DIATREME RESOURCES LIMITED — Capital/Financing Update 2012

Mar 26, 2012

ASX:DRX

ASX ANNOUNCEMENT

27 March 2012

PROPOSED FARM-IN AGREEMENT WITH ANTOFAGASTA MINERALS S.A. OVER CLERMONT COPPER PROJECT

Diatreme Resources Limited (ASX:”DRX”) is pleased to announce that its 100%-owned subsidiary, Chalcophile Resources Pty. Ltd. has entered into a Memorandum of Understanding with Antofagasta Minerals S.A. (“Antofagasta”) in respect of a proposed farm-in over the Company’s Clermont Copper Project in central Queensland, which hosts the Rosevale Porphyry Corridor (“RPC”).

Discovered by DRX in 2008, the RPC was identified as having potential for large buried porphyry copper - gold - molybdenum mineralised systems. Significant exploration has been conducted by DRX since this time, including geological mapping and sampling, ground geophysics and over 6,000 metres of diamond drilling. This effort was successful in discovering mineralisation at a number of individual prospects within the RPC, and many prospects require further drill testing. The project area extends over two granted tenements (EPM17968, Clermont; and EPM19189, Parapet) and one tenement application (EPMA19544, Expedition Creek) – see location plan, Figure 1 .

Within the Clermont tenements, Antofagasta will specifically target the highly prospective “Rosevale Porphyry Corridor”, a geological zone hosting copper, gold, silver and molybdenum porphyry-style mineralisation, along with adjacent geologically related mineralisation.

Diatreme Resources is an Australian based diversified mineral explorer with significant projects in heavy mineral sands, copper, base metals and gold.

The Company owns the world class Cyclone Zircon Deposit in Western Australia, situated within the recognised Eucla Basin province , along with extensive areas of underexplored ground prospective for heavy mineral sands.

The Board and senior personnel exhibit wide experience, ranging through the exploration and development phases of resource management.

Australian Securities Exchange

Codes: DRX and DRXO

Securities Ordinary shares (DRX): 354,597,423 Listed 15c options (30/09/13)(DRXO): 88,650,039

Board of Directors Executive:

Tony Fawdon - Chairman/CEO David Hall - Operations Non-executive : George White Andrew Tsang William Wang Neil McIntyre

Joint Company Secretaries: Leni Stanley Tuan Do

Key Projects:

• Eucla Basin Cyclone Zircon Project

• Clermont Copper Project

• Anabama Copper Project

Under the agreed terms, Antofagasta will commit US$400,000 over a six month period (nominated as the Initial Assessment Phase) to fund exploration mainly over the RPC, including geological mapping of outcrop, relogging of all DRX’s RPC diamond drill core and reprocessing and assessment of existing data.

Continues overleaf …….

• Gilbert River Base Metals Project

Diatreme Resources Contact: Tony Fawdon Executive Chairman/CEO Phone: +61 7 3832 5666 Fax: +61 7 3832 5300

Share Registry: Link Market Services Level 15, ANZ Building 324 Queen Street, Brisbane, Q4000

DIATREME RESOURCES LIMITED ABN 33 061 267 061 Level 2, 87 Wickham Terrace, Spring Hill, Qld, 4000 PO Box 10288 Brisbane Adelaide Street Qld 4000 Telephone : +61 7 3832 5666 Facsimile : +61 7 3832 5300

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manager@diatreme.com.au www.diatreme.com.au

DIATREME RESOURCES LIMITED

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This Initial Phase of exploration is designed to define subsurface targets for further evaluation through drilling, and to improve upon the geological understanding of the Clermont tenements as a whole, from an exploration and resource perspective.

On completion of the Initial Assessment Phase, to the satisfaction of Antofagasta, Antofagasta has the option of signing a Farm-in Agreement which will contain the following terms:

• Demarcate areas of the tenement deemed prospective for copper mineralisation.

• Antofagasta to earn a 51% interest in the defined area of interest by funding US$8 million in exploration expenditures over a four (4) year period.

• Antofagasta has the right to withdraw from the defined area of interest after spending a minimum of US$1.5 million within the first year, but without earning any equity.

• On earning its 51% interest in the defined area of interest, Antofagasta has the option to earn, at its sole expense, an additional 9% interest (total 60%) by delivering a JORCcompliant inferred resource and completing a scoping study on at least one mineral deposit.

• The vested interests in the defined area of interest of the parties upon completion of a JORC-compliant inferred resource and scoping study would be Antofagasta 60% and DRX 40%.

• Forward expenditure at this stage would be prorata, with industry standard dilution practises being applied.

• Should Antofagasta decide to withdraw from the project after vesting at 51%, DRX will retain management control of the defined area of interest and will dilute Antofagasta’s interest in accordance with industry standard practice.

• If either party dilute to less than a 10% interest, then the diluted party shall relinquish its equity position and revert to a 1.5% net smelter return royalty.

• DRX will be the operator in the Initial Assessment and Farm-in Phases of the project.

• Under certain circumstances, DRX will have the right to reacquire a 100% interest in the defined area of interest by reimbursement to Antofagasta of 150% of all defined area of interest related exploration costs incurred during the farm-in period.

DRX considers the exploration funding and expertise that Antofagasta brings to the Clermont tenements to be of immense value in advancing the identification, delineation and development of a large polymetallic porphyry-style mining operation in the Clermont area.

With Antofagasta recognising the high prospectivity of the Clermont tenements and in particular the Rosevale Porphyry Corridor, DRX believes its’ commitment to enter into a farm-in arrangement has added confidence to realizing the potential of this new Queensland porphyry copper/gold belt.

For further information:For media queries:Tony FawdonAnthony FensomExecutive Chairman/CEOBWHPh: 07 3832 5666Ph: 07 3368 2355	information:on	For media	For media	queries:
			Anthony	Fensom

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DIATREME RESOURCES LIMITED

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Figure 1: Clermont Project Location Plan showing prospects

About Antofagasta Minerals S.A. (“Antofagasta”):

Antofagasta Minerals S.A. is the mining division of Antofagasta plc. Antofagasta plc is listed on the London Stock Exchange and a constituent of the FTSE-100 Index, with interests also in transport and water distribution. Currently, Antofagasta PLC activities are primarily concentrated in Chile where it owns and operates four copper mines: Los Pelambres, Esperanza, El Tesoro and Michilla. Total production in 2011 was 640,500 tonnes of copper, 9,900 tonnes of molybdenum and 196,800 ounces of gold. Antofagasta plc also has exploration, evaluation and/or feasibility programs in North America, Latin America, Europe, Asia, Australia and Africa.

About Diatreme Resources

Diatreme Resources Limited (ASX code: DRX) is a diversified Australian mineral explorer with significant projects in heavy mineral sands, copper, base metals and gold. The Company owns the world-class Cyclone Zircon Deposit in Western Australia, situated within the recognised Eucla Basin province, along with extensive areas of ground prospective for heavy mineral sands, copper, base metals and gold.

The Board and senior personnel exhibit wide experience, ranging through the exploration and development phases of resource management.

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