To: Walter who wrote ( 110) 3/4/1998 4:11:00 PM From: Claude Robitaille Read Replies (1) | Respond to of 140
Attention Business/Financial Editors: SPIDER RESOURCES INC. - KWG RESOURCES INC. - BRAZIL: CONTENDAS CORE IS DIAMONDIFEROUS MONTREAL, March 4 /CNW/ - Spider Resources Inc. (''Spider'') and joint venture partner KWG Resources Inc. (''KWG'') announce that the drill core recovered from hole 97-04 from the Contendas Structure in Brazil has been verified by Mineraux Indicateurs Almaz Inc. of Rouyn-Noranda, to contain diamond. Of the total core sent to the laboratory, 5.3 kilograms was classified as potentially diamond bearing and subsequently processed by attrition milling, heavy media separation, yielding one microdiamond. The host rock for this new diamond occurrence has been identified as ultramafic, plotting on various diagnostic charts between kimberlite and lamproite, but more towards the lamproite classification. This statement is based upon petrographic analysis, whole rock chemistry, probing of phlogopite, clinopyroxene and ilmenite as well as trace element analyses. The recovery of various heavy minerals during the processing of the core concurs that the intrusion is ultramafic, however Mineraux Indicateurs Almaz suggests that the rock might be further classified as a Type II kimberlite or an orangelte (both are potentially diamond bearing). Probing of the collection of heavy minerals from the attrition milling program may be warranted to address the academic issue of classification. The Contendas structure was first identified in late 1996 by air-photo interpretation and geological reasoning. The target structure is situated beside the Paranaiba River, upstream from numerous active alluvial diamond operations; therefore, the structure was classified as a high priority exploration target. Historically, during KWG's alluvial diamond program in late 1994 and early 1995, a 107 carat diamond was recovered amongst numerous other lesser size stones which subsequently sold for $US500,000; however, the operating cost (plus losses due to suspected theft of individual diamonds) for this alluvial property precluded the operation from being economical. It was speculated, in late 1995, that a current eroding primary source for diamond was nearby and upstream of the alluvial sites, since some of the reworked gravel was found to be quite diamondiferous. A site visit in December of 1996 verified that an eluvial (weathered bedrock) source for diamonds, as demonstrated by a large garimpo site, was situated within the Contendas topographic low which had recently been worked. It is reported by the surface landowner to Spider's manager in Brazil that this 3-4 hectare garimpo site yielded 5,000 carats of diamond in two short seasons from one deep (14 m) pit, however this site was shut down by the environmental section of the DNPM due to lack of proper permits and the use of large mechanized equipment coupled with environmental infractions and complaints by the surface landowner. The largest stone recovered in the old garimpo operation was also reported by the surface landowner to be a 65 carat diamond while the average was in the 1-2 carat size range. This garimpo site is within 100 meters of the collar of drill hole No97-04 which intersected the diamond bearing rock. Recent new garimpo workings in the eluvial material are located about 400 meters from the older much larger site and within 300 meters of hole No97-04. Spider management was present during three months of garimpo work in late 1997 and witnessed the recovery of thirteen marketable diamonds from the processing of approximately 15 cubic meters of eluvial material form two stratabound horizons (1m and 3m thick) in the pits representing the ''nouveau garimpo''. These thirteen diamonds collectively weighed 14.5 carats. The local sale of nine of these diamonds returned an average value of $US340 per carat. The diamond bearing stratabound horizons were interpreted as representing epiclastic tuff within a large lamproite crater; the presence of proximal diamond bearing lamproite dikes confirms this interpretation. A continuation of exploration program is being recommended to the Board of Directors for Spider estimated to cost $US500,000. Startup of this program is pending the Board's direction and approval. The program includes additional diamond drilling to attempt to identify the vent area for the lamproite intrusion which represents the feeder systems to the diamond bearing crater sediments, together with systematic pit sampling and processing of the upper tuffaceous beds within this diamond bearing crater. A further bulk sampling phase may be warranted as a result of the recommended initial program which would complete the earn in requirements for a 50% interest in this project from KWG, by completing $US1.8 million in expenditures prior to the end of 1998. To date, Spider has incurred expenditures of $US700,000. Spider is a diamond exploration company active in Canada and Brazil, currently trading on the ASE. KWG is a mining and exploration company active in Canada, the Caribbean and Far East Russia, currently trading (without quotation) on the CDN under the symbol KWGR. NO REGULATORY AUTHORITY WAS APPROVED NOR DISAPPROVED THE CONTENT OF THIS PRESS RELEASE -30- For further information: Mary Peschka, Spider Resources/KWG Resources, (416) 869-0626 This press release concerns more than one organization. To view releases from one of these organizations, please select from below. KWG RESOURCES INC. SPIDER RESOURCES INC.