• The Company has the right to earn an undivided 51% interest in the property by issuing a total of 200,000 common shares, comprised of 100,000 common shares on March 16, 2005, and issuing 100,000 common shares within 12 months (a total of 200,000 common shares issued). Exploration costs of not less than US$500,000 must be incurred on the properties by March 16, 2006.

• An additional 19% undivided interest may be acquired by the issuance of an additional 300,000 common shares by March 16, 2007, and completing an additional US$300,000 in exploration expenditures by March 16, 2007. Upon acquisition of its interest, a joint venture will be formed between the parties and each party will contribute to further expenditures on the property in accordance with its interest.

Casierra has been working in Sierra Leone since 1993 and obtained its first prospecting licence on the Sewa River, which drains the Kono diamond area. Kono is an important centre of diamond production in Sierra Leone with a high percentage of gem quality diamonds coming from kimberlite and alluvial sources. Extensive alluvial diamond exploitation has been carried out upstream of the CDF licence. In late 1994, CDF obtained its second offshore special Exclusive Prospecting Licence at the mouth of two rivers with extensive alluvial diamond mining activity, the Moa and the Mano.

A Technical Report on the Casierra alluvial diamond properties EXPL 1/94 (Hima prospecting licence area) and EXPL 8/05 in Sierra Leone, West Africa was written by Mr. Charles K. Ikona, P.Eng., Pamicon Developments Ltd. of Vancouver, Canada, who was requested to examine the licenses and prepare a report in accordance with National Instrument 43-101.

Mr. Ikona visited EXPL 1/94 and EXPL 8/05 from March 18 to 28, 2005, and also held discussions with government representatives. EXPL 1/94 covers approximately 10.5 km of the Sewa River channel along with adjoining flats and terraces up to 1.4 km wide. The Sewa River has a long history of diamond production from alluvial sources with EXPL 1/94 containing one of the last portions of the diamondiferous sections of the river which has not seen extensive hand mining by natives (Hall, 1966). Within the licence, the river has a relatively low gradient, but is surrounded both upstream and downstream by sections of the river with much steeper, rapid forming gradients.

In a report written for the Geological Survey of Sierra Leone "The Diamond Fields of Sierra Leone" (P.K. Hall, ARSM, BSc, AMIMM), Hall (1966) reports production from 1950 to 1965 on the section of the river above EXPL 1/94, as 42,000 cubic yards with an average recovered grade of 0.75 carats per yard. He further reports 64,000 cubic yards production at similar grade for the same period from the section downstream from the licence and suggests substantial reserves remain in these areas.

Based on extensive study of the Sewa River placers and very minor sampling, Hall presents an estimate for the section of the river contained within EXPL 1/94. He suggests 2,900,000 cubic yards at 0.4 carats per yard for the channel gravels and 1,500,000 cubic yards at 0.4 carats per yard for the flats and low terraces.

In his Technical Report, Mr. Ikona discusses historical reserve estimates, and notes "These are historical reserves only and do not conform to guidelines for resources and reserves according to NI 43-101, nor should it be assumed that any such resource or reserves will be developed on the licence." He notes, however, there seems to be little doubt that diamondiferous gravels are present on the licence and accordingly recommends a two-phase exploration and development program. Mr. Ikona reports that "Sampling to date is very encouraging, but has been on a wide spread basis and not sufficient to allow estimates of potential for the licence. The licence at this time contains no mineral reserves or resources and it cannot be assumed that further work will develop any such reserves or resources."

He reports, however, that results of the programs to date are sufficient to justify further work and recommends a two-phase program. Phase 1 completed in June 2005 was a detailed magnetometer survey over portions of the lease indicated by the 1995 geophysical work as possible pale channels employing an Ovenhauser type horizontal and vertical gradient magnetometer. Cost of the program on both licences is estimated at US$350,000. Phase 2 will be a dredge-sampling program based on the results of phase 1 at an estimated cost of US$710,000. Total cost of the Phase 1 and Phase 2 programs for both licences totals US$1,770,000.

It should be emphasized that no recovery of diamonds is anticipated from the Banka drilling, according to Mr. Ikona. The drills being used have 6-inch diameter drive shoes, which produce a theoretical volume of 0.00670 cubic yards of material per foot of penetration into the gravels. Assuming an average gravel depth of 3 feet, samples should then be about 0.02 cubic yards in volume, which is not great enough to ensure that any values present will be indicated. In fact, should any diamonds be recovered, they must not be used to assign any values to the gravels, as the multiplication factor used in converting from the small sample size to cubic yards would indicate an impossibly high number. Material recovered from drilling will be examined for trace minerals, possibly indicative of alluvial diamonds, and used as a guide for bulk tests.

The magnetometer survey was designed to obtain sufficiently detailed data to plan a bulk-sampling program in the next phase of work necessary to develop this first target of many on the offshore licence. Magnetitic heavy minerals in the younger marine sediments occur as concentrations in the marine sediments that are derived from the diamondiferous gravels transported into the ocean. Partially weathered magnetite grains would be expected to have a density close to that of diamonds (3.55 gms/cc) so this concentration would be expected to include diamonds amongst the heavy minerals.

The three anomalies indicate areas of heavy mineral concentrations over 2 square kilometers each in size. The total area thus identified would have a volume of approximately 8,000,000 cu m per meter of depth, located within a small part of the 88 square kilometer licence. Modeling of the magnetic data will allow estimates of thickness of the heavy mineral rich zones and serve to guide the next phase of sampling.

Cream advanced funds for the first stage of exploration (completed in June 2005) and development of the licences through CDF, with a view to bringing them into production in the short term. All work programs are subject to approvals for mining plans, environmental and socio-economic studies.

Mr. Benjamin Ainsworth, P.Eng., President of Ainsworth Jenkins Consultants Ltd. is the President of both CDF and CDC , and will continue to be the operator on the property.

Maps & Photos

Native Diamond Mining

Casierra Diamond Properties, Sierra Leone - Aggregate production, big rocks to small

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