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Gold/Mining/Energy : SOUTHERNERA (t.SUF) -- Ignore unavailable to you. Want to Upgrade?

To: Confluence who wrote (1395)	6/4/1998 12:57:00 AM
From: Rocky510	Read Replies (1) \| Respond to of 7235

From the Financial Post, June 4, 98: canoe.ca Thursday, June 4, 1998 SouthernEra now faces joint diamond venture By PETER KUITENBROUWER The Financial Post SouthernEra Resources Ltd. yesterday gave up its five-month battle for total control of a disputed diamond cache in South Africa and opened the door to a joint venture with its sworn enemy De Beers Consolidated Mines Ltd. "What I believe is SouthernEra will get a share of Marsfontein, as part of a joint venture or even a separate [company] between De Beers and SouthernEra," president Chris Jennings told investors in a conference call from Johannesburg. De Beers has agreed to sell those diamonds through the South African Diamond Board, rather than its Central Selling Organization, he said. That means up to 25% more for each diamond, although Southern-Era would have to split its share of proceeds with partner Randgold & Exploration Co. Jennings insisted, though, SouthernEra will maintain complete control of diamond rights at the rest of its Klipspringer project in Northern Province. Jennings also said the company has promising investments in Angola. But he revealed that on May 22, bandits ambushed company vehicles, killing SouthernEra's chief of mining operations, Frank Gobler. Gobler's driver and bodyguard were also wounded. Jennings called Gobler's death a "terrible tragedy," but insisted it would not dissuade SouthernEra from pursuing lucrative diamond deposits in Lunda Norte province. The National Union for the Total Independence of Angola had for decades financed its rebel war largely through diamond mining in that region. "If this was intimidation by UNITA to stop us from further mining in Angola it won't happen," he said. Also in Angola is DiamondWorks Ltd., controlled by Canadian mining financier Robert Friedland. DiamondWorks is on the verge of diamond production at its Yetwene property in Lunda Norte. A spokesman said it hasn't had problems with violence. But Mark Cramb, spokesman for Starpoint Goldfields Inc. of Vancouver, previous owner of Yetwene, said Angola can be dangerous for diamond miners. "Anybody can mine diamonds in Angola, but very few people can get them out [of the country], because somebody's going to grab them." Last year, SouthernEra became operator of a five-year joint venture at Camafuca-Camazambo, which it calls "the largest undeveloped diamondiferous kimberlite pipe in the world." If that venture turns into a diamond mine, SouthernEra gets 51%. It spent $3.1 million in Angola last year and has budgeted $3.2 million this year. Investors said yesterday's conference call renewed their faith. "Last night after I saw what happened to the stock I thought, 'Do we have another Bre-X here?' " said Marino Sardone, a small investor. "But after hearing the company tell the good news I feel much better about the stock." The stock (SUF/TSE) closed at $5.40 yesterday, up 15›. -- with files from Paul Bagnell/FP