Diatreme Resources Limited (ASX code "DRX") is a Brisbane based, highly active and diversified mineral explorer with advanced commodity projects in heavy mineral sands, copper, base metals and gold. The Company has very large exploration ground positions including identified resources, in both heavy mineral sands and copper. At present, the Company's principal focus is on conducting prefeasibility studies over its Cyclone HM Deposit in Western Australia along with exploration over a large porphyry copper/gold mineralised system near Clermont, central Queensland.

MINERAL SANDS

Diatreme's mineral sands exploration focus centres on the highly prospective Eucla Basin, both in Western and South Australia, where a number of exciting heavy mineral sand (zircon) discoveries have been reported since late 2004. Significantly, Diatreme has extensive tenement holdings extending along a main fossil shoreline on the northern basin margin.

The Cyclone Deposit in WA has a JORC classified resource as Measured (11.5Mt at 3.44% HM), Indicated (84.4Mt at 2.82% HM) and Inferred (2.5Mt at 2.38% HM) (refer Table 1).

Table 1: Cyclone Resource Estimate

(ASX announcement 23 September 2009)

Mineralogical testing in the Cyclone Deposit area has confirmed that the heavy mineral suite is rich in highly valued zircon, rutile and leucoxene (refer Table 2).

Table 2: Mineralogy of the Cyclone Deposit

In March 2010, the Company announced positive results from a scoping study completed over the Cyclone Deposit. The study showed the potential for a profitable mine producing about 280,000 tonnes of concentrate annually at a mining rate of 9Mt per annum.

Prefeasibility studies have commmenced, with a goal of commencing project construction in late 2012.

The Company also holds exploration ground for mineral sands in the Arckaringa Basin (SA), Casterton (VIC), Shark Bay (WA) and Cape Bedford (QLD).

COPPER, GOLD & BASE METALS

Diatreme holds exploration tenements for copper/gold at Clermont, Dooloo Creek and Tick Hill in QLD, and Anabama in SA. It also has base metal / gold projects at Bellfield and Ironhurst in QLD.

At Clermont, the Company has conducted deep diamond drilling within the Rosevale Porphyry Corridor in its quest to investigate the potential for the area to host a major mineralised porphyry copper/gold system. Reviews of the structural, geological, alteration and assay data is being undertaken before a second phase drilling program is undertaken.