10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10–Q

(Mark One)

xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 31, 2017

or

oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ________________

Commission file number: 000-55233

Diamante Minerals Inc.

(Exact name of registrant as specified in its charter)

Nevada	27-3816969
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

203-1634 Harvey Avenue

Kelowna, British Columbia, Canada V1Y 6G2

(Address of principal executive offices)

250-860-8599

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one).

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller reporting company x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No o

As of March 10, 2017, there were 52,042,286 shares of the issuer’s common stock, par value $0.001, outstanding.

DIAMANTE MINERALS, INC.

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2017

TABLE OF CONTENTS

		PAGE
	PART I - FINANCIAL INFORMATION
Item 1.	Unaudited Financial Statements.	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	22
Item 4.	Controls and Procedures.	23
	PART II - OTHER INFORMATION
Item 1.	Legal Proceedings.	24
Item 1A.	Risk Factors.	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	30
Item 3.	Defaults Upon Senior Securities.	30
Item 4.	Mine Safety Disclosures.	30
Item 5.	Other Information.	30
Item 6.	Exhibits.	30
	SIGNATURES	32

Forward-Looking Statements

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the sections “Business,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You should carefully review the risks and other factors described in our most recent Annual Report on Form 10-K, this quarterly report on Form 10-Q and in other documents we file from time to time with the Securities and Exchange Commission (“SEC”). You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

All references in this Form 10-Q to the “Company”, “Diamante”, “Diamante Minerals”, “we” ,”us” ,or “our” are to Diamante Minerals Inc.

PART I – FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements.

The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules of the Securities and Exchange Commission (“SEC”), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's July 31, 2016 Form 10-K filed with the Securities and Exchange Commission on October 28, 2016. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year ending July 31, 2017.

DIAMANTE MINERALS, INC.

INDEX TO UNAUDITED CONDENSED INTERIM FINANCIAL STATEMENTS

January 31, 2017

	Page
Condensed Balance Sheets	4
Condensed Statements of Operations	5
Condensed Statements of Changes in Stockholders’ Equity	6
Condensed Statements of Cash Flows	7
Notes to Unaudited Condensed Financial Statements	8 – 12

3

DIAMANTE MINERALS, INC.

Condensed Balance Sheets

(Expressed in US Dollars)

	January 31, 2017			July 31, 2016
	(Unaudited)
ASSETS
Current Assets
Cash	$	231,995		$	390,660
Prepaid expenses		-			260
Total Current Assets		231,995			390,920
Mineral Interests (Note 3)		8,022,000			7,992,000
TOTAL ASSETS	$	8,253,995		$	8,382,920
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities	$	14,291		$	60,169
Due to related parties (Note 4 & 5)		570,506			756,997
Total Current Liabilities		584,797			817,166
STOCKHOLDERS' EQUITY
Common Stock, par value $0.001, 300,000,000 shares authorized, 52,042,286 (July 31, 2016 - 52,042,286) shares issued and outstanding (Note 6)		52,042			52,042
Additional paid-in capital (Note 6)		8,954,269			8,954,269
Accumulated deficit		(1,337,113	)		(1,440,557	)
Total Stockholders’ Equity		7,669,198			7,565,754
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	8,253,995		$	8,382,920

The accompanying notes are an integral part of these condensed financial statements.

 

4

DIAMANTE MINERALS, INC.

Condensed Statements of Operations

(Unaudited – Expressed in US Dollars)

	Three months ended						Six months ended
	January 31, 2017			January 31, 2016			January 31, 2017			January 31, 2016
REVENUES	$	-		$	-		$	-		$	-
OPERATING EXPENSES
General and administrative		6,731			9,123			11,744			17,779
Management fees (recovery)		174,478			50,659			(186,492	)		172,164
Professional fees		40,104			13,943			71,304			44,681
TOTAL OPERATING EXPENSES		221,313			73,725			(103,444	)		234,624
INCOME (LOSS) FROM OPERATIONS		(221,313	)		(73,725	)		103,444			(234,624	)
OTHER INCOME AND LOSS
Interest income		-			-			-			-
TOTAL OTHER INCOME AND LOSS		-			-			-			-
INCOME (LOSS) BEFORE INCOME TAXES		(221,313	)		(73,725	)		103,444			(234,624	)
Provision for income taxes		-			-			-			-
NET INCOME (LOSS)	$	(221,313	)	$	(73,725	)	$	103,444		$	(234,624	)
Basic and Diluted Income (Loss) per Common Share	$	(0.00	)	$	(0.00	)	$	0.00		$	(0.00	)
Basic and Diluted Weighted Average Common Shares Outstanding		52,042,286			52,042,286			52,042,286			52,042,286

The accompanying notes are an integral part of these condensed financial statements.

5

DIAMANTE MINERALS, INC.

Condensed Statements of Changes in Stockholders’ Equity

(Unaudited – Expressed in US Dollars)

 

	Number of Common Shares		Common Stock		Additional Paid-in Capital		Accumulated Deficit			Total Stockholders' Equity
Balance at July 31, 2016		52,042,286	$	52,042	$	8,954,269	$	(1,440,557	)	$	7,565,754
Loss for the period		-		-		-		103,444			103,444
Balance at January 31, 2017		52,042,286	$	52,042	$	8,954,269	$	(1,337,113	)	$	7,669,198

The accompanying notes are an integral part of these condensed financial statements.

6

DIAMANTE MINERALS, INC.

Condensed Statements of Cash Flows

(Unaudited – Expressed in US Dollars)

	Six months ended
	January 31, 2017			January 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Income (loss)	$	103,444		$	(234,624	)
Adjustments to reconcile net income (loss) to
net cash used by operating activities:
Management fees (recovery)		(186,491	)		172,163
Changes in operating assets and liabilities:
Decrease in prepaid expense		260			-
Increase (decrease) in accounts payable and accrued liabilities		(45,878	)		(6,222	)
Net cash used in operating activities		(128,665	)		(68,683	)
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided by financing activities		-			-
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Mineracao Batovi Ltda. interest		(30,000	)		-
Funds loaned to Panama project		-			(150,000	)
Net cash used in investing activities		(30,000	)		(150,000	)
Net change in cash		(158,665	)		(218,683	)
Cash - beginning of period		390,660			734,386
Cash - end of period	$	231,995		$	515,703
There were no financing non-cash transactions during the periods ended January 31, 2017 and 2016.
Supplemental Cash Flow Disclosure:
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

The accompanying notes are an integral part of these condensed financial statements.

7

DIAMANTE MINERALS, INC.

Notes to Unaudited Condensed Financial Statements

January 31, 2017

(Expressed in US Dollars)

NOTE 1 - ORGANIZATION AND BUSINESS OPERATIONS

DIAMANTE MINERALS, INC. (the “Company”) was incorporated under the laws of the State of Nevada, U.S. on October 26, 2010. The Company is in the business of acquiring and exploring mineral properties.

The Company has not generated any revenue to date. For the period from inception on October 26, 2010 to January 31, 2017, the Company has accumulated losses of $1,337,113.

The accompanying condensed financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at January 31, 2017, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in condensed financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's July 31, 2016 audited financial statements. The results of operations for the period ended January 31, 2017 are not necessarily indicative of the operating results for the full year.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Presentation of Interim Information: The financial information at January 31, 2017 and for the six months ended January 31, 2017 and 2016 are unaudited but include all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for a fair presentation of the financial information set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the instructions to Form 10-Q. Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information refer to the Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended July 31, 2016.

Use of Estimates: The preparation of the accompanying financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that directly affect the results of reported assets, liabilities, revenue, and expenses, including the valuation of non-cash transactions. Actual results may differ from these estimates.

NOTE 3 – BATOVI DIAMOND PROJECT

On November 20, 2014, we entered into a formal joint venture agreement (“the Joint Venture”) with Mineracao Batovi Ltda. (“Mineracao Batovi”), a Brazilian mineral exploration and mining company, which contemplates the Company acquiring partial ownership of Mineracao Batovi to develop, finance and operate the Batovi Diamond Project, north of Paranatinga in Mato Grosso, Brazil. This was superseded by an amended and restated joint venture agreement (the “Amended and Restated Joint Venture Agreement”) with Mineracao Batovi and Dr. Charles Fipke, the shareholder of Mineracao Batovi, dated January 25, 2017 which provided for us to have the right to acquire up to a 49% interest in Mineracao Batovi. As per the Amended and Restated Joint Venture Agreement, we will be required to contribute $1,000,000 in cash to Mineracao Batovi on or before June 30, 2017, in order to earn a 17.6% interest in Mineracao Batovi, this is in addition to our existing 2.4% equity interest which was acquired during the quarter ended January 31, 2017 from a former shareholder for $30,000. Mineracao Batovi holds the mineral claims underlying the Batovi Diamond Project. We may earn an additional 29% equity interest in Mineracao Batovi by funding a further $2,000,000 of exploration expenses no later than November 20, 2019. If we only fund a portion of the $1,000,000 or $2,000,000 referred to we will only acquire a pro rata portion of the equity interest available to be acquired.

 

8

As per the originally executed agreement, the Company issued 2,700,000 fully paid and non-assessable common shares valued at $7,992,000 to Kel-Ex Developments Ltd. To complete the acquisition of the 17.6% interest in Mineracao Batovi which this relates to, the Company must make its contribution to Mineracao Batovi for the project.

