Stock Symbol: DIAM: TSX
SASKATOON, SK, June 21, 2021 /CNW/ - Star Diamond
Corporation ("Star Diamond") today provided an update on the
ongoing litigation (the "Legal Proceedings") between Star Diamond and Rio Tinto Exploration Canada
Inc. ("Rio Tinto Canada") in the Court of Queen's Bench for
Saskatchewan (Judicial Centre of
Saskatoon) (the "Court").
As previously disclosed, on June 4,
2021, the Court held a hearing in respect of the undertaking
(the "Undertaking") previously provided by Rio Tinto Canada to the
Court. The Court reserved its decision, which is expected in
the coming weeks.
Notwithstanding that the Court has not yet released its decision
in respect of the Undertaking, on June 17,
2021, Rio Tinto Canada delivered a notice to Star Diamond purporting to call, for
July 21, 2021, a meeting of the
management committee of the joint venture that Rio Tinto Canada
claims was previously formed between Star
Diamond and Rio Tinto Canada. As previously disclosed,
Star Diamond believes that no such
joint venture has been formed because Rio Tinto Canada's
November 2019 purported exercise of
its options under the Option to Joint Venture Agreement dated
June 22, 2017 between Star Diamond and Rio Tinto Canada did not comply
with that agreement.
The June 17, 2021 notice from Rio
Tinto Canada indicates that Rio Tinto Canada will be seeking
approval of a proposed budget for the period from June 2021 to March
2022 of Cdn. $17.8
million. The notice also indicates that Rio Tinto
Canada will be seeking to add to that budget an aggregate of Cdn.
$64.4 million allegedly spent by Rio
Tinto Canada during 2019, 2020 and the first five months of
2021.
Star Diamond disagrees with the
positions taken by Rio Tinto Canada in the June 17, 2021 notice. However, out of
respect for the pending Court decision in relation to the
Undertaking, Star Diamond currently
intends to wait for the release of that decision before responding
to such notice.
Star Diamond continues to vigorously pursue the Legal
Proceedings and is committed to taking all actions necessary to
protect Star Diamond and its
shareholders from the practices and conduct of Rio Tinto Canada.
Star Diamond will provide further
updates in respect of these matters as developments warrant.
About Star Diamond Corporation
Star Diamond Corporation is a Canadian based corporation engaged
in the acquisition, exploration and development of mineral
properties. Shares of Star
Diamond trade on the Toronto Stock Exchange under the
trading symbol "DIAM". Star Diamond's Fort à la
Corne kimberlites (including the Star - Orion South Diamond Project
(the "Project")) are located in central Saskatchewan in close proximity to established
infrastructure, including paved highways and the electrical power
grid, which provide significant advantages for future mine
development. During 2018, Star
Diamond
announced the positive results of an independent Preliminary
Economic Analysis (the
"PEA") on the Project. The PEA estimated that
66 million carats of diamonds could be recovered in a surface mine
over a 38-year Project life, with a Net Present Value ("NPV") (7%)
of $2.0 billion after tax, an
Internal Rate of Return ("IRR") of 19% and an after-tax payback
period of 3.4 years after the commencement of diamond production
(see news release dated April 16,
2018).
All technical information in this press release has
been prepared under the supervision of George Read,
Senior Technical Advisor, a registered
Professional Geoscientist in the Provinces of
Saskatchewan and British Columbia and Mark Shimell, Project Manager, a registered
Professional Geoscientist in the Province of Saskatchewan, who are Star Diamond's "Qualified Persons" under the
definition of NI 43-101.
Caution Regarding Forward-Looking Statements
This news release contains forward-looking statements as defined
by certain securities laws, including the "safe harbour" provisions
of Canadian securities legislation and the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
information is often, but not always, identified by the use of
words such as "anticipate", "believe", "expect", "plan", "intend",
"forecast", "target", "project", "guidance", "may", "will",
"should", "could", "estimate", "predict" or similar words
suggesting future outcomes or language suggesting an outlook. In
particular, statements regarding Star
Diamond's future operations, future exploration and
development activities, other development plans or litigation plans
constitute forward-looking statements. By their nature, statements
referring to mineral reserves, mineral resources, Star Diamond's PEA or the Legal Proceedings
constitute forward-looking statements. Forward-looking statements
contained or implied in this press release include, but are not
limited to, statements regarding the processing and analysis of,
and reporting of results from, the bulk samples previously
collected by Rio Tinto Canada and all timelines; statements related
to diamond breakage and other actions to complete the processing,
diamond recovery and reporting of all diamond results on the
samples previously taken from the ten bulk sample trenches
excavated by Rio Tinto Canada in 2019; statements related to
Star Diamond's intention to enforce
the Undertaking; statements related to the Legal Proceedings;
disclosure regarding the economics and project parameters presented
in the PEA, including, without limitation, IRR, NPV and other costs
and economic information, carats of diamonds to be recovered,
after-tax payback period, tonnes of kimberlite to be mined, carats
per tonne to be recovered (grade), diamond prices, project life,
life of mine, capital costs, and length of pre-production period;
statements related to mineral resources and/or reserves; statements
related to the approval of the development of the Star - Orion
South Diamond Project; statements relating to future development of
the Star - Orion South Diamond Project and associated timelines;
statements with respect to environmental permitting and approvals;
statements with respect to metallurgical investigations,
assessments and test work including Diamond breakage studies; and
the potential proportion of Type IIa diamonds in the Star and Orion
South kimberlites and the potential for the recovery of large high
quality diamonds.
These forward-looking statements are based on Star Diamond's current beliefs as well as
assumptions made by and information currently available to it and
involve inherent risks and uncertainties, both general and
specific. Risks exist that forward-looking statements will not be
achieved due to a number of factors including, but not limited to,
developments in world diamond markets, changes in diamond
valuations, risks relating to fluctuations in the Canadian dollar
and other currencies relative to the US dollar, changes in
exploration, development or mining plans due to exploration results
and changing budget priorities of Rio Tinto Canada or Star Diamond, the effects of competition in the
markets in which Star Diamond operates, risks related to the
Legal Proceedings and legal proceedings to enforce the Undertaking,
risks related to potential dilution of Star
Diamond's interest in the Project, the impact of the
COVID-19 pandemic, risks related to the operation of the on-site
Bulk Sample Plant and the processing methods being used by Rio
Tinto Canada and the effectiveness thereof, risks related to
diamond breakage and cost overruns and other consequences arising
from Rio Tinto Canada's extraction and diamond recovery
methodologies, risks related to Star
Diamond's need for additional financing and Star Diamond's ability to raise that financing,
the impact of changes in the laws and regulations regulating mining
exploration and development, judicial or regulatory judgments and
legal proceedings, operational and infrastructure risks and the
additional risks described in Star
Diamond's most recently filed Annual Information Form,
annual and interim MD&A, news releases and technical
reports. Star Diamond's anticipation of and success in
managing the foregoing risks could cause actual results to differ
materially from what is anticipated in such forward-looking
statements.
Although Star Diamond considers
the assumptions contained in forward-looking statements to be
reasonable based on information currently available to it, those
assumptions may prove to be incorrect. When making decisions
with respect to Star Diamond,
investors and others should not place undue reliance on these
statements and should carefully consider the foregoing factors and
other uncertainties and potential events. Unless required by
applicable securities law, Star
Diamond does not undertake to update any forward-looking
statement that is made herein.
SOURCE Star Diamond Corporation