| ||Tue May 17, 2005|
Diamond Fields to resume diamond production and arranges financing
| ||NOT FOR DISTRIBUTION TO UNITED STATES WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES|
VANCOUVER, May 17, 2005 - Diamond Fields International Ltd. (TSX:DFI) is pleased to announce the following matters:
1. Refurbishment of DFI's mining vessel mv DF Discoverer is now complete and it is expected that the vessel will depart this week from Cape Town, South Africa to resume mining operations as soon as possible in Mining License 111 offshore Luderitz, Namibia. The vessel was moved to Cape Town for extensive refurbishment to improve its mining and operating efficiencies.
2. In order to provide necessary working capital to launch the mv DF Discoverer, DFI has agreed to carry out a non-brokered private placement of $2 million CDN which will be led by Mr. Jean-Raymond Boulle, the Company's founding and largest shareholder. The private placement will consist of 8 million units at CDN $0.25 per unit with each unit to consist of one common share and one half of a share purchase warrant exercisable for a period of 3 years at CDN $0.40 per share. If the average trading price of DFI's shares is CDN $1.20 or greater during any 20 consecutive trading days after eighteen months from the closing of the private placement, the Company shall have the option of giving notice to the warrant holders that the warrants must be exercised within 20 business days or they will expire. Closing of the private placement is subject to all necessary regulatory acceptances. The Company will have at its option an over subscription right of 25% of the offering ($500,000). The investors in this private placement will consist of both arm's length and non-arm's length investors.
Gregg J. Sedun, President and CEO of Diamond Fields stated: "Resuming diamond production with our own ship mv DF Discoverer is a very significant event in Diamond Fields' history as, for the first time, we will have the ability to control our diamond production and exploration activities and avoid reliance on contractor vessels. This new financing will provide the minimum working capital required to initiate ship operations, while minimizing shareholder dilution at our current stock price."
Diamond Fields International Ltd. is an internationally active exploration and mining company pursuing mineral exploration opportunities worldwide. The Company's corporate strategy is to maximize cash flow from its Namibian marine diamond concessions and systematically explore and develop its international mineral exploration projects. In addition, the Company continues to explore opportunities to acquire new economic mineral projects worldwide.
DIAMOND FIELDS INTERNATIONAL LTD.
"Gregg J. Sedun"
Gregg J. Sedun, President and Chief Executive Officer
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in 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.
For further information: contact Investor Relations at (604) 682-2113, Website: www.diamondfields.com
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