FOR: CANABRAVA DIAMOND CORPORATION
VSE SYMBOL: CNB
AND PARAMOUNT VENTURES AND FINANCE INC.
VSE SYMBOL: PVF
MARCH 18, 1999
Canabrava and Paramount to Develop Rio do Sono Alluvial
Diamond Deposits, Brazil
VANCOUVER, BRITISH COLUMBIA--Canabrava Diamond Corporation (CNB-V)
and Paramount Ventures and Finance Inc., (PVF-V) are pleased to
announce that the two companies have signed a joint venture
agreement to develop the alluvial diamond deposits on Canabrava's
100 percent owned Rio do Sono Property, Brazil. The Rio do Sono
alluvial diamond property is comprised of approximately 15,000
hectares of exploration concessions located near the town of
Paredao do Minas, 300 kilometres south of Brasilia in the State of
Minas Gerais.
Under the terms of the Agreement, Paramount will spend U.S. $1
million to earn a 50 percent interest in the Rio do Sono Project.
Once Paramount has earned a 50 percent interest, the joint venture
will fund ongoing costs on a pro-rata basis. The joint venture
has engaged the services of Baines & Co. to be the Project
Manager. Baines & Co., have successfully run alluvial diamond
operations in Sierra Leone, Angola and in the Central African
Republic. Upon recovery of alluvial diamonds from the Rio do Sono
Project, net operating profits will be shared initially as to 45
percent Canabrava, 45 percent Paramount and 10 percent Baines &
Co. When Paramount receives the equivalent of U.S. $1 million
from its 45 percent share of net operating profits, the
distribution will thereafter be 50 percent Canabrava, 40 percent
Paramount and 10 percent Baines & Co. Canabrava will be the
operator and have the right to market the diamonds.
The Property encompasses over 40 square kilometres of diamond
bearing terrace, paleochannel and active river channel gravels
where local miners have been recovering diamonds for more than 150
years. Large diamond bearing terraces, old river channels and
numerous active river channel traps have been inaccessible to the
local miners due to a lack of any mechanized equipment. Terrace
gravels are between 2 and 12 metres thick while older river
channel gravels are much thicker. Four sets of rapids within the
Property concessions host hundreds of untouched trap sites and
these areas will be the immediate focus of development.
Historical production from the Property is unknown, however
published reports together with work completed by Canabrava have
indicated grades of the terrace and old river channel gravels
varying from 0.15 to 0.30 carats per cubic metre. One bulk sample
taken in an active river trap returned 3.0 carats per cubic metre.
Average stone size is 0.3 to 0.5 points and the largest recovered
stone reported to be 18 carats. Historical values of Rio do Sono
diamonds is U.S. $140 per carat. Work will begin immediately.
Canabrava Diamond Corporation is actively exploring for diamonds
in Brazil and Canada and looking at other opportunities worldwide.
The Company is 59.6 percent owned by Southwestern Gold
Corporation (SWG-T). Paramount Ventures and Finance Inc. is a well
financed junior exploration company with copper and gold projects
located in Argentina and diamond projects located in Brazil and
Canada.
Rory O. Moore, President
Canabrava Diamond Corporation
Jim Owen, Director
Paramount Ventures and Finance Inc. |