The Amended and Restated Joint Venture Agreement provides that, during the period from the date we acquire some portion of the initial 17.6% equity interest in Mineracao Batovi until the expiry of the period during which we can earn the additional 29% equity interest in Mineracao Batovi and from then on in circumstances where we hold at least a 40% equity interest in Mineracao Batovi, Mineracao Batovi shall be managed by a board of directors comprised of two (2) representatives from each of our Company and the existing shareholder of Mineracao Batovi. In circumstances where our interest in Mineracao Batovi at the end of the period during which we can earn the additional 29% equity interest is greater than 10% but less than 40%, the board of directors shall thereafter be comprised of three (3) representatives of the existing shareholder of Mineracao Batovi and one (1) of our Company. The board of directors shall be similarly constituted during the period which we can earn the additional 29% equity interest as long as the interest in Mineracao Batovi held by our Company is less than 10%. If at any time following the expiry of the period during which we can earn the additional 29% equity interest our interest in Mineracao Batovi is reduced to 10% or less, our Company shall thereafter not be entitled to any representation on the board of directors of Mineracao Batovi.

Under the Amended and Restated Joint Venture Agreement, upon funding our initial $1,000,000 contribution, our Company would be engaged to act as operator of the joint venture on terms whereby our Company will be entitled to charge a 10% administration fee on all exploration expenditures incurred under $50,000 and 5% on all exploration expenditures incurred over $50,000. Our Company has discretion to subcontract with third parties, including Kel-Ex Development Ltd. (“Kel-Ex”), to enable it to fulfill its role as operator. Kel-Ex is a privately-held British Columbia corporation that is under common control with Mineracao Batovi.

NOTE 4 - RELATED PARTY TRANSACTIONS

Included in accounts payable and accrued liabilities is $2,732 (July 31, 2016 – $6,700) in amounts due to companies with common management and to a company owned by the CEO of the Company.

The Company shares office space with other companies in order to take advantage of cost sharing opportunities and management services. Two of these companies are: Kel-Ex Developments Ltd., a significant shareholder of the Company, which shares the services of the Chief Financial Officer; and Metalex Ventures Ltd., a publicly traded company which shares the services of the CEO and the CFO. During the six month period ended January 31, 2017, the related parties invoiced the Company for the following services and amounts:

9

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Administrative fees (10%)	$	434	$	380	$	595	$	744
Geological consulting fees		-		46		-		46
Shared office and administrative costs		1,925		1,931		4,878		3,141
Shared project expenditures		-		2,929		-		4,531
	$	2,359	$	5,286	$	5,473	$	8,462

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Element 29 Ventures Ltd.	$	42	$	2,177	$	42	$	2,177
Kel-Ex Developments Ltd.		1,656		2,444		3,320		4,940
Metalex Ventures Ltd.		661		665		2,111		1,345
	$	2,359	$	5,286	$	5,473	$	8,462

 As at January 31, 2017, the following balances have been included within accounts payable:

	As at
	January 31, 2017		July 31, 2016
Element 29 Ventures Ltd.	$	43	$	-
Kel-Ex Developments Ltd.		2,525		5,341
Metalex Ventures Ltd.		164		1,359
	$	2,732	$	6,700

As at January 31, 2017, the cumulative $451,971 in management fees earned by the Chief Executive Officer and the $118,535 in management fees earned by the Chief Financial Officer pursuant to the Employment Agreements were included as due to related parties (see Note 5).

NOTE 5 - COMMITMENTS AND CONTINGENCIES

On October 16, 2014, the Company and Chad Ulansky entered into an employment agreement (the “CEO Employment Agreement”), pursuant to which Mr. Ulansky is employed by the Company as its Chief Executive Officer for three years. As compensation for his services, Mr. Ulansky shall receive an annual base salary of $400,000 for the first year of the CEO Employment Agreement, $450,000 for the second year and $500,000 for the third year. The Company shall have the right to pay the salary or any other amounts payable to Mr. Ulansky in shares of deferred stock units of the Company based on the 90-day volume weighted average price (“VWAP”) of the shares of the common stock of the Company at the end of each quarter. As at January 31, 2017, $451,971 (July 31, 2016 – $609,392) has been accrued in due to related parties, which equates to 2,553,508 (July 31, 2016 – 1,324,767) shares if Mr. Ulansky were to leave the Company.

On July 12, 2015, the Company and Jennifer Irons entered into an employment agreement (the “CFO Employment Agreement”, and together with the CEO Employment Agreement, the “Employment Agreements”), pursuant to which Ms. Irons is employed by the Company as its Chief Financial Officer for three years. As compensation for her services, Ms. Irons shall receive an annual base salary of $125,000 for the first year of the CFO Employment Agreement, $137,500 for the second year and $150,000 for the third year. The Company shall have the right to pay the salary or any other amounts payable to Ms. Irons in deferred share units of the Company based on the 90-day WAP of the common shares of the Company at the end of each quarter. As at January 31, 2017, $118,535 (July 31, 2016 – $147,605) has been accrued in due to related parties, which equates to 669,689 shares (July 31, 2016 – 320,880) if Ms. Irons were to leave the Company.

 

10

Each Employment Agreement shall automatically renew on each anniversary of such Employment Agreement for one additional year term unless one party provides the other with notice prior to such anniversary date that such party does not desire to renew the Employment Agreement. The Company may immediately terminate Mr. Ulansky's and Ms. Irons’ employment for cause. If (i) Mr. Ulansky's or Ms. Irons’ employment is terminated by the Company without cause, (ii) Mr. Ulansky or Ms. Irons terminates his or her employment as a result of the Company assigning him or her duties inconsistent with his or her position or the Company fails to pay his or her compensation, or (iii) there is a change in control in the Company, then in either case the Company shall pay Mr. Ulansky or Ms. Irons an amount equal to (a) the product of the number of years and fractional years for the remainder of the term multiplied by (b) 50% of the then current base salary in effect as of the date of termination.

During the six month period ended January 31, 2017 the Company recorded a net recovery of $186,492 in management fee and due to related party; this was the result of a decrease in the value of the share price from the July 31, 2016 year end to the January 31, 2017 quarter end. During the six month period ended January 31, 2017, the Company issued 1,577,544 shares under the Employment Agreements.

The Company’s only other commitments as at January 31, 2017 is for its share of office space, which it shares with four other companies. The Company is committed to minimum future lease payments for office premises through to July, 2018 as follows:

Fiscal year ending July 31, 2017       $ 2,240

Fiscal year ending July 31, 2018          4,001

NOTE 6 - COMMON STOCK

Authorized Stock

The Company has authorized 300,000,000 shares of common stock with a par value of $0.001 per share. Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

Issued and Outstanding Stock

There were 52,042,286 shares of common stock issued and outstanding as at January 31, 2017 and July 31, 2016.

On January 27, 2017, the Company filed a registration statement with the Securities and Exchange Commission (“SEC”) on Form S-1 under the Securities Act of 1933, as amended, to register the offer and sale of up to 10,000,000 common shares of the Company at a price of $0.1695 per share. The Company plans to use the proceeds from this offering to fund the acquisition of the 17.6% equity interest in Mineracao Batovi, provide working capital and expand the business. The registration statement remains under review by the SEC and the offering has not commenced.

11

NOTE 7 – LOAN TO OPERATOR OF MOLEJON GOLD MINE PROJECT

Pursuant to an agreement dated January 22, 2016, we have acquired a limited royalty on the first 2,000 ounces of gold that may be produced per month at Petaquilla Minerals Ltd.’s Molejon Gold Mine located in Donoso District, Colon Province, Republic of Panama. Our royalty right is contingent on our advancing to Blendcore LLC, as borrower and as the operator of certain proposed operations at the Molejon Gold Mine, the final tranche of a loan in the total principal amount of $250,000. The funds are to be advanced in accordance with a budget for the restart of processing of stockpiled ore at the Mine, which has been annexed to the loan agreement dated January 22, 2016 among our Company, Blendcore and Petaquilla Minerals’ subsidiary, Petaquilla Gold, S.A. As of January 31, 2017, our Company had advanced $215,000 to Blendcore under the loan agreement. Subsequent to our advancing the monies to Blendcore progress has been slow in advancing the restart. Separate and apart from the issues arising with respect to the loan to Blendcore, we have engaged a law firm in Panama to pursue the acquisition of the Molejon Gold Mine. Representatives of this firm are in discussions with a committee formed by the Panamanian government to oversee the transfer of interests of the Molejon Gold Mine.

Valuation of Derivative

As the loan agreement with Blendcore contains a royalty component, there is an embedded derivative in its value. Currently, the Company has elected to account for the entire instrument as a derivative at fair value, with changes in fair value presented in earnings. The fair value of the derivative is determined by using a discounted cash flow analysis related to various expected future cash flows to be received based on weighted probabilities due to the uncertainty of the potential royalty streams. This asset is classified as a Level 3 asset within the fair value hierarchy as our valuation estimates utilize significant unobservable inputs, including estimates as to the probability and timing of future gold production. Transaction related fees and costs are expensed as incurred.

