26 June 2014
CONFIDENTIALITY AGREEMENT WITH RIO TINTO MINING
AND EXPLORATION LIMITED EXTENDED TO 2020
* Amendment Letter Signed with Rio Tinto to Extend Confidentiality Agreement
(with Back in Rights)
* Under the Confidentiality Agreement Confidential Information and Geological
Samples may be Made Available to Karelian by Rio Tinto
* 51 per cent. Back in Agreement with Rio Tinto for any Major Diamond or
Other Mineral Discovery in Finland
__________________________________________________________________________________
Karelian Diamond Resources plc ("Karelian") (AIM:KDR, ESM: KDR.I), the diamond
exploration company focussed on the Karelian Craton in Finland, is pleased to
announce that it has signed an amendment letter to extend the existing
Confidentiality Agreement (with Back in Rights), as announced on 22 July 2010,
with Rio Tinto Mining and Exploration Limited ("Rio Tinto") until 30 June 2020.
Under the Confidentiality Agreement, Rio Tinto may disclose to Karelian
confidential information and physical geological samples relating to
exploration in Finland for the purpose of Karelian considering that information
in relation to Karelian's potential and existing exploration programmes in
Finland.
In consideration of Rio Tinto disclosing the confidential information to it,
Karelian has agreed that Rio Tinto will have the option (exercisable at its
discretion) to earn a 51 per cent interest in any project identified by
Karelian in Finland by Rio Tinto paying the direct cash expenditures incurred
in developing the project subject to the following conditions:
1. For diamond projects the option will be triggered if Karelian completes 10
tons or more of bulk sampling for diamond exploration; and
2. For all other minerals the option will be triggered if Karelian discovers a
resource with an in situ value that is equal to or greater than 3 million
ounces of gold in a JORC compliant resource calculation.
The Karelian Craton, which is the focus of Karelian's exploration programme in
Finland extends across Finland and northwest Russia and is comparable in size
to the diamond rich Slave Lake Craton in Canada. Two world class diamond
deposits, Lomonosova and the Grib Pipe, have been discovered in the Russian
sector of the Karelian Craton and the Russian company, Alrosa, which is the
world's largest diamond miner, has indicated that this new diamond region will
represent almost all its future growth.
Professor Richard Conroy, Chairman,commented:
"I am delighted that thisConfidentiality Agreement with Rio Tintohas been
extended until 2020. This has been a very positive relationship in which the
confidential information and physical samples made available to Karelian have
been a majoraddition to Karelian's existing knowledge base and mineral
exploration programme and to its objective of making a major diamond discovery
in the Finnish sector of the Karelian Cratoncomparable to the world class
discoveries made on the Russian side."
Further Information:
Professor Richard Conroy, Chairman, Karelian Diamond Tel: +353-1-661-8958
Resources plc
Virginia Bull / Simon Clements, Sanlam Securities UK Tel: +44-20-7628-2200
Limited (Nomad)
Ger Heffernan, IBI Corporate Finance Limited (ESM Tel: +353-7662-34800
Adviser)
Jon Belliss, Hume Capital Securities plc (Broker) Tel: +44-20-3693-1470
Michael Padley, Lothbury Financial Services Limited Tel: +44-20-3440-7620
Don Hall, Hall Communications Tel: +353-1-660-9377
http://www.kareliandiamondresources.com