Gem Diamonds Sells DRC Concessions

Gem Diamonds is selling DRC exploration projects, such as the one above

Gem Diamonds is slowly walking away from its holdings in the Democratic Republic of Congo, announcing on Tuesday that it has completed the sale of its shares in two of its three companies in the country. The sale of the third company is expected to be completed in January 2010.

The diamond miner sold the holdings to Kasai Resource Mining Limited (KRM) for $ 3.8 million. The third company will be sold for $ 1.2 million.

Gem Diamonds did not disclose the name of the companies it is selling. It holds about 40 concessions in the Mbelenge, Lubembe and Longatshimo areas in the DRC.

Under the terms of the sale, and in line with its strategy of pursuing kimberlite opportunities, Gem Diamonds maintains a right to an initial 65 percent interest in any economic kimberlite that may be discovered on the concessions currently owned by these DRC companies.

In addition, Gem Diamonds will be entitled to a 3 percent royalty on the revenue from any diamonds extracted from any kimberlite discovery on these concessions.