Diadem Resources Ltd. Announces 100% Acquisition of Diamond Rights on the Franklin Project

MONTREAL, Oct. 3, 2011 - Diadem Resources Ltd. (TSX VENTURE:DRL) ("Diadem" or the "Company", "DRL") announced today that it has entered into a Memorandum of Understanding with Darnley Bay Resources Limited ("DBL") to acquire DBL's 50% interest in the Franklin diamond project in the Paulatuk area of the Northwest Territories and DBL's diamond exploration rights on certain crown lands described as the Paulatuk South Lands. Upon completing a definitive agreement between the parties, Diadem will have exclusive rights to all diamonds in the Parry Peninsula and Paulatuk South Lands.

The Project was previously explored in a joint venture between the two companies. DBL will receive 11.7 million treasury shares of the Company and will retain a 2% Net Smelter Royalty ("NSR") on any diamond production from the project properties. Diadem will have the right to purchase 1% of DBL's 2% aggregate NSR for $1.5 million in cash.

Darnley Bay will also retain the rights to purchase back a 50% interest on minerals other than diamonds discovered on the Franklin Diamond project properties by DRL at a price equal to 200% of DRL aggregate investment and expenditure costs related to the discovery of those non-diamond minerals. DBL will retain its back-in rights in all valuable minerals in the Paulatuk South Lands.

This acquisition is subject to the approval of the TSX Venture Exchange and other applicable regulatory authorities and by each of the DRL and DBL boards of directors following completion of a definitive agreement between DRL and DBL.


About Diadem Resources Ltd.

Diadem is focused on acquiring near-production mining opportunities in North America, especially those related to diamonds and gold. Its principal current activity is diamond exploration in the Franklin Bay area of the Northwest Territories. On that project Diadem historically operated a joint venture with its fifty percent (50%) partner Darnley Bay. "The acquisition of DBL's 50 % interest in this project will provide Diadem with full ownership of one of Canada's most exciting diamond exploration projects" stated Aime Bertrand, Diadem's President. "More than twenty new kimberlite drill targets have been identified on the Parry Peninsula area. Additional surveys over another 38 targets are planned. When this work is completed, Diadem will finalize its drilling program for the 2011-12 drilling season."

This transaction is subject to the approval of the TSX Venture Exchange, applicable regulatory authorities and by each of the DRL and DBL boards of directors.

Diadem currently has outstanding 47,508,848 common shares and 72,362,685 on a fully diluted basis.

Additional information about Diadem Resources Ltd. may be found on its web page (www.diademresources.com) and under Diadem's profile on www.sedar.com.


Cautionary Statement

This release includes certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects are forward-looking statements. Although the Company believes the expectations expressed in such statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the statements. There are certain factors that could cause actual results to differ materially from those in forward-looking statements. These include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. In particular, Diadem and DBL may not complete the definitive agreement required to close the transaction or receive the necessary regulatory approvals. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws. For more information on the Company, investors should review registered filings at www.sedar.com.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.



Contact

Diadem Resources Ltd.
Aime Bertrand, Chairman and CEO
514-954-1010
info@diademresources.com
www.diademresources.com