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To: Taki who wrote (119303)	9/12/2003 12:08:54 PM
From: Jim Bishop	Respond to of 150070

DTCT .20 x .23 Diatect Sells Mining Rights for $31 Million; Transaction Significantly Strengthens Company's Balance Sheet Friday September 12, 9:02 am ET HEBER, Utah, Sept. 12 /PRNewswire-FirstCall/ -- Diatect International Corporation (OTC Bulletin Board: DTCT - News) announced today the sale of 90% of its rights to a diatomaceous earth (DE) mining site in Oregon for $31.1 million. Under the terms of the agreement, the company will receive $1,945,350 a year through 2021 beginning September 1, 2005. The transaction was previously announced on August 13, 2003. The company currently expects to recognize an extraordinary gain of approximately $0.62 per share on this transaction. The actual gain, estimated at $31,000,000, may be subject to further modifications concerning reserves or impairment of financial assets, but at this time management believes any such modification would be of minimal consideration. The transaction will be reflected in the company's third quarter 10-Q filing with the Securities and Exchange Commission. Diatect has approximately 49.9 million shares outstanding on a fully diluted basis. The mining rights were purchased by Diatomaceous Earth Deposits of Virginia, LLC in an agreement that gives Diatect first rights to the mined minerals from the site. Diatomaceous Earth Deposits of Virginia is co-owned by Michael P. McQuade, an outside director of Diatect. Diatomaceous earth is an essential ingredient used in production of the company's EPA-labeled non-toxic insect control products. The extensive ore reserve, which has been proven by core drilling, trenching and laboratory analysis, is located near established infrastructure. The company acquired the mineral rights to the 640-acre site near Vale, Oregon in September 2001 through a claim granted by the U.S. Bureau of Land Management, which owns the land. The mineral rights to the Vale site are renewable on an annual basis. Diatect CEO Jay Downs said, "This transaction has significantly impacted our balance sheet by appropriately reflecting the true value of this asset to our company. Although the mine has been under our control for two years, due to GAAP accounting rules we have never been able to appropriately reflect the value of this asset on our books." Downs said, "In addition to significantly strengthening our balance sheet, the agreement calls for Diatect to have first right of refusal to the materials from the mine at below market prices. Quality DE is critical of all of the company's insect control products. Our low cost of basic raw material will have a significant positive impact on our operating margins in the years ahead." DE, also known as diatomite or silicon dioxide, is an organic replacement for chemical insecticides. It is becoming increasingly important as numerous chemical pesticides are being withdrawn from the market due to health hazards. Diatomite is a mineral mined from the dry beds of prehistoric, fresh water lakes. DE is not a poison. It is composed of silicious shells of ancient algae that once existed in marine and fresh water. Ground diatomite consists of sharp-edged microscopic blades and spikes that cut insects' skins and shells and damage the watertight seal upon which the bug depends. DE literally draws an insect's life-sustaining fluid from it. DE is labeled by the Environmental Protection Agency (EPA) as safe for food production, water and the environment. The talc-like powder, which is harmless to mammals, birds and humans, sticks to insects on contact. Diatect products are an EPA-labeled new generation of non-toxic insect control products marketed for sustainable and organic food production. The company's Results(TM) line for fire ant, tomato and garden, pet powder and indoor markets is packaged for the over-the-counter market and consumer use. Diatect International Corporation is an insect control and natural resource company headquartered in Heber near Salt Lake City. The company's Diatect and Results(TM) products are sold into the multi-billion dollar agriculture, industrial, home and garden industry worldwide. An investment profile on Diatect may be found on the website www.hawkassociates.com/diatect/profile.htm For further information contact Diatect International Shareholder Services at (435) 654-4370 or email shareholderservices@diatect.com or Frank Hawkins or Julie Marshall, Hawk Associates, at (305) 852-2383. Email: info@hawkassociates.com. Detailed information about Diatect International Corporation can be found on the website www.diatect.com. Copies of Diatect press releases, SEC filings, current price quotes, stock charts and other valuable information for investors may be found on the website: www.hawkassociates.com/diatect. This announcement includes forward-looking statements that involve risk and uncertainties. While these statements are made to convey to the public Diatect's progress, business potential and growth prospects, readers are cautioned that such forward-looking statements represent management's opinion. Such statements are made based upon current expectations that are subject to risk and uncertainty. In particular, management's estimates of future revenue amounts and timing are based upon product delivery schedules, which may be subject to unforeseen delays. Diatect does not undertake to update forward- looking statements in this news release to reflect actual results of its marketing plan and changes in assumptions or changes in other factors affecting such forward-looking information. -------------------------------------------------------------------------------- Source: Diatect International Corporation