The
Montreal Exchange.
The Bilbao property contains skarn zinc deposits. In a
pre-feasibility report dated September 1997 Kilborn SNC-Lavalin
outlined one pit that contains resources of 2.44 million tonnes at
3.72% zinc, 0.39% copper, 0.033% cadmium, plus lead and silver for
a zinc equivalent of 4.46%. The waste-to-ore strip ratio is 2.6:1
by weight. It is estimated a capital cost of U.S. $20.02 million
could be paid back over three years. This deposit occurs within a
near-surface oxide zone. There has been no drilling in the
sulphides below this deposit. Several strong gravity survey
anomalies are also targets for exploration.
As indicated in the press release of May 12th joint venture
proposals have been received on other Diadem projects and are
currently being negotiated. There can be no certainty that these
discussions will result in any agreement or transaction. The
Company will communicate any material announcement in due course.
On May 1st 1,250,000 options were allocated under the Company's
stock option plan to a director, two employees and one service
provider.
Diadem Resources Ltd. is a Toronto-based mineral exploration
company with interests in a diamond discovery in California, an
advanced zinc project in Indonesia; zinc, copper-nickel-cobalt
properties in Quebec; gold property in Nicaragua; and base metal
and silver properties in Mexico.
On behalf of the Board
A.C.A. Howe, President
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