Dominion Diamond Corporation to Increase Interest in the Ekati Diamond Mine

 Dominion Diamond Corporation to Increase Interest in the Ekati Diamond Mine

  PR Newswire

  YELLOWKNIFE, Northwest Territories, July 9, 2014

YELLOWKNIFE, Northwest Territories, July 9, 2014 /PRNewswire/ --

Dominion Diamond Corporation (TSX:DDC, NYSE:DDC) (the "Company") announced
today that it has entered into an agreement with C. Fipke Holdings Ltd.
("FipkeCo") to acquire FipkeCo's 10% participating interests in the Ekati
Diamond Mine at a price equivalent to the price paid to BHP Billiton in 2013
for its interests.

The Chairman and Chief Executive Officer of Dominion Diamond Corporation,
Robert A. Gannicott, said, "Although the sale by Chuck Fipke of his interest
in the Ekati Project ends his financial involvement with Canada's first
diamond mine, his contribution to its discovery and success goes well beyond
that. The history of Canadian mining is full of stories of accidents of fate
leading to discoveries but the discovery of diamonds in the Slave Geological
Province is a story of years of dedicated technical work led by a focused
technical expert with unwavering belief in the outcome."

The Ekati Mine property consists of the Core Zone, which includes the current
operating mine and other permitted kimberlite pipes, as well as the Buffer
Zone, an adjacent area hosting kimberlite pipes with both development and
exploration potential. The Company currently holds an 80% participating
interest in the Core Zone, with FipkeCo holding a 10% participating interest
and Dr. Stewart Blusson holding the remaining 10% participating interest. The
Company holds a 58.8% participating interest in the Buffer Zone, with FipkeCo
holding a 10% participating interest and Archon Minerals Limited ("Archon")
holding a 31.2% participating interest.

FipkeCo will sell its 10% interest in the Core Zone for US$50 million, subject
to adjustments to reflect joint venture contributions and distributions since
June 30, 2012, as well as interest from that date. The base purchase price
would be payable in instalments over 31 months, and the Company would have the
right, but not the obligation, to satisfy one or more instalments in common
shares of the Company.

FipkeCo will sell its 10% interest in the Buffer Zone for US$17 million,
subject to adjustments to reflect joint venture contributions and
distributions since June 30, 2012, as well as interest from that date. The
purchase price would be payable in cash on closing.

The joint venture agreements governing each of the Core Zone and the Buffer
Zone contain a right of first refusal in favour of each joint venture party,
which rights are exercisable for 60 days. If Dr. Blusson exercises his right
in respect of FipkeCo's Core Zone interest, the Company would acquire an 8.89%
participating interest from FipkeCo, rather than a 10% interest. If Archon
exercises its right in respect of FipkeCo's Buffer Zone interest, the Company
would acquire a 6.53% participating interest from FipkeCo, rather than a 10%
interest.

It is anticipated that completion of the transactions would occur in
September, 2014.

Cautionary Statement on Forward-Looking Information

This news release contains statements that constitute "forward-looking
statements" and/or "forward-looking information" within the meaning of
Canadian and United States securities laws (the "forward-looking information")
relating to the proposed acquisition of the Ekati Diamond Mine. Such
forward-looking information is subject to important risks, uncertainties and
assumptions, including risks relating to the timing of closing of such
acquisition. The results or events predicted in forward-looking information
may differ materially from actual results or events. As a result, readers are
cautioned not to place undue reliance on forward-looking information, which
speaks only as of the date of this disclosure, and should not rely upon this
information as of any other date. While the Company may elect to, it is under
no obligation and does not undertake to, update or revise any forward-looking
information, whether as a result of new information, further events or
otherwise at any particular time, except as required by law. Additional
information concerning factors that may cause actual results to materially
differ from those in such forward-looking statements is contained in the
Company's filings with Canadian and United States securities regulatory
authorities and can be found at  http://www.sedar.com  and
http://www.sec.gov , respectively.

About Dominion Diamond Corporation 

Dominion Diamond Corporation is a Canadian diamond mining company with
ownership interests in two major producing diamond mines. Both mines are
located in the low political risk environment of the Northwest Territories in
Canada. 

The Company operates the Ekati Diamond Mine through its 80% ownership as well
as a 58.8% ownership in the surrounding areas containing additional resources,
and also owns 40% of the Diavik Diamond Mine. It supplies rough diamonds to
the global market through its sorting and selling operations in Canada,
Belgium and India and is the world's third largest producer of rough diamonds
by value. 

For more information, please visit http://www.ddcorp.ca

For further information:

Mr. Richard Chetwode, Vice President, Corporate Development -
+44(0)7720-970-762 or rchetwode@ddcorp.ca

Ms. Kelley Stamm, Manager, Investor Relations -  +1(416)205-4380 or
kstamm@ddcorp.ca
 
Press spacebar to pause and continue. Press esc to stop.