The changes in the estimated fair value from the derivative along with cash receipts each reporting period are presented together on the Statement of Operations as a component of revenue under the caption, “Derivative – change in fair value”.

Allowance for Doubtful Account

At present, the gold mine has not been restarted. The Company has engaged the services of a legal firm in Panama to determine appropriate title to the claim and our course of action to receive the funds advanced. As such, an allowance for doubtful accounts equal to the amount of the loan has been recorded in the books for the year ended July 31, 2016; no adjustment has been made and the allowance still stands as of January 31, 2017.

NOTE 8 - GOING CONCERN AND LIQUIDITY CONSIDERATIONS

The accompanying condensed financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. During the period ended January 31, 2017, the Company had income of $103,444, which is the result of a recovery of management costs. As at January 31, 2017, the Company had an accumulated deficit of $1,337,113 and has earned no revenues since inception. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ending July 31, 2017.

The ability of the Company to emerge from the exploration stage is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

12

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion of our financial condition, changes in financial condition and results of operations for the six month periods ended January 31, 2017 and 2016 should be read in conjunction with our unaudited condensed consolidated interim financial statements and related notes for the six month periods ended January 31, 2017 and 2016. The following discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those referenced under the heading “Risk Factors” and included in our annual report on Form 10-K for the year ended July 31, 2016, filed with the Securities and Exchange Commission on October 28, 2016.

Overview of Our Business

Our Company was incorporated under the laws of the State of Nevada, U.S. on October 26, 2010 as Oconn Industries Corp. On March 11, 2014, the Company changed its name to Diamante Minerals, Inc. We are in the process of acquiring and exploring mineral properties for possible development.

On November 20, 2014, the Company entered into a joint venture agreement with Mineracao Batovi for the Batovi Diamond Project; this was superseded by an amended and restated joint venture agreement with Mineracao Batovi and Dr. Charles Fipke as the shareholder of Mineracao Batovi dated January 25, 2017. As per this agreement, we have the right to contribute $1,000,000 in cash to Mineracao Batovi on or before June 30, 2017 in order to acquire a 17.6% equity interest in that company. Mineracao Batovi holds the mineral claims underlying the Batovi Diamond Project. We currently hold a 2.4% interest in Mineracao Batovi, having purchased that interest from a former shareholder for $30,000. We may earn an additional 29% equity interest in Mineracao Batovi by funding a further $2,000,000 of exploration expenses no later than November 20, 2019. If we only fund a portion of the $1,000,000 or $2,000,000 referred to we will acquire a pro rata portion of the equity interest available to be acquire.

Our Company is an exploration stage company; at present, there is no assurance that a commercially viable mineral deposit exists on the properties comprising the Batovi Diamond Project in which we hold the right to earn up to a 49% indirect interest, as described in more detail below. As discussed elsewhere in this quarterly report, pursuant to an agreement dated January 22, 2016, we have acquired a limited royalty on the first 2,000 ounces of gold that may be produced per month at Petaquilla Minerals Ltd.’s Molejon Gold Mine located in Donoso District, Colon Province, Republic of Panama. We currently have no interests in any other mineral resource projects.

Results of Operations

We have generated no revenues since inception and have a net recovery of costs of $103,444 during the six months ended January 31, 2017.

The following table provides selected financial data about our Company for the six months ended January 31, 2017 and the year ended July 31, 2016.

Balance Sheet Date	January 31, 2017		July 31, 2016
Cash	$	231,995	$	390,660
Total Assets	$	8,253,995	$	8,382,920
Total Liabilities	$	584,797	$	817,166
Stockholders’ Equity	$	7,669,198	$	7,565,754

13

Plan of Operation

On January 25, 2017, the Company entered into an amended and restated joint venture agreement (the “Amended and Restated Joint Venture Agreement”) with Mineracao Batovi and Dr. Charles Fipke in his capacity as the shareholder of Mineracao Batovi. The Amended and Restated Joint Venture Agreement supersedes the Joint Venture Agreement between the Company and Mineracao Batovi dated November 20, 2014, as previously amended by our Company's letter agreement dated February 27, 2015, which became effective upon its acceptance by Mineracao Batovi and Kel-Ex Development Ltd. (“Kel-Ex”) on March 9, 2015 (as so amended, the “Joint Venture Agreement”).

The Joint Venture Agreement originally contemplated the establishment of a new joint venture company to be formed in Brazil. As initially reported in the Company’s quarterly report on Form 10-Q for the period ended April 30, 2015 (as filed with the SEC on June 22, 2015), due to certain regulatory requirements in Brazil, the Company and Mineracao Batovi determined that it is preferable to use Mineracao Batovi as the joint venture company since it holds the mineral claims underlying the Batovi Diamond Project. The Amended and Restated Joint Venture Agreement now formally contemplates the Company acquiring an interest in Mineracao Batovi to develop, finance and operate the Batovi Diamond Project.

The Amended and Restated Joint Venture Agreement contemplates that we will acquire a 17.6% equity interest in Mineracao Batovi - which is in addition to our existing 2.4% equity interest - in consideration of a cash contribution to Mineracao Batovi of $1,000,000, but such cash consideration must now be made no later than June 30, 2017. Under the Amended and Restated Joint Venture Agreement if we only contribute a portion of the $1,000,000 by June 30, 2017 we will only acquire a pro rata portion of the 17.6% equity interest in Mineracao Batovi.

We continue to be entitled to earn an additional 29% equity interest in Mineracao Batovi by funding a further $2,000,000 of exploration expenses. We also are entitled to earn a pro rata portion of the additional 29% equity interest if we only fund a portion of the $2,000,000. The Joint Venture Agreement originally provided that our right was contingent on us funding such additional exploration expenses no later than November 20, 2017; that date has been extended to November 20, 2019 under the Amended and Restated Joint Venture Agreement.

The Amended and Restated Joint Venture Agreement now provides that, during the period from the date we acquire some portion of the initial 17.6% equity interest in Mineracao Batovia until the expiry of the period during which we can earn the additional 29% equity interest in Mineracao Batovi and from then on in circumstances where we hold at least a 40% equity interest in Mineracao Batovi, Mineracao Batovi shall be managed by a board of directors comprised of two (2) representatives from each of our Company and the existing shareholder Mineracao Batovi Shareholder. In circumstances where our interest in Mineracao Batovi at the end of the period during which we can earn the additional 29% equity interest is greater than 10% but less than 40%, the board of directors shall thereafter be comprised of three (3) representatives of the existing shareholder of Mineracao Batovi and one (1) of our Company. The board of directors shall be similarly constituted during the period which we can earn the additional 29% equity interest as long as the interest in Mineracao Batovi held by our Company is less than 10%. If at any time following the expiry of the period during which we can earn the additional 29% equity interest our interest in Mineracao Batovi is reduced to 10% or less, our Company shall thereafter not be entitled to any representation on the board of directors of Mineracao Batovi.

Certain specified matters continue to be subject to the approval of at least three of the four members of Mineracao Batovi's board of directors, including the adoption of the project's annual budget and any amendments thereto, the scope and purpose of a feasibility study for the Batovi Project (including the determination that the study is positive), and the decision to mine and commence commercial production.

 

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Until we earn the additional 29% equity interest in Mineracao Batovi or the right to earn such interest ends, and so long as we elect to participate in the joint venture, we will bear 100% of Mineracao Batovi's expenses provided that all such expenses are first approved in writing by our Company's representatives on Mineracao Batovi's board of directors.

Under the Amended and Restated Joint Venture Agreement, upon funding our initial $1,000,000 contribution, our Company would be engaged to act as operator of the Batovi Diamond Project on terms whereby our Company will be entitled to charge a 10% administration fee on all exploration expenditures incurred under $50,000 and 5% on all exploration expenditures incurred over $50,000. Our Company has discretion to subcontract with third parties, including Kel-Ex, to enable it to fulfill its role as operator. Kel-Ex is a privately-held British Columbia corporation that is under common control with Mineracao Batovi.

On January 22, 2016, we entered into a loan agreement (the “Loan Agreement”) with Blendcore LLC, a Delaware corporation (“Blendcore”) and Petaquilla Gold, S.A., a Panama corporation (“Petaquilla Gold”), pursuant to which our Company has agreed to advance a loan in the principal amount of US$250,000 to Blendcore (the “Loan”).

Petaquilla Gold, as the owner of minerals sourced from the Molejon Gold Mine located in Donoso District, Colon Province of Panama (the “Mine”), has engaged Blendcore, as master contractor, to act as operator in connection with the restarting of the processing of stockpiled ore at the Mine. The Loan proceeds are to be applied by Blendcore in that capacity in accordance with a use-of-funds budget (the “Budget”) that has been annexed to the Loan Agreement.  Petaquilla Gold is a party to the Loan Agreement in its capacity as the title holder of the minerals, but is not entitled to receive any advances under the Loan Agreement.

Pursuant to the terms of the Loan Agreement, the Loan is to be advanced in three tranches as follows:

·         US$50,000 was advanced upon execution of the Loan Agreement;

·         US$100,000 was required to be advanced within 2 weeks from the execution of the Loan Agreement, and was in fact advanced on January 27, 2016; and

·         US$100,000 will be advanced as required in accordance with the Budget.

As at January 31, 2017, we have advanced $215,000 to Blendcore LLC.

