Vancouver, June 2, 2005 – Diamond Fields International Ltd. (TSX: DFI) is pleased to announce that it has entered into an exploration option and joint venture agreement with Inco Limited (“Inco”), the world’s leading nickel company, on its nickel project located on Ammassalik Island off the southeast coast of Greenland.
The agreement grants Inco the option to earn a 65% interest in the property by spending up to U.S. $3,000,000 on the property by December 31, 2008. DFI will retain a 35% interest after the earn-in is complete. Initial work under the agreement is planned for this summer.
The Ammassalik nickel project is centered on a discovery situated on the south coast of Ammassalik Island six kilometres southwest of Tasiilaq, East Greenland. The property has been explored for two years by DFI resulting in anomalous nickel showings over a wide area. Similarity to the Raglan and Thompson Ni mineralization has been confirmed by field mapping and subsequent geochemical and petrographic analysis. DFI believes that the next stage of exploration would best be handled by Inco, a world-class nickel company, with extensive exploration and development experience.
The Greenland Nickel Project was first acquired from a company controlled by Mr. Jean- Raymond Boulle, DFI’s largest shareholder. Recently, DFI announced the cancellation of the outstanding royalty obligations held indirectly by Mr. Boulle on various properties including the Greenland nickel project. Cancellation of these royalty obligations on the Ammassalik properties was a pre-requisite for the Inco transaction.
President and CEO of Diamond Fields, Mr. Gregg J. Sedun said, “This agreement with Inco represents a very important development for Diamond Fields’ exploration division as we believe Inco’s extensive nickel experience will greatly enhance the exploration of this project. Both companies are optimistic that this new project will prove to be beneficial for our mutual shareholders.”
Mr. Randal Cullen, Chief Geologist for Diamond Fields International is a Qualified Person as defined by National Instrument 43-101 and is responsible for program design and quality control of exploration undertaken by Diamond Fields.
DIAMOND FIELDS INTERNATIONAL LTD.
Gregg J. Sedun, President and Chief Executive Officer
For further information contact: Investor Relations (604-682-2113)
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in the Diamond Fields’ periodic filings with Canadian Securities Regulators. Such forward-looking information represents management’s best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Diamond Fields does not assume the obligation to update any forward-looking statement.