Archangel Diamond - Purchase of Global Diamonds (SA) Pty Ltd.

VANCOUVER, British Columbia--(BUSINESS WIRE)--June 10, 1996--ARCHANGEL DIAMOND(VSE:AAD) Archangel Diamond Corporation ("AAD") has signed a letter of agreement to acquire Global Diamonds (SA) Pty Ltd. ("Global"), a South African company. Global is a wholly owned subsidiary of Global Diamond Resources Inc. based in San Diego, California. Global has options to purchase a 100 percent interest in two diamond properties and owns a 50 percent interest in a third property, all of which are located in the Republic of South Africa. Global also has in place a highly qualified diamond mining team, led by Mr. Johann de Villiers.

Global owns 50 percent of an alluvial deposit on the inner bank of the Orange River in the Northern Cape Province. Global estimates that the deposit contains approximately 54 million tonnes of diamondiferous gravel.

Global has an option to acquire 100 percent of another alluvial deposit downstream of the confluence of the Vaal and Harts Rivers in the Griqualand West area of the Northern Cape Province. Global estimates the property contains approximately 38 million tonnes of diamondiferous gravel. Global states that the property has been in limited intermittent production since 1989 and has produced approximately 3,600 carats of gem quality diamonds.

Global holds the exclusive prospecting rights and an option to purchase 100 percent of the land encompassing a small diamondiferous kimberlite pipe in the Gauteng Province.

To acquire Global the Company has paid $50,000 and will issue up to 11,000,000 shares; 2,000,000 on closing and up to 9,000,000 shares on the basis of one share for each $2.00 of gross diamond revenues produced by Global. The Company will advance $250,000 to Global for continuing development of its properties which is to be repaid within one year if the transaction is not completed.

The acquisition is subject to completion of due diligence, execution of a definitive agreement by June 21, 1996, shareholder and regulatory approval and financing to be raised by the Company of not less than $5,700,000, all by October 3, 1996.

The Global acquisition establishes a significant presence for AAD in several South African diamond producing areas. The addition of Global's managers and technical experts will strengthen AAD's management team.

The Company's expansion into South Africa complements AAD's recent major success in Russia, where drilling is underway to define the extent of the kimberlite pipe No 441 discovery on the Company's Verkhotina property in Northwest Russia. The Company will provide further information as drilling results become available.

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NOTE TO EDITORS: The Vancouver Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

CONTACT: Archangel Diamond Corporation

Bill Trenaman, 604/687-4452

604/685-9317 (Fax)