In exchange for the provision of the Loan, our Company is to receive a royalty of 12.5% on the first 1,000 ounces of gold produced per month for 12 months (the “Royalty Period”). The Royalty Period is to commence once production ramps up to 1,000 ounces per month. For monthly production between 1,001 and 2,000 ounces of gold per month, our Company is to receive a reduced royalty of 5%. In addition to the royalty stream, our Company has a right of first option to provide funding for the expansion and development of the Mine.

Under the terms of the Loan Agreement, the Loan is to be forgiven provided that there is at least 12,000 ounces of gold produced during the Royalty Period. Upon the completion of the Royalty Period, our Company has the option to extend the royalty for a further 12 month period through the provision of a second $250,000 loan on substantially the same terms as the initial Loan. This right shall survive the royalty agreement by a period of one year.

 

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Petaquilla Gold and Blendcore have entered into a Collateral Assignment Agreement dated January 11, 2016 (the “Collateral Assignment Agreement”; a copy of which is annexed to the Loan Agreement), pursuant to which Petaquilla Gold has collaterally assigned to Blendcore such number of ounces of gold from that which is mined at the Mine as shall be necessary to enable Blendcore to satisfy its obligations to our Company under the Loan Agreement. By letter of authorization dated January 18, 2016, Petaquilla Gold has consented to the transfer by Blendcore to our Company of Blendcore’s rights under the Collateral Assignment Agreement.

Subsequent to our advancing the monies to Blendcore progress has been slow in advancing the restart. Separate and apart from the issues arising with respect to the loan to Blendcore, we have engaged a law firm in Panama to pursue the acquisition of the Molejon Gold Mine. Representatives of this firm are in discussions with a committee formed by the Panamanian government to oversee the transfer of interests of the Molejon Gold Mine.

Limited Operating History; Need for Additional Capital

As described above, in order to obtain our initial 17.6% interest in the Batovi Diamond Project, we will need to raise a significant amount of funds. We have no assurance that financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations. Equity financing would result in additional dilution to existing shareholders.

There is no historical financial information about us upon which to base an evaluation of our performance. We are a start-up company and have not generated any revenues. We cannot guarantee success of our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.

We anticipate that we will need $2,400,000 to fund the next 12 months of our operations, including our commitments under the Loan Agreement with Blendcore and Petaquilla Gold. If we are unable to meet our needs for cash from either the money that we raise from future financings, or possible alternative sources, then we may be unable to continue, develop, or expand our operations. We currently do not have sufficient funds to operate our business for the next 12 months.

Liquidity and Capital Resources

Working Capital

	January 31, 2017		July 31, 2016
Current Assets	$	231,995	$	390,920
Current Liabilities		584,797		817,166
Working Capital Deficiency	$	352,802	$	426,246

Cash Flows

	Six Months Ended			Six Months Ended
	January 31, 2017			January 31, 2016
Cash Flows used in Operating Activities	$	(128,665	)	$	(68,683	)
Cash Flows used in Investing Activities		(30,000	)		(150,000	)
Cash Flows provided by Financing Activities		-			-
Net change in Cash During the Period	$	(158,665	)	$	(218,683	)

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As at January 31, 2017, our Company’s cash balance was $231,995 compared to $390,920 as at July 31, 2016. The decrease in cash was primarily due to cash used in operating activities, mainly legal costs associated with the Loan to Blendcore, and with accounting and legal costs associated with the preparation and filing with the Securities and Exchange Commission of a registration statement on Form S-1 under the Securities Act of 1933, as amended.

As at January 31, 2017, our Company had total liabilities of $584,797 compared with total liabilities of $817,166 as at July 31, 2016. The decrease in total liabilities was primarily attributed to a recovery of management fees pursuant to the employment agreements with our Chief Executive Officer and our Chief Financial Officer.

As at January 31, 2017, our Company had working capital deficit of $352,802 compared with working capital deficit of $426,246 as at July 31, 2016. The decrease in working capital deficit was primarily attributed to management fees adjusted during the period.

Cash Flow from Operating Activities

During the six months ended January 31, 2017, our Company used $128,665 in cash from operating activities compared to cash used by operating activities of $68,683 during the six months ended January 31, 2016.

Cash Flow from Investing Activities

During the six months ended January 31, 2017, $30,000 was used for investing activity, to purchase a 2.4% equity interest in Mineracao Batovi. During the six months ended January 31, 2016, the Company used $150,000 in investing activity, which was the advancement of funds to Blendcore.

Cash Flow from Financing Activities

During the six months ended January 31, 2017 and 2016, our Company used $nil cash for financing activities.

For the six months ended January 31, 2017 and 2016

Revenues

Our Company did not generate any revenues during the six months ended January 31, 2017 and 2016.

Total operating expenses

For the six months ended January 31, 2017, total operating expenses were a net recovery of $103,444, which included general and administrative expenses of $11,744, management fee recovery adjustment of $186,492, and professional fees of $71,304.

For the six months ended January 31, 2016, total operating expenses were $234,624, which included general and administrative expenses of $17,779, management fees of $172,164, and professional fees of $44,681.

 

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Loss

For the six months ended January 31, 2017, our Company had income of $103,444, as compared to a loss for the six months ended January 31, 2016 of $234,624. General and administrative costs during these periods have decreased in the current year, due to lower staffing costs. In the current period, our Company recorded a recovery of management fees due to a decline in the fair market value of the stock price; as total accrued management fees are based on this price, there was a decrease in the total amount owing to the CEO and the CFO under their respective employment agreements. In the prior period, management fees were comprised of the amounts issued, with no resulting decrease. Professional fees during these periods have increased due to additional legal costs related to the Blendcore loan, as well as additional legal and accounting costs for the filing of our registration statement on Form S-1 under the Securities Act of 1933, as amended.

Going Concern Consideration

Our Company intends to fund operations through equity financing arrangements, which may be insufficient to fund our capital expenditures, working capital and other cash requirements for the year ending July 31, 2017. Our auditors have issued a going concern opinion on our audited financial statements for the year ended July 31, 2016. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay for our expenses. We may in the future attempt to obtain financing through private offerings of debt or equity. Equity financing would result in additional dilution to existing stockholders. We currently have no agreements or arrangements to obtain funds through bank loans, lines of credit or any other sources. There is no assurance we will ever be successful doing so.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Properties

Our executive offices are located at 203 – 1634 Harvey Ave, Kelowna, BC, Canada, V1Y 6G2. We believe that this office space will be adequate for the foreseeable future.

As described under the heading “Plan of Operation” above, our Company has entered into a definitive Amended and Restated Joint Venture Agreement with Mineracao Batovi pursuant to which we may acquire up to a 49% interest in the Batovi Diamond Project through the acquisition of an equity interest in Mineracao Batovi. This project covers 21 claims held by Mineraco Batovi as federal exploration licenses, covering a total area of approximately 109,688 hectares, as more particularly described in the following table and map:

Township/Area	Claim Number	Recording Date	Expiration Date (mm/dd/yy)	Area (hectares)
Mato Grosso	866.467/2011	05/30/2011	2/9/2019	3,051.04
Mato Grosso	866.468/2011	05/30/2011	2/3/2018	348.13
Mato Grosso	866.469/2011	05/30/2011	5/5/2018	8,414.68
Mato Grosso	866.544/2011	06/22/2011	3/9/2018	1,446.25
Mato Grosso	866.545/2011	06/22/2011	3/9/2018	9,934.17
Mato Grosso	866.560/2011	06/28/2011	3/9/2018	5,026.23
Mato Grosso	866.561/2011	06/28/2011	3/9/2018	9,439.19
Mato Grosso	866.562/2011	06/28/2011	3/9/2018	4,113.14
Mato Grosso	866.563/2011	06/28/2011	3/9/2018	7,112.30
Mato Grosso	866.564/2011	06/28/2011	3/9/2018	3,511.58
Mato Grosso	866.565/2011	06/28/2011	3/9/2018	1,371.85
Mato Grosso	866.566/2011	06/28/2011	3/9/2018	6,861.69
Mato Grosso	866.567/2011	06/28/2011	3/9/2018	3,569.48
Mato Grosso	866.568/2011	06/28/2011	3/9/2018	4,424.19
Mato Grosso	866.569/2011	06/28/2011	3/9/2018	1,311.55
Mato Grosso	866.570/2011	06/28/2011	3/9/2018	5,357.18
Mato Grosso	866.571/2011	06/28/2011	5/5/2018	9,534.95
Mato Grosso	866.572/2011	06/28/2011	2/9/2019	3,322.88
Mato Grosso	866.573/2011	06/29/2011	3/9/2018	7,199.99
Mato Grosso	866.574/2011	06/30/2011	3/9/2018	5,776.71
Mato Grosso	867.453/2010	05/06/2010	2/3/2018	8,560.40
				109,687.58

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We currently hold a 2.4% indirect interest in the Batovi Diamond Project, as the Company acquired 2.4% of Mineracao Batovi during the current period end. Pursuant to the Amended and Restated Joint Venture Agreement, we are required to contribute $1,000,000 in cash to Mineracao Batovi prior to June 30, 2017 in order to acquire the remaining 17.6% of our initial 20% equity interest in that company. As Mineracao Batovi hold the rights to the Batovi Diamond Project, our interest in the Batovi Diamond Project would be limited to our shareholdings in Mineracao Batovi.

