DIAMOND EXPLORATION: Archangel drops Russian acquisition

TORONTO — Archangel Diamond Corp. has terminated its share purchase agreement for a 49.99% interest in Arkhangelskoe Geologodobychnoe Predpriyatie (AGD) from Russia's OAO Lukoil. The global economic downturn and the failure of the Russian government to give certain approvals by the end of 2008 were cited as the reasons for termination.

Archangel is 65% owned by Cencan S.A., a subsidiary of De Beers. Of particular interest is AGD's Verkhotina licence area, particularly the Grib kimberlite pipe. It has an indicated resource of 50.2 million ct at US$105/ct and an inferred resource of 24.3 million ct at US$119/ct. Archangel has an interest dating back to 1999 in the Grib pipe.

In December 2008, De Beers told CMJ that it had personnel in Russia evaluating the potential to develop a new diamond mine.