Dia Met Minerals: Ekati Diamond Mine - Initial Production and Exploration Update.

KELOWNA, British Columbia--(BUSINESS WIRE)--Dec. 14, 1998--Dia Met Minerals(TSE:DMM.A.) (AMEX:DMM.A) (TSE:DMM.B.) (AMEX:DMM.B) BHP Diamonds Inc. and Dia Met Minerals Ltd. are pleased to provide the following update on the capital cost, initial production, and recent exploration results for their diamond activities in the NWT.

PRODUCTION

During November 1998, 80,048 carats of diamonds were produced from the Ekati Diamond Mine. October production was 27,839 carats.

Production rates are gradually ramping up as fine tuning progresses in the process plant. Average production for the first two weeks of December has been approximately 5,000 carats per day.

Full production from the Panda Pit, at a rate of approximately 250,000 carats per month, is anticipated by March 1999.

The quality and size distribution of the initial production are consistent with the results of the bulk sampling program. Large diamonds are being recovered, including a 47 carat stone.

Two shipments of rough diamonds have been delivered to the BHP Diamonds sales office in Antwerp, Belgium. Marketing arrangements are progressing and regular sales will begin in January 1999.

Production statistics for the Ekati Diamond Mine will be included in the BHP Production Report, which is issued on a monthly basis.

CAPITAL COST

The final capital cost of the project is expected to be C$699.4 million, approximately C$15 million below the authorized budget. This estimate includes the cost of minor construction work that will continue for the next six to eight months.

EXPLORATION

Valuations of diamond samples taken from the Pigeon Pipe during the summer of 1998 drilling program have been received. These valuations were conducted in Antwerp by a number of diamond dealers, valuers and consultants. The average values are shown in the following table:

Pigeon Pipe               Weights     Value   Carats/Tonne
                           (cts.)   (US$/ct.)

Crater (upper zone)        113.89      $71         .53
Hypabyssal (lower zone)    137.42      $39         .39
Total (overall)            251.31      $54         .45

As has been standard practice for the joint venture, the values per carat are 10 percent less than the average of the valuations. The Pigeon Pipe is land-based, and has a surface area of approximately two hectares. It is located approximately 5 km north of the Ekati mine process plant. The average depth to the upper zone / lower zone contact is approximately 120 m.

Microdiamond analyses have been carried out on kimberlite pipes discovered in the 1998 summer exploration program. Three of seven kimberlites drill confirmed in 1998 have produced significant microdiamond results. Pipe 98-A lies within the Buffer Zone and Pipes 98-B and 98-C are within the Core Zone claims. The results were obtained for analyses of split NQ drill core samples submitted to an independent laboratory. The data are summarized below:

Pipe  Drill Interval Interval Sample   No.     No.  Total wt.
      Hole                           Stones  Stones
Code  Number From      To      Kg     less   greater  carats
             (m)      (m)             than    than
                                     0.5 mm   0.5 mm

98-A  98-6   263.0    308.4  194.9     11        8     0.112
98-B  98-7   248.6    294.7   73.3     12       11     0.057
98-C  98-13  239.5    341.8  155.7     95       61     0.226
      98-14  213.7    331.3   83.8     63       34     0.112

Work continues on the feasibility of incorporating the Koala North and Beartooth pipes in the mining plan. A further exploration program will be undertaken during the upcoming winter months, including bulk samples of the Gazelle pipe, which was discovered in 1995 and is located in the Buffer Zone and the Phoenix pipe, located in the Core Zone (Pipe code 98-C in the above table).

Dia Met is a publicly traded mineral exploration and development company with a primary focus on diamonds. The company holds a 29 per cent interest in the Ekati Diamond Mine, Canada's first commercial diamond mine, together with BHP Diamonds (51 per cent), Charles Fipke, (10 per cent) and Stewart Blusson (10 per cent). The Ekati Diamond Mine is located 300 km northeast of Yellowknife in Canada's Northwest Territories.

James R. Rothwell, President, BHP Diamonds Inc.

Charles E. Fipke, Geologist and Director, Dia Met Minerals Ltd.

James E. Eccott, President Dia Met Minerals Ltd.

The American Stock Exchange and Toronto Stock Exchange have neither approved nor disapproved the information contained in this release.