 

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The Batovi Diamond Project

The Batovi Diamond Project is located in the State of Mato Grosso, in west-central Brazil, approximately 360 kilometers northeast of Cuiaba, the state capital.

The Batovi Diamond Project is accessible from Cuiaba by main and secondary roads. One would travel east from Cuiaba on paved road BR-070 220 kilometers to Primavera do Leste before heading 140 kilometers north on partially paved road MT-130 to Paranatinga. An all-weather gravel road connects Paranatinga to the project area, which lies 120 kilometers to the north.

In addition, Paranatinga has an airport that is suitable for charter aircraft.

 

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Currently there is no plant or equipment on the project site.

In Brazil, exploration licenses are issued by the Director General of the Departamento Nacional de Produção Mineral (translated as the National Department of Mineral Production and referred to in this quarterly report as the “DNPM”). An exploration license is granted for an initial term of up to three years and can be renewed once if the license holder submits an interim report on the exploration work completed to date which justifies further exploration.

An annual exploration fee must be paid to the DNPM to keep an exploration license in good standing. The exploration fee is assessed at the rate of R$2.02 per hectare for each year during the initial term of the license, and at the rate of R$3.95 per hectare for each year during the renewal term. Mineracao Batovi has provided documentation to us evidencing that its exploration licenses comprising the Batovi Diamond Project are in good standing.

The Batovi Diamond Project represents an opportunity for the potential discovery of primary diamond bearing kimberlite intrusives. Due diligence documents provided by Mineraco Batovi confirm that the general area is host to over 40 known kimberlite intrusives which were discovered by DeBeers and Rio Tinto who explored the area between 1967 to about 1997. Historically, a number of the kimberlites were evaluated as possible sources of large, high quality alluvial diamonds found in the area in small, artisanal alluvial mining operations. Although limited testing of the discovered kimberlites returned a few small stones from some of the kimberlites, they were generally not found to be significantly diamondiferous. This suggests that diamond bearing kimberlites which are the source of the large alluvial diamonds found in the project area have yet to be discovered.

Mineracao Batovi has followed up this historic work with limited exploration activities at a cost of approximately CDN$4.7 million, and has identified possible individual diamond indicator mineral trains on the property.

Since we have not funded the $1,000,000 payment required to be made to Mineracao Batovi in order to acquire our initial 20% equity interest in the Batovi Diamond Project, we are not in a position to assume our duties as the operator as contemplated by the Joint Venture Agreement. However, if we are able to fund such $1,000,000, or an adequate portion of this, we anticipate that a majority of the proceeds will be applied to fund exploration work aimed at defining the potential source kimberlites of the indicator mineral trains.

Typically, geophysical surveys are used to locate potential kimberlites. Geophysical surveys measure the physical properties of the rocks below them. It is hoped that the kimberlites would have contrasting physical properties to the surrounding rocks. The proposed geophysical survey would detect both the conductivity and magnetic signature of the underlying rocks. It is expected that the kimberlites would differ from the surrounding host rocks in terms of these physical properties.

If we earn our initial 20% equity interest in Mineracao Batovi and assume our role as the operator of the project, we anticipate that our first step will be to commission an airborne electromagnetic geophysical survey over certain areas preliminarily identified by Mineracao Batovi as having the potential to host diamond bearing kimberlites. Mobilizing an airborne survey system to the project area could take a couple of months after execution of the survey contract. The airborne survey itself should take less than a month. Thereafter, the survey data will have to be extensively manipulated to allow its use. We anticipate that such analytical manipulation would require one to two months to complete. We estimate that the airborne survey will cost approximately $500,000.

Any priority targets identified by the airborne survey will need to be tested, likely by drilling. The length and scope of any such drill program – and the appropriate drill and associated equipment required - will depend on the nature and number of targets, but we anticipate that it would likely take several months to complete. Until the results of the geophysical survey are complete, it is difficult to ascertain what the cost of this target testing phase will be, but we estimate that the initial round of drilling will likely cost between $300,000 to $500,000.

 

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Any future work would be contingent upon the initial round of testing generating positive results. Should a kimberlite be discovered with potentially economic diamond content, we expect that the next phases of work would be delineation drilling followed by bulk sampling and, if warranted, a feasibility study.

The Batovi Diamond Project is centered on the perennial Batovi River; it is conceivable that this would provide a water source for any future operations. We have not investigated what steps would be required or what arrangements will have to be made to secure water rights.

There is currently no power grid at the project area. If future exploration activities justify development at the project site which will give rise to substantial power requirements, diesel generators will have to be installed, or arrangements will have to be made to fund the extension of the power grid from Paranatinga which is located 120 kilometers to the south of the project area.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Our exposure to market risks includes, but is not necessarily limited to, equity price risk, commodity price risk, foreign currency risk and country risk.

Equity Price Risk

We are subject to market risk related to the market price of our common stock which trades over the counter on the OTCQB. Historically, we have relied upon equity financings from the sale of our common stock to fund our operations. Movements in the price of our common stock have been volatile in the past and may continue to be volatile in the future. As a result, there is risk that we may not be able to complete an equity financing at an acceptable price when required.

Commodity Price Risk

We may in the future be subject to market risk related to the market price of rough diamonds, which are priced per carat, and gold, which is priced per ounce. However, at January 31, 2017, we had only a minor interest in the Batovi Diamond Project (2.4%) , and the Royalty Period on Petaquilla Gold’s Molejon Gold Mine project had not yet begun. Accordingly, fluctuations in the market price of rough diamonds or gold do not currently have a direct impact on our operations.

Foreign Currency Risk

We are subject to market risk related to foreign currency exchange rate fluctuations. Our functional currency is the United States dollar. However, a portion of our business is transacted in the Canadian dollar and, if we acquire an interest in Mineracao Batovi we expect that a significant portion of our business will be transacted in the Brazilian real. To date, foreign exchange currency fluctuations have not had a material impact on our results of operations. We do not use derivative financial instruments for speculative trading purposes, nor do we hedge our foreign currency exposure to manage our foreign currency fluctuation risk.

Country Risk

We are subject to market risk related to our operations in foreign jurisdictions. We are party to an Amended and Restated Joint Venture Agreement with Mineracao Batovi dated January 25, 2017, which contemplates our Company acquiring an interest in Mineracao Batovi to develop, finance and operate the Batovi Diamond Project in Brazil. We have also entered into the Loan Agreement with Blendcore and Petaquilla Gold in relation to the start-up of processing of stockpiled ore at Petaquilla Gold’s Molejon Gold Mine in the Republic of Panama.

 

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Foreign countries expose our Company to risks that may not otherwise be experienced if our operations were domestic. The risks include, but are not limited to, those arising under local laws relating to environmental protection, land use, water use, health and safety, labor, restrictions on production, price controls, currency remittance, and maintenance of mineral tenure and expropriation of property. For example, changes to regulations in Brazil relating to royalties, allowable production, importing and exporting of diamonds and environmental protection, may result in our Company not receiving an adequate return on investment capital.

Although the operating environments in Brazil and Panama are considered more favourably compared to those in certain other developing countries, there are still political risks. These risks include, but are not limited to: terrorism, hostage taking, military repression, expropriation, extreme fluctuations in currency exchange rates, high rates of inflation and labor unrest. Changes in mining or investment policies or shifts in political attitudes in these countries may also adversely affect our Company's business. In addition, there may be greater exposure to a risk of corruption and bribery (including possible prosecution under the federal Corruption of Foreign Public Officials Act). Also, in the event of a dispute arising in foreign operations, our Company may be subject to the exclusive jurisdiction of foreign courts and may be hindered or prevented from enforcing its rights. Furthermore, it is possible that future changes in taxes in any of the countries in which our Company operates will adversely affect our Company's operations and economic returns.

Interest Rate Risk

We have no significant exposure to interest rate fluctuation risk.

Item 4. Controls and Procedures.

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. Our President (who serves as our principal executive officer) and our chief financial officer (our principal financial officer) are responsible for establishing and maintaining disclosure controls and procedures for our Company.

As of the end of the quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our President (our principal executive officer) and Chief Financial Officer (our principal financial officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our President (our principal executive officer and principal financial officer) and our Chief Financial Officer (our principal financial officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report.

Changes in Internal Control over Financial Reporting

The term “internal control over financial reporting” is defined as a process designed by, or under the supervision of, the registrant’s principal executive and principal financial officers, or persons performing similar functions, and effected by the registrant’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

 

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·         pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the registrant;

·         provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the registrant are being made only in accordance with authorizations of management and directors of the registrant; and

·         provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the registrant’s assets that could have a material effect on the financial statements.

As disclosed in our most recent annual report on Form 10-K, our President (our principal executive officer and principal financial officer) assessed the effectiveness of our internal control over financial reporting at July 31, 2016, and determined that, as of July 31, 2016, our internal control over financial reporting was not effective due to the existence of certain material weaknesses disclosed in the annual report.

There have been no changes in our internal controls over financial reporting that occurred during the period ended January 31, 2017, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

We know of no material, existing or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors.

