January 17, 2005

Mano River And Trans Hex Commence Joint Venture On Diamond-Bearing Kimberlite Pipes In Liberia

  • Cluster of diamond-bearing kimberlite pipes, up to 4 hectares in size
  • Trans Hex can earn 50% through US$2.1m investment
  • First known diamond-bearing pipes to be discovered in Liberia

Mano River Resources Inc (Mano) is pleased to announce the commencement of exploration work on its highly prospective cluster of diamond-bearing kimberlite pipes, located in Mano’s 200km² Kpo licence in western Liberia, as per Heads of Agreement signed in June 2002 with Trans Hex Group Limited of South Africa (Trans Hex). Mano’s CEO, Dr Tom Elder, comments: “Mano is very pleased to be able to announce the commencement of exploration under this Joint Venture with Trans Hex. With international support, the security situation in Liberia has improved dramatically of late, enabling this Joint Venture to get under way. We look forward with our highly experienced partner, Trans Hex, to further encouraging news from the exploration programme.” Trans Hex can earn a 50% interest in the Kpo license by investing US$2.1 million in a two phase, three-year programme. Thereafter, Mano can maintain its contributing interest at 50% or offer Trans Hex the opportunity to increase its equity to 69% by funding feasibility and construction. Mano has, to date, discovered five kimberlite pipes in the Weasua area of the Kpo licence. Three of these pipes are confirmed by testwork at Lakefield laboratory in Toronto as diamondiferous and two are estimated to have substantial surface areas of approximately 4 hectares. In addition, numerous high interest, indicator mineral anomalies in the Weasua area remain unresolved, indicating that further pipes may remain to be discovered in the cluster. These anomalies are characterized by excellent garnet and chromite mineral chemistry (see Appendix: Plots 1 and 2). The Weasua area has been mined extensively for diamonds by local artisans since the 1950s. Numerous large, gem quality diamonds are reported to have been recovered from the area over the years, particularly from one drainage downstream of three of the known pipes. The most recently reported average value estimated for Liberian diamond exports was US$160 per carat. Trans Hex intends to commence the exploration programme with ground geophysical surveys over the kimberlite pipes and selected indicator anomalies. The objectives will be to:

  1. Map the surface areas of the pipes in order to define drill targets,
  2. Locate additional kimberlites, and
  3. Establish the optimum geophysical parameters on which to base a detailed airborne geophysical survey throughout the Kpo licence area, scheduled for later in 2005.

Committed funding from Trans Hex for this initial 12 month Phase 1 work, including the airborne geophysical survey, is US$ 454,000.

Prior to Mano’s work, no exploration had previously been undertaken in the area. In the period from 2000 to 2001, Mano rapidly established the presence of this totally new, diamondiferous kimberlite cluster and now, with its Joint Venture partner Trans Hex, intends to locate additional pipes and evaluate in detail those with potential to develop into an economic diamond resource.

About Trans Hex Group

Trans Hex (www.transhex.co.za) has established a global reputation as a niche producer of large, gem-quality diamonds, with annual production exceeding 200,000 carats. Their exploration, mining and marketing activities are principally focused in Southern Africa, through concessions on the Orange River in South Africa, several permits in Angola, as well as offshore the coasts of South Africa and Namibia. The kimberlite Joint Venture with Mano in Liberia indicates the eagerness within Trans Hex to further expand its operations in Africa.

Mano’s Diamond Property Portfolio

In western Liberia, through its Mineral Cooperation Agreement and its Bea Mineral Development Agreement, Mano has an additional 16,000 km² licence area to explore, which it considers to be highly prospective for the discovery of further diamond-bearing kimberlites. Elsewhere, in neighbouring Sierra Leone, the first year’s programme under a joint venture with BHP-Billiton over Mano’s 9,700 km² reconnaissance licence in the east of the country is nearing completion. In December, Mano announced the signing of Heads of Agreement with Crown Diamonds NL for diamond production from one or more of Mano’s kimberlite dyke discoveries in the world-famous Kono diamond district.

About Mano

Mano is an exploration company focused on the discovery of gold and diamond deposits in the Archaean terrain of the highly prospective, under-explored, West African Mano River Union countries of Sierra Leone, Liberia and Guinea. The Company has over 25,000 km² under licence, close to one million ounces of gold in resource, a cluster of diamondiferous kimberlite pipes, and joint ventures in place with Golden Star, BHP Billiton, Trans Hex Group, Navasota and Crown Diamonds which, if they are all fully exercised, will involve a total of over US$16m in third party expenditure. With increasing market recognition of the recent positive evolution in the regional politics, Mano is starting to capitalise on its position as one of the pre-eminent gold and diamond explorers in the sub-region.

On behalf of the Board of Mano River Resources Inc.

Tom Elder
President and CEO

For further information on Mano River Resources and its exploration programme, you are invited to visit the Company’s website at www.manoriver.com or contact one of the following:

Tom Elder
President and CEO
UK +44 (0) 1235 810 740

Raz Hussein
Controller Canada
+1 (604) 689 1700

The TSX Venture Exchange has not reviewed and does not take responsibility for the adequacy or accuracy of this release