June 03, 2002

[Franko10 ™]

The company announces that it has acquired an almost new diamond X-Ray Sorting plant from Transhex do Brasil. The acquisition of this plant is in addition to the two X Ray Sortex machines currently owned by the company. This well constructed self-contained facility compliments our current activities and, at R$ 105,000 (US$ 41,000) is a fraction of the costs of commissioning, shipping and paying duties on new equipment. This machine will enable the company to more efficiently process the concentrate produced by the moveable plant, currently bulk sampling our Property 108.
The further value of the Sortex equipment is its contribution to security of recovered diamonds, due to the "hands off" nature of the equipment. Security and control of recovered stones is an increasing focus of attention, as our diamond recovery rate accelerates.

The Company also announces that it has successfully completed negotiations to purchase a 60 hectare site on which to permanently locate its secondary concentration and diamond recovery plant, in the Juina Diamond province, Mato Grosso State, Brazil.

This land is optimally located in the center of the cluster of 7 diamondiferous kimberlite pipes, and in the heart of the target areas for alluvial gravels on the 213 and 214 properties. It is serviced by hydro electric power, dirt roads, has it's own water supply and is suitable topographically for the construction of gravity fed material flow, thereby reducing costs significantly.

Beginning immediately we will set up the site infrastructure, and move existing equipment and camp facilities on to the new property.

Diagem is a diamond exploration and mining company with 7 diamondiferous Kimberlites, and three diamond production plants with capacity of 55M3/hour, in Brazil. Through our 40% interest in KWG Resources Inc ("KWG") we have another 7 diamondiferous kimberlites in the James Bay lowlands, and a 51% interest in a joint venture with DeBeers. KWG also has 20 identified diamond occurrences on its property in Wawa, Ontario.

For and on behalf of
DIAGEM International Resource Corp.

"David Cohen"
President