In addition to the information contained in our Form 10-K Annual Report for the fiscal year ended July 31, 2016 and this Form 10-Q Quarterly Report, we have identified the following material risks and uncertainties which reflect our outlook and conditions known to us as of the date of this Quarterly Report. These material risks and uncertainties should be carefully reviewed by our stockholders and any potential investors in evaluating the Company, our business and the market value of our common stock. Furthermore, any one of these material risks and uncertainties has the potential to cause actual results, performance, achievements or events to be materially different from any future results, performance, achievements or events implied, suggested or expressed by any forward-looking statements made by usor by persons acting on our behalf.

There is no assurance that we will be successful in preventing the material adverse effects that any one or more of the following material risks and uncertainties may cause on our business, prospects, financial condition and operating results, which may result in a significant decrease in the market price of our common stock. Furthermore, there is no assurance that these material risks and uncertainties represent a complete list of the material risks and uncertainties facing us. There may be additional risks and uncertainties of a material nature that, as of the date of this Quarterly Report, we are unaware of or that we consider immaterial that may become material in the future, any one or more of which may result in a material adverse effect on us. You could lose all or a significant portion of your investment due to any one of these material risks and uncertainties.

Risks Related to Our Company and Business

 

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Evaluating our future performance may be difficult since we are a shell company with negative cash flow and accumulated deficit to date.

We have entered into an Amended and Restated Joint Venture Agreement dated January 25, 2017 pursuant to which we are required to contribute $1,000,000 in cash on or before June 30, 2017 to Mineracao Batovi Ltda., a Brazilian company which holds the mineral claims underlying the Batovi Diamond Project, in return for a 17.6% equity interest in Mineracao Batovi. We currently hold a 2.4% equity interest. However, we are a shell company (as such term is defined in Rule 405 under the Securities Act of 1933, as amended), and, since our inception on October 26, 2010 through January 31, 2017, we have incurred a net loss of $1,337,113. As a result of our limited financial and operating history, including our negative cash flow and net losses to date, it may be difficult to evaluate our future performance.

There is no assurance that we will be successful in securing financing, and substantial doubt exists as to our ability to continue our operations over the next twelve months.

The continuation of our Company as a going concern is dependent upon our ability to obtain adequate financing. We anticipate that we will need $2,400,000 to fund the next 12 months of our operations. However, given our limited financial and operating history and our status as a shell company, there is no assurance that we will be successful in securing any form of financing. Accordingly, substantial doubt exists as to whether we will be able to continue our operations over the next twelve months.

Even if we are successful in acquiring our initial interest in Mineracao Batovi, our reliance on equity financings is expected to continue, and there is no assurance that such financing will be available when required.

Even if we are successful in acquiring our initial interest in Mineracao Batovi, our reliance on equity financings is expected to continue for the foreseeable future, and the availability of such financing will be dependent on many factors beyond our control including, but not limited to, the market price of diamonds, the volatility in the global financial markets affecting our stock price and the status of the worldwide economy, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets.

Diamond exploration and mining activities are inherently subject to numerous significant risks and uncertainties, and actual results may differ significantly from expectations or anticipated amounts. Furthermore, exploration programs conducted on the Batovi Diamond Project may not result in the establishment of ore bodies that contain commercially recoverable diamonds.

Diamond exploration and mining activities are inherently subject to numerous significant risks and uncertainties, many beyond our control, including, but not limited to: (i) unanticipated ground and water conditions; (ii) unusual or unexpected geological formations; (iii) the occurrence of unusual weather or operating conditions and other force majeure events; (iv) lower than expected ore grades; (v) industrial accidents; (vi) delays in the receipt of or failure to receive necessary government permits; (vii) delays in transportation; (viii) availability of contractors and labor; (ix) government permit restrictions and regulation restrictions; (x) unavailability of materials and equipment; and (xi) the failure of equipment or processes to operate in accordance with specifications or expectations. These risks and uncertainties could result in: delays, reductions or stoppages in exploration or development work and any future mining activities; increased capital and/or extraction costs; damage to, or destruction of, the Batovi Diamond Project, extraction facilities or other properties; personal injuries; environmental damage; monetary losses; and legal claims.

 

25

Success in diamond exploration and gold mining is dependent on many factors, including, without limitation, the experience and capabilities of a company’s management, the availability of geological expertise and the availability of sufficient funds to conduct the exploration program. Even if an exploration program is successful and commercially recoverable diamond- or gold-bearing ore bodies are established, it may take a number of years from the initial phases of drilling and identification of the mineralization until extraction is possible, during which time the economic feasibility of extraction may change such that the diamonds cease to be economically recoverable.

Diamond exploration is frequently non-productive due, for example, to poor exploration results or the inability to establish ore bodies that contain commercially recoverable diamonds, in which case the project may be abandoned and written-off. Furthermore, Mineracao Batovi will not be able to benefit from exploration efforts and recover the expenditures that are incurred on exploration programs if Mineracao Batovi does not establish ore bodies that contain commercially recoverable diamonds and develop the Batovi Diamond Project into profitable mining activities, and there is no assurance that Mineracao Batovi will be successful in doing so.

Whether an ore body contains commercially recoverable diamonds depends on many factors including, without limitation: (i) the particular attributes, including material changes to those attributes, of the ore body such as size, grade, recovery rates and proximity to infrastructure; (ii) the market price of diamonds, which may be volatile; and (iii) government regulations and regulatory requirements including, without limitation, those relating to environmental protection, permitting and land use, taxes, land tenure and transportation.

In regards to the Loan Agreement with Blendcore and Petaquilla Gold, our Company bears the risk that production will not recover sufficient quantities of gold to cover the repayment of the loan, in either the Initial Royalty term or, if needed, the extended Royalty term. The loan has been guaranteed by the title holder of the property, and is secured by a first charge over that portion of stock piled ore on the title holder’s mine site. Should the agreement reach this point, our Company would bear the risks of having to process the stock piled ore including, without limitation (i) the particular attributes, including material changes to those attributes, of the stock pile such as recovery rates and ability to procure infrastructure to process it; ii) the market price of gold, which may be volatile; and (iii) government regulations and regulatory requirements including, without limitation, those relating to environmental protection, taxes, land tenure and transportation.

We do not insure against all of the risks we face in our operations.

In general, where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. We currently maintain insurance against certain risks including general commercial liability claims and certain physical assets used in our operations, subject to exclusions and limitations, however, we do not maintain insurance to cover all of the potential risks and hazards associated with our operations.  We may be subject to liability for environmental, pollution or other hazards associated with our or Mineracao Batovi’s exploration activities, which we may not be insured against, which may exceed the limits of our insurance coverage or which we may elect not to insure against because of high premiums or other reasons. Furthermore, we cannot provide assurance that any insurance coverage we currently have will continue to be available at reasonable premiums or that such insurance will adequately cover any resulting liability.

Mineracao Batovi holds mineral rights in Brazil, a foreign jurisdiction which could be subject to additional risks due to political, taxation, economic and cultural factors.

Our business plan contemplates our acquisition of an initial 20% equity interest in Mineracao Batovi, a company incorporated in Brazil. Operations in foreign jurisdictions outside of the U.S., especially in developing countries, may be subject to additional risks as they may have different political, regulatory, taxation, economic and cultural environments that may adversely affect the value or continued viability of our rights. These additional risks include, but are not limited to: (i) changes in governments or senior government officials; (ii) changes to existing laws or policies on foreign investments, environmental protection, mining and ownership of mineral interests; (iii) renegotiation, cancellation, expropriation and nationalization of existing permits or contracts; (iv) foreign currency controls and fluctuations; and (v) civil disturbances, terrorism and war.

 

26

In the event of a dispute arising from our anticipated future involvement in the Batovi Diamond Project, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of the courts in the United States or Canada. We may also be hindered or prevented from enforcing our rights with respect to a government entity or instrumentality because of the doctrine of sovereign immunity. Any adverse or arbitrary decision of a foreign court may have a material and adverse impact on our business, prospects, financial condition and results of operations.

The title to Mineracao Batovi’s mineral property interests may be challenged.

Although we have undertaken reasonable due diligence to confirm that Mineracao Batovi has taken reasonable measures to ensure proper title to its interests in the Batovi Diamond Project and other assets, there is no guarantee that the title to any of such interests will not be challenged. No assurance can be given that Mineracao will be able to secure the grant or the renewal of existing mineral rights and tenures on terms satisfactory to it, or that governments in the jurisdictions in which it operates will not revoke or significantly alter such rights or tenures or that such rights or tenures will not be challenged or impugned by third parties, including local governments, aboriginal peoples or other claimants. Mineracao Batovi’s mineral properties may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. A successful challenge to the precise area and location of Mineracao Batovi’s claims could result in it being unable to explore or operate on its properties as permitted or being unable to enforce its rights with respect to its properties.

We depend on certain key personnel, and our success will depend on our continued ability to retain and attract such qualified personnel.

Our success is dependent on the efforts, abilities and continued service of certain senior officers and key employees and consultants. A loss of service from any one of these individuals may adversely affect our operations, and we may have difficulty or may not be able to locate and hire a suitable replacement.

Certain directors and officers may be subject to conflicts of interest.

