GRN.L Regulatory News (GRN)

13 Jul 2006 07:00

Gravity Diamonds Limited13 July 2006 RELEASED ON BEHALF OF: GRAVITY DIAMONDS LIMITED (ASX & AIM : GRN) 12 July 2006 GRAVITY IN NEW JOINT VENTURE DIAMOND SEARCH ON MALLAPUNYAH TENEMENT IN NORTHERN TERRITORY • Project Area Subject to Limited Testing by Previous Explorers • Region Hosts Economic Diamond Occurrences • Gravity Can Earn 80 percent Interest in Project Area's Diamond Rights Gravity Diamonds Limited reports that it has entered into a joint ventureinvolving the diamond exploration rights of Australian minerals explorer RedMetal Limited on the Mallapunyah silver, lead, zinc project in the McArthurBasin of the Northern Territory. The Mallapunyah project abuts the western boundary of the tenement containingGravity's new Abner Range diamond discovery. The company says that the southernMcArthur Basin is one of the few regions within Australia that hosts economicdiamond deposits - the Merlin diamond field lies only 80 kilometres east ofMallapunyah. Despite this, the Mallapunyah tenement area has had limited testingby previous diamond explorers with only a few wide-spaced drainage samplescollected to date, Gravity adds. Under the terms of the agreement, Gravity can earn 80 percent of the project'sdiamond rights by completing a pre-feasibility study within five years andsole-funding through a decision to mine and commencement of commercialproduction. If the project proceeds to this stage, Red Metal will pay its shareof development costs to Gravity from its 20 percent share of production. The information in this release has been compiled and reviewed by GravityDiamonds Limited's Managing Director, Phillip Harman BSc (Hons), who is a memberof The Australasian Institute of Mining and Metallurgy. Mr Harman has sufficientexperience which is relevant to the style of mineralisation and type of depositunder consideration and to the activity undertaken to be a qualified person forthe purposes of the AIM Guidance Note for the Mining and Oil and Gas Companiesissued on 16 March 2006. Further Information: Phil Harman, Managing Director, Gravity Diamonds Ltd. Tel: +61-3-9909-7655Elisa Bartlett, Assistant to the Managing Director, Gravity Diamonds Ltd. Tel:+61-3-9909-7655Ron Marshman/John Greenhalgh, City of London PR Ltd. Tel: 020-7628-5518 This information is provided by RNS The company news service from the London Stock Exchange