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The Project is located approximately 100 km north of Latin American's Paso Yobai Gold Project, covers approximately 165,000 hectares (1,650 square kilometres). The majority 160,000 hectares are 100% owned by Latin American Minerals. On the remaining 5,000 hectares, Latin American has an option to earn a 70% interest by making escalating cash payments totalling $1.5 million over 4 years and, subject to standard dilution provisions, Latin American can earn up to a 100% interest with the vendor retaining a 3% gross sales royalty. .
Geology of the Region is composed of Jurassic sandstones intruded by the Alto Paranaiba Igneous Province that extends from Brazil into Paraguay (see map of Mafic Complexes attached to this press release). The APIP is one of the largest ultramafic potassic igneous provinces in the world. In Brazil, these rocks generated the source of diamonds in the Alto Paranaiba and Ipora region, which are being explored and developed by a number of companies.
The Capiibary region is poorly explored, notwithstanding its close proximity to the significant diamond potential of southern Brazil. In the 1960's, local prospectors claimed to have found a large high quality alluvial diamond in the Capiibary area. In the early 1990's Rex Mining investigated these rumors and carried out a regional stream sediment sampling program. The program was directed by LAT's Country Manager for Paraguay and the sampling technique at that time dictated that the stream sediment was screened, retaining the 0.3-0.425mm fraction, which was examined for micro-diamonds. Rex Diamonds did not find any micro-diamonds and walked away. In 1995, De Beers collected 4 alluvial samples and found eight (8) macro- diamonds in the coarse fraction (0.71-1.00mm) from one of the samples. De Beers report recommends further sampling in the area; however this work was never carried out.
Based on the De Beers report filed in the Paraguay Ministery of Mines, LAT carried out a reconnaissance stream sediment sampling program, collecting 13 samples in the general area of the De Beers sampling and analyzed the coarse fraction. Macro-diamonds where found in 4 samples. Kimberlite indicator minerals (KIMs) where found in the 13 samples which include chrome spinels and garnets. The diamonds are champagne to brilliant white, slightly abraded and several exhibit exceptional crystal structures suggesting minimal alluvial transport. Microprobe work has been completed on the chrome spinels and they were found to fall within the kimberlite stability field. Microprobe work on the garnets is being scheduled.
 The samples collected by LAT containing the diamonds were taken from two small streams within 3 km of the headwaters, defining the small drainage basin covering approximately 25 square km. The source area for the streams covers a north-westerly trending area measuring 12 km long and 1.5 km wide and defines the south-western limit of the drainage basin. Locally, this north-westerly trend defines a regionally structural corridor which is known to contain mafic intrusive complexes and linear magnetic features identified by regional airborne magnetics
Subsequently, LAT secured a 1,650 square kilometre land position in the Capiibary area and regional and detailed stream sediment sampling is continuing and a ground magnetometer survey will commence shortly to cover the 18 square kilometre area defining the south-western limits of the Capiibary drainage basin, which management believes to be the source area for the diamonds.
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