Our sole director and our officers are involved in other business ventures including similar capacities with other private or publicly-traded companies. Such individuals may have significant responsibilities to these other business ventures, including consulting relationships, which may require significant amounts of their available time. Conflicts of interest may include decisions on how much time to devote to our business affairs and what business opportunities should be presented to us.

The laws of the State of Nevada and our Articles of Incorporation may protect our directors and officers from certain types of lawsuits.

The laws of the State of Nevada provide that our sole director and officers will not be liable to the Company or its stockholders for monetary damages for all but certain types of conduct as directors and officers of the Company. Our Bylaws provide for broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. These indemnification provisions may require us to use our limited assets to defend our directors and officers against claims, and may have the effect of preventing stockholders from recovering damages against our directors and officers caused by their negligence, poor judgment or other circumstances.

 

27

Our sole director and our officers are residents outside of the U.S., and it may be difficult for stockholders to enforce within the U.S. any judgments obtained against such director or officers.

Our sole director and our officers are nationals and/or residents of countries other than the U.S., and all or a substantial portion of such persons' assets are located outside of the U.S. As a result, it may be difficult for investors to effect service of process on such director and officers, or enforce within the U.S. any judgments obtained against such director and officers, including judgments predicated upon the civil liability provisions of the securities laws of the U.S. or any state thereof. Consequently, stockholders may be effectively prevented from pursuing remedies against such director and officers under U.S. federal securities laws. In addition, stockholders may not be able to commence an action in a Canadian court predicated upon the civil liability provisions under U.S. federal securities laws.

Our management has determined that our disclosure controls and procedures, and our internal control over financial reporting are not effective. In any event disclosure controls and procedures and internal control over financial reporting, no matter how well designed and operated, are designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness.

Management’s evaluation on the effectiveness of disclosure controls and procedures is designed to ensure that information required for disclosure in our public filings is recorded, processed, summarized and reported on a timely basis to our senior management, as appropriate, to allow timely decisions regarding required disclosure. Management’s report on internal control over financial reporting is designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use and transactions are properly recorded and reported. Our management has concluded that our disclosure controls and procedures, and our internal control over financial reporting, were ineffective as of the end of our fiscal year ended July 31, 2016 and as of the end of the period covered by this quarterly report. In any event, any system of controls, no matter how well designed and operated, is based in part upon certain assumptions designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness. Our failure to maintain effective disclosure controls and procedures may result in our inability to continue meeting our reporting obligations in a timely manner, qualified audit opinions or restatements of our financial reports, any one of which may affect the market price for our common stock and our ability to access the capital markets.

Risks Related to Our Common Stock

Broker-dealers may be discouraged from effecting transactions in our common shares because they are considered a penny stock and are subject to the penny stock rules. This could severely limit the market liquidity of the shares.

Our common stock currently constitutes “penny stock”. Subject to certain exceptions, for the purposes relevant to us, “penny stock” includes any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share. Rules 15g-1 through 15g-9 promulgated under the United States Securities Exchange Act of 1934, as amended, impose sales practice and disclosure requirements on certain brokers-dealers who engage in certain transactions involving a “penny stock.” In particular, a broker-dealer selling penny stock to anyone other than an established customer or “accredited investor” (generally, an individual with net worth in excess of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse), must make a special suitability determination for the purchaser and must receive the purchaser’s written consent to the transaction prior to sale, unless the broker-dealer or the transaction is otherwise exempt. A broker-dealer is also required to disclose commissions payable to the broker-dealer and the registered representative and current quotations for the securities. Finally, a broker-dealer is required to send monthly statements disclosing recent price information with respect to the penny stock held in a customer’s account and information with respect to the limited market in penny stocks.

 

28

The additional sales practice and disclosure requirements imposed upon broker-dealers may discourage broker-dealers from effecting transactions in our shares, which could severely limit the market liquidity of the shares and impede the sale of our shares in the secondary market.

In the event that an investment in our shares is for the purpose of deriving dividend income or in expectation of an increase in market price of our shares from the declaration and payment of dividends, the investment will be compromised because we do not intend to pay dividends.

We have never paid a dividend to our shareholders and we intend to retain our cash for the continued development of our business. Accordingly, we do not intend to pay cash dividends on our common stock in the foreseeable future. As a result, a return on investment will be solely determined by the ability to sell the shares in the secondary market.

Historically, the market price of our common stock has been and may continue to fluctuate significantly.

Our stock is thinly traded and trading in our stock is volatile. In addition, the global markets generally have experienced significant and increased volatility in the past, and have been impacted by the effects of mass sub-prime mortgage defaults and liquidity problems of the asset-backed commercial paper market, resulting in a number of large financial institutions requiring government bailouts or filing for bankruptcy. The effects of these past events and any similar events in the future may continue to or further affect the global markets, which may directly affect the market price of our common stock and our accessibility for additional financing. Although this volatility may be unrelated to specific company performance, it can have an adverse effect on the market price of our shares which, historically, has fluctuated significantly and may continue to do so in the future.

In addition to the volatility associated with general economic trends and market conditions, the market price of our common stock could decline significantly due to the impact of any one or more events, including, but not limited to, the following: (i) our inability to raise the financing required to fund the acquisition of our initial 20% equity interest in Mineracao Batovi; (ii) changes in the global market for diamonds; (iii) failure to meet market expectations on Mineracao Batovi’s exploration activities; (iv) sales of a large number of our shares held by certain stockholders including institutions and insiders; (v) legal claims brought forth against us; and (vi) introduction of technological innovations by competitors or in competing technologies.

A prolonged decline in the market price of our common stock could affect our ability to obtain additional financing which would adversely affect our operations.

Historically, we have relied on equity financing as the primary source of funding. A prolonged decline in the market price of our common stock or a reduction in our accessibility to the global markets may result in our inability to secure the financing required to fund the acquisition of our initial 20% equity interest in Mineracao Batovi, or to seek additional financing, which would have an adverse effect on our operations.

Additional issuances of our common stock may result in significant dilution to our existing shareholders and reduce the market value of their investment.

We are authorized to issue 300,000,000 shares of common stock of which 52,042,286 shares were issued and outstanding as of January 31, 2017. Future issuances for financings, mergers and acquisitions, exercise of stock options and share purchase warrants and for other reasons may result in significant dilution to and be issued at prices substantially below the price paid for our shares held by our existing stockholders. Significant dilution would reduce the proportionate ownership and voting power held by our existing stockholders, and may result in a decrease in the market price of our shares.

 

29

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The Company did not complete any unregistered sales of equity securities during the period covered by this quarterly report on Form 10-Q that have not already been disclosed in a current report filed by the Company with the SEC on Form 8-K.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

We did not purchase any of our shares of common stock during the period covered by this quarterly report on Form 10-Q.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

 

30

Item 6. Exhibits.

The following exhibits are included as part of this report:

Exhibit	Description
3.1	Articles of Incorporation (incorporated by reference to Exhibit 3.1 to the Company's Form S-1 filed with the SEC on November 8, 2012)
3.2	By-Laws (incorporated by reference to Exhibit 3.2 to the Company's Form S-1 filed with the SEC on November 8, 2012)
3.3	Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.3 to the Company's Form 8-K filed with the SEC on June 16, 2014)
10.1	Batovi Letter Agreement, dated February 10, 2014 (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed with the SEC on March 3, 2014)
10.2	Amendment, dated February 25, 2014, to the Batovi Letter Agreement (incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed with the SEC on March 3, 2014)
10.3	Employment Agreement dated October 16, 2014 by and between Diamante Minerals, Inc. and Chad Ulansky (incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed with the SEC on October 20, 2014)
10.4	Option Agreement dated as of October 16, 2014 between Diamante Minerals, Inc. and Robert Faber (incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed with the SEC on October 20, 2014)
10.5	Option Agreement dated as of October 16 Chad Ulansky, 2014 between Diamante Minerals, Inc. and Binyamin Gordon (incorporated by reference to Exhibit 10.2 to the Company's Form 8-K filed with the SEC on October 20, 2014)
10.6	Joint Venture Agreement dated November 20, 2014 between Diamante Minerals, Inc. and Mineracao Batovi Ltda. (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed with the SEC on December 11, 2014)
10.7	Letter agreement dated February 27, 2015 between Diamante Minerals, Inc. and Mineracao Batovi Ltda. (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed with the SEC on March 12, 2015)
10.8	Loan Agreement among Diamante Minerals, Inc., Blendcore LLC, and Petaquilla Gold, S.A., dated January 22, 2016 (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed with the SEC on February 3, 2016)
10.9	Amended and Restated Joint Venture Agreement, dated January 25, 2017, among Diamante Minerals, Inc. and Mineracao Batovi Ltda and Dr. Charles Fipke (incorporated by reference to Exhibit 10.1 to the Company's Form 8-K filed with the SEC on January 26, 2017)
14.1	Code of Ethics (incorporated by reference to Exhibit 14 to the Company's Form 10-K filed with the SEC on October 29, 2013)
31.1	Certification of Principal Executive Officer pursuant to Exchange Act Rule 13(a)-14(a)/15(d)-14(a)
31.2	Certification of Principal Financial Officer pursuant to Exchange Act Rule 13(a)-14(a)/15(d)-14(a)
32.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. section 1350
101.INS	XBRL Instance
101.SCH	XBRL Taxonomy Extension Schema
101.CAL	XBRL Taxonomy Extension Calculations
101.DEF	XBRL Taxonomy Extension Definitions
101.LAB	XBRL Taxonomy Extension Labels
101.PRE	XBRL Taxonomy Extension Presentation

