Vaaldiam Resources Ltd.
TSX VENTURE : VAA

Vaaldiam Resources Ltd.

October 17, 2005 10:00 ET

Rio Tinto Starts Mini-Bulk Sampling Program on Vaaldiam's Pimenta Bueno Property

TORONTO, ONTARIO--(CCNMatthews - Oct. 17, 2005) - Vaaldiam Resources Ltd. (TSX VENTURE:VAA) reports that Rio Tinto Desenvolvimentos Minerais Ltda. ("Rio Tinto") has started collecting a 50 tonne mini-bulk sample of the diamondiferous Cosmos 1 kimberlite, a 2.5 hectare pipe situated on Vaaldiam's Pimenta Bueno diamond property in the State of Rondonia, Brazil. The Cosmos 1 pipe is located on the northern edge of a cluster of nine kimberlite pipes that are currently being evaluated by Rio Tinto.

A reverse circulation drill rig has been mobilized to the property to collect the mini-bulk sample from the Cosmos 1 pipe, and additional pipes now being prioritized for sampling. The proposed program will involve the collection of approximately 50 tonnes of kimberlite from holes which will be drilled to test the diamond distribution within different portions of the pipe. Rio Tinto recently completed a delineation program at Cosmos 1, which involved the completion of five core holes testing the margins of the diamond-bearing pipe, and a detailed gravity survey which together confirmed that Cosmos 1 pipe has a surface area of approximately 2.5 hectares.

The kimberlite that is recovered in each of the RC drill holes will be collected in ore bags, which will be sealed with a numbered security tag for shipment to Rio Tinto's laboratory facility in Brasilia. Composite samples, which will be logged and separated based on the geology of the kimberlite, will be crushed and processed through one of Rio Tinto's two 1 tonne-per-hour Dense Media Separation plants to produce a diamond-bearing mineral concentrate. The diamonds will be manually recovered from the mineral concentrate in a secure environment.

Delineation drilling has also been completed at the Pepper 3 and Pepper 1 pipes. At the Pepper 3 pipe, a total of 409 meters of kimberlite has been intersected in three vertical holes, and one inclined core hole, testing the pipe to a depth of up to 200 metres. All four holes were terminated in kimberlite. One additional vertical hole (PBDD-09), which was the first of the series of drill holes at Pepper 3 and was designed to test the northern margin of the pipe, failed to intersect kimberlite. Hole PBDD-11, which was collared at the same location as PBDD-09 and drilled in a southerly direction intersected kimberlite at a vertical depth of approximately 70 metres. These completed core holes successfully delineated the northern and southern margins of the diamond-bearing Pepper 3 pipe, and coupled with the results of a detailed gravity survey, indicate that the Pepper 3 pipe has a surface area of approximately 17 hectares. The following table provides a summary of the delineation drilling completed at the Pepper 3 pipe.



---------------------------------------------------------------------
Kimberlite (m)
----------------------
Hole
Hole No. Azimuth Inclination From To Total Length
(m)
---------------------------------------------------------------------
PBDD-09 Not Applicable vertical n.a. n.a. n.a. 127.75
---------------------------------------------------------------------
PBDD-11 180 45 degrees 96.15 193.00 96.85 193.00
---------------------------------------------------------------------
PBDD-15 Not Applicable vertical 56.80 134.95 78.15 134.95
---------------------------------------------------------------------
PBDD-16 Not Applicable vertical 51.70 200.00 148.30 200.00
---------------------------------------------------------------------
PBDD-17 Not Applicable vertical 53.10 139.00 85.90 139.00
---------------------------------------------------------------------


Two inclined core holes and one vertical hole were completed at the Pepper 1 pipe, situated 500 meters to the SE of the Pepper 6 pipe. A total of 277 metres of kimberlite has been intersected in two holes which tested the pipe to a vertical depth of approximately 200 metres. Both of the drill holes were terminated in kimberlite. Hole PBDD-12, a vertical hole which was collared at the same location as PBDD-13, failed to intersect kimberlite These core holes were completed to obtain a 500kg core sample for microdiamond analysis. The following table provides a summary of the delineation drilling completed at the Pepper 1 pipe, which is estimated to be 2 hectares in surface area.



---------------------------------------------------------------------
Kimberlite (m)
--------------------------
Hole
Hole No. Azimuth Inclination From To Total Length
(m)
---------------------------------------------------------------------
PBDD-10 180 75 degress 17.00 165.95 148.95 165.95
---------------------------------------------------------------------
PBDD-12 Not Applicable vertical n.a. n.a. n.a. 51.35
---------------------------------------------------------------------
PBDD-13 270 55 degrees 108.60 236.55 127.95 236.55
---------------------------------------------------------------------


The delineation drilling program is now underway at the Cosmos 3 and adjacent Cosmos 4 pipes, situated 5km to the south of the Cosmos 1 pipe.

Up to nine pipes are expected to be tested in the delineation drilling program, including the diamond-bearing Pepper 4 and 13 pipes as drilled by Vaaldiam in April.

Vaaldiam is a Canadian based diamond exploration company primarily involved in the exploration and development of the 176,000 hectare Pimenta Bueno diamond property in the state of Rondonia, Brazil. On June 6, 2005 Rio Tinto exercised an option to acquire a 51% interest in the Pimenta Bueno diamond property. Under the terms of the agreement, Rio Tinto can acquire a 51% interest in the southern two-thirds of the property by spending a total of US$5.0 million on exploration over a three year period. Rio Tinto can also earn a 51% interest in the northern one-third of the Pimenta Bueno property by spending a total of US$7.5 million on exploration over three years.

This release has been reviewed by Jose Ricardo Pisani, Vice President, Exploration for Vaaldiam Resources Ltd., who is a qualified person under National Instrument 43-101.

The TSX Venture Exchange does not accept responsibility for the adequacy or the accuracy of this release.

Contact Information

  • Vaaldiam Resources Ltd.
    Ken Johnson
    President & CEO
    (416) 363-6927
    or
    Vaaldiam Resources Ltd.
    Janet Reid
    Manager, Investor Relations
    (416) 363-6927
    www.vaaldiam.com