DIATREME RESOURCES LIMITED — Capital/Financing Update 2011

Mar 20, 2011

DIATREME RESOURCES LIMITED

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ABN: 33 061 267 061

Postal Address: P.O Box 10288 Brisbane Adelaide Street QLD 4000 Registered Office: Level 2 87 Wickham Terrace Spring Hill QLD 4000 PH: +61 (0)7 3832 5666 FX: +61 (0)7 3832 5300 www.diatreme.com.au manager@diatreme.com.au

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ASX : DRX

Company Announcement Office Australian Stock Exchange Limited Level 4, 20 Bridge Street Sydney NSW 2000

21 March 2011

UNDERWRITING – NON-RENOUNCEABLE RIGHTS ISSUE

On 23 February 2011 Diatreme Resources Ltd (“DRX”) announced a non-renounceable rights issue, fully underwritten by ASX participant, Intersuisse Ltd, but subject to certain termination conditions. During recent global events, the Australian All Ordinaries Index and the S&P ASX Small Resources indices fell to a level giving rise to the right of termination of the underwriting agreement by the Underwriter.

Market conditions have since improved and to-date Intersuisse has advised the Company that it will not exercise its right.

Additionally, DRX’s largest shareholder has reconfirmed its intention to fully subscribe for its Rights Issue entitlement.

Yours sincerely

Diatreme Resources Limited

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Leni Stanley Company Secretary