U.S. Diamond Corp. - Clarification - Hemisphere Investment Report.

VANCOUVER, British Columbia--(BUSINESS WIRE)--Aug. 15, 1996-- The Company wishes to clarify certain statements made on its behalf in the June, 1996 edition of the Hemisphere Investment Report (the "Report").

The Hemisphere Group, author of the Report, and the Company are associated with each other and share offices. The Report cannot, therefore, be considered an independent report. The Report was issued in advance of receipt of regulatory approval. The inclusion in the Report of a statement comparing the diamonds yielded by the Company's George Creek property to diamonds produced from Mountain Province Mining Inc.'s 5034 pipe and the use of stock price data from other diamond exploration companies (Dia Met Minerals Ltd., Aber Resources Ltd., Mountain Province) as a yardstick measurement for the Company's stock price were overly "promotional". In addition, the statement that the George Creek property is potentially the richest in North America is premature and the assessment by the Company of the probability of its own success is unwarranted.

For further clarification of its affairs and as disclosed in previous news releases, the Com {pany has reached agreement to acquire majority interests in two exploration properties: The State Line claims in Colorado, and the Heart Peaks property in northern British Columbia. Over the remainder of the summer of 1996 the Company intends to continue work on both properties.

STATE LINE CLAIMS

Kenneth Shaver, Geologist, Ph.D., in his report to the Company of April, 1996, writes as follows:

"George Creek, Pearl Creek and Sand Creek are diamond prospects in the State Line District of the Colorado-Wyoming kimberlite province. Diamondiferous kimberlite dikes occur on the George Creek and Pearl Creek properties. In the testing performed by The Superior Oil Company and by Lac Minerals, George Creek diamond grade ran as high as 100 carats per hundred tonnes (cpht) and averaged 75 cpht in the 50-tonne test pits. A second phase of testing used a larger cutoff size in order to focus on quickly processing a large volume of material and thus increase the chances of finding more large stones. In all, slightly over 3000 tonnes of kimberlite were processed. Several diamonds greater than 2 carats were recovered, and the largest stone weighed 2.14 carats. Sand Creek contains exploration targets based on kimberlite indicator mineral trains and on geophysical anomalies. Geophysics and stream/soil sample anomalies suggest a potential for making new kimberlite discoveries on all 3 properties."

W. Dan Hausel, Senior Economic Geologist, Wyoming State Geological Survey, wrote in his 1995 article in the Exploration Mining Geology, Volume 4, No. 3, pp. 243-270:

"The George Creek intrusions, southwest of Kelsey Lake, consist of three narrow dikes. These dikes were relatively diamond-rich and yielded more than 86,000 diamonds of grades of 18 to 135 carats/100 tonnes (McCallum and Waldman, 1991)."

These diamonds are currently held at the Geological Department of Colorado State University.

HEART PEAKS PROPERTY

Bruce Evans, the geologist retained by the Operator, Canamera Geological Ltd., to prepare an engineering report on this property provides the following comment:

"The Heart Peaks property is located 145 kilometers southeast of Atlin, British Columbia, within the Atlin Mining Division. The property consists of six (6) contiguous mining claims, and one non- contiguous claim. The seven claims cover a total surface area of 140 units or 3,500 hectares. Previous exploration has defined an area within the Heart Peaks property which contains a very high level of alteration as well as mineralized quartz vein structures within a large epithermal system. A minimum of five individual mineralized zones have been defined within the main epithermal system. Assays of samples collected from the vein structures have returned values as high as 9.9 grams per tonne gold and 1345.0 grams per tonne silver. The silver to gold ratio is extremely high relative to the hypothetical epithermal model."

CURRENT ACTIVITIES

The Company and its operator, MPH Consulting Inc., have formulated a summer work program on its three Colorado/Wyoming state line properties. Currently underway are ground geophysics and stream and soil sampling, which the Company intends to complete by early September, 1996. Once high priority targets are clearly defined the Company will immediately commence drilling and trenching. The Company intends to complete a $1.5 million special warrant financing the proceeds of which will be used in part to finance this initiative.

The Company plans to use the proceeds from its aforementioned financing to conduct a three year work program on the Heart Peaks property. This work program is presently being developed by the Operator of the Property, Canamera Geological Ltd.

The Company regrets any confusion that may have arisen as a result of statements made in the Hemisphere Report.

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

CONTACT: U.S. Diamond Corp.

William D. Friesen, [phone]

1-800-545-7214

[phone] (Fax)