Diavik Diamond Mines Inc.

Diavik Diamond Mines (DDMI) owns Rio Tinto's interest in and manages the unincorporated Diavik diamonds joint venture in the Northwest Territories of Canada. The project was completed in 2003 well ahead of schedule and under budget. Open pit mining is expected to continue from two orebodies well beyond 2010. Mining takes place in the lake bed at Lac de Gras with water held back by a dike made of rock fill. In 2004 construction of a second dike was approved for mining of the second orebody. Studies are also under way on the feasibility of underground mining to follow the diamond bearing formations at depth. Diavik has won awards for its sensitive management of environmental and community issues.

Diavik reserves are estimated at 95.6 million carats of rough diamonds contained in three ore deposits called kimberlite pipes. The pipes, called A154 South, A154 North, and A418, are small by world average, but are very high grade with some of the world's highest per tonne ore value.

Mining methods will be a combination of open pit and underground.

Annual ore processing is approximately 2.0 million tonnes annually. Production will peak at approximately 8 million carats annually. Diamond production commenced in January 2003 and mine life is estimated at 16-22 years.