31

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	DIAMANTE MINERALS INC.
	(Registrant)
Dated: March 10, 2017	/s/Chad Ulansky
	Chad Ulansky
	President, Secretary, Treasurer and a director (Principal Executive Officer)

32

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Chad Ulansky, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Diamante Minerals Inc., a Nevada corporation, for the quarter ended January 31, 2017;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 10, 2017	By:	/s/Chad Ulansky
		Chad Ulansky
		President, Chief Executive Officer, Secretary, Treasurer and a director (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Jennifer Irons, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Diamante Minerals Inc., a Nevada corporation, for the quarter ended January 31, 2017;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: March 10, 2017	By:	/s/Jennifer Irons
		Jennifer Irons
		Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Each of the undersigned, Chad Ulansky, President and Chief Executive Officer of Diamante Minerals Inc. (the “Registrant”), and Jennifer Irons, Chief Financial Officer of the Registrant, certifies, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report on Form 10-Q of the Registrant for the quarter ended January 31, 2017 (the “Report”):

(1) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Date: March 10, 2017	By:	/s/Chad Ulansky
		Name: Chad Ulansky
		Title: President, Chief Executive Officer, Secretary, Treasurer and a director (Principal Executive Officer)

By:	/s/Jennifer Irons
	Name: Jennifer Irons
	Title: Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - shares	6 Months Ended
	Jan. 31, 2017	Mar. 10, 2017
Document and Entity Information [Abstract]
Entity Registrant Name	DIAMANTE MINERALS, INC.
Entity Central Index Key	0001556801
Trading Symbol	dimn
Current Fiscal Year End Date	--07-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		52,042,286
Document Type	10-Q
Document Period End Date	Jan. 31, 2017
Amendment Flag	false
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2

XML

Condensed Balance Sheets - USD ($)	Jan. 31, 2017	Jul. 31, 2016
Current Assets
Cash	$ 231,995	$ 390,660
Prepaid expenses		260
Total Current Assets	231,995	390,920
Mineral Interests (Note 3)	8,022,000	7,992,000
TOTAL ASSETS	8,253,995	8,382,920
Current Liabilities
Accounts payable and accrued liabilities	14,291	60,169
Due to related parties (Note 4 & 5)	570,506	756,997
Total Current Liabilities	584,797	817,166
STOCKHOLDERS' EQUITY
Common Stock, par value $0.001, 300,000,000 shares authorized, 52,042,286 (July 31, 2016 - 52,042,286) shares issued and outstanding (Note 6)	52,042	52,042
Additional paid-in capital (Note 6)	8,954,269	8,954,269
Accumulated deficit	(1,337,113)	(1,440,557)
Total Stockholders' Equity	7,669,198	7,565,754
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 8,253,995	$ 8,382,920

XML

Condensed Balance Sheets (Parentheticals) - $ / shares	Jan. 31, 2017	Jul. 31, 2016
Statement Of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	52,042,286	52,042,286
Common stock, shares outstanding	52,042,286	52,042,286

XML

Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jan. 31, 2017	Jan. 31, 2016	Jan. 31, 2017	Jan. 31, 2016
Income Statement [Abstract]
REVENUES
OPERATING EXPENSES
General and administrative	6,731	9,123	11,744	17,779
Management fees (recovery)	174,478	50,659	(186,492)	172,164
Professional fees	40,104	13,943	71,304	44,681
TOTAL OPERATING EXPENSES	221,313	73,725	(103,444)	234,624
INCOME (LOSS) FROM OPERATIONS	(221,313)	(73,725)	103,444	(234,624)
OTHER INCOME AND LOSS
Interest income
TOTAL OTHER INCOME AND LOSS
INCOME (LOSS) BEFORE INCOME TAXES	(221,313)	(73,725)	103,444	(234,624)
Provision for income taxes
NET INCOME (LOSS)	$ (221,313)	$ (73,725)	$ 103,444	$ (234,624)
Basic and Diluted Income (Loss) per Common Share (in dollars per share)	$ (0.00)	$ (0.00)	$ 0.00	$ (0.00)
Basic and Diluted Weighted Average Common Shares Outstanding (in shares)	52,042,286	52,042,286	52,042,286	52,042,286

XML

Condensed Statements of Changes in Stockholders' Equity (Unaudited) - 6 months ended Jan. 31, 2017 - USD ($)	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Balance at Jul. 31, 2016	$ 52,042	$ 8,954,269	$ (1,440,557)	$ 7,565,754
Balance (in shares) at Jul. 31, 2016	52,042,286			52,042,286
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Loss for the period			103,444	$ 103,444
Balance at Jan. 31, 2017	$ 52,042	$ 8,954,269	$ (1,337,113)	$ 7,669,198
Balance (in shares) at Jan. 31, 2017	52,042,286			52,042,286

XML

Condensed Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jan. 31, 2017	Jan. 31, 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Income (loss)	$ 103,444	$ (234,624)
Adjustments to reconcile net income (loss) to net cash used by operating activities:
Management fees (recovery)	(186,491)	172,163
Changes in operating assets and liabilities:
Decrease in prepaid expense	260
Increase (decrease) in accounts payable and accrued liabilities	(45,878)	(6,222)
Net cash used in operating activities	(128,665)	(68,683)
CASH FLOWS FROM FINANCING ACTIVITIES
Net cash provided by financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of Mineracao Batovi Ltda. interest	(30,000)
Funds loaned to Panama project		(150,000)
Net cash used in investing activities	(30,000)	(150,000)
Net change in cash	(158,665)	(218,683)
Cash - beginning of period	390,660	734,386
Cash - end of period	231,995	515,703
Supplemental Cash Flow Disclosure:
Cash paid for interest
Cash paid for income taxes

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ORGANIZATION AND BUSINESS OPERATIONS

6 Months Ended

Jan. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND BUSINESS OPERATIONS

NOTE 1 - ORGANIZATION AND BUSINESS OPERATIONS

DIAMANTE MINERALS, INC. (the “Company”) was incorporated under the laws of the State of Nevada, U.S. on October 26, 2010. The Company is in the business of acquiring and exploring mineral properties.

The Company has not generated any revenue to date. For the period from inception on October 26, 2010 to January 31, 2017, the Company has accumulated losses of $1,337,113.

The accompanying condensed financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at January 31, 2017, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in condensed financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's July 31, 2016 audited financial statements. The results of operations for the period ended January 31, 2017 are not necessarily indicative of the operating results for the full year.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Presentation of Interim Information: The financial information at January 31, 2017 and for the six months ended January 31, 2017 and 2016 are unaudited but include all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for a fair presentation of the financial information set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the instructions to Form 10-Q. Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information refer to the Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended July 31, 2016.

Use of Estimates: The preparation of the accompanying financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that directly affect the results of reported assets, liabilities, revenue, and expenses, including the valuation of non-cash transactions. Actual results may differ from these estimates.

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BATOVI DIAMOND PROJECT

6 Months Ended

Jan. 31, 2017

Equity Method Investments and Joint Ventures [Abstract]

BATOVI DIAMOND PROJECT

NOTE 3 – BATOVI DIAMOND PROJECT

On November 20, 2014, we entered into a formal joint venture agreement (“the Joint Venture”) with Mineracao Batovi Ltda. (“Mineracao Batovi”), a Brazilian mineral exploration and mining company, which contemplates the Company acquiring partial ownership of Mineracao Batovi to develop, finance and operate the Batovi Diamond Project, north of Paranatinga in Mato Grosso, Brazil. This was superseded by an amended and restated joint venture agreement (the “Amended and Restated Joint Venture Agreement”) with Mineracao Batovi and Dr. Charles Fipke, the shareholder of Mineracao Batovi, dated January 25, 2017 which provided for us to have the right to acquire up to a 49% interest in Mineracao Batovi. As per the Amended and Restated Joint Venture Agreement, we will be required to contribute $1,000,000 in cash to Mineracao Batovi on or before June 30, 2017, in order to earn a 17.6% interest in Mineracao Batovi, this is in addition to our existing 2.4% equity interest which was acquired during the quarter ended January 31, 2017 from a former shareholder for $30,000. Mineracao Batovi holds the mineral claims underlying the Batovi Diamond Project. We may earn an additional 29% equity interest in Mineracao Batovi by funding a further $2,000,000 of exploration expenses no later than November 20, 2019. If we only fund a portion of the $1,000,000 or $2,000,000 referred to we will only acquire a pro rata portion of the equity interest available to be acquired.

As per the originally executed agreement, the Company issued 2,700,000 fully paid and non-assessable common shares valued at $7,992,000 to Kel-Ex Developments Ltd. To complete the acquisition of the 17.6% interest in Mineracao Batovi which this relates to, the Company must make its contribution to Mineracao Batovi for the project.

The Amended and Restated Joint Venture Agreement provides that, during the period from the date we acquire some portion of the initial 17.6% equity interest in Mineracao Batovi until the expiry of the period during which we can earn the additional 29% equity interest in Mineracao Batovi and from then on in circumstances where we hold at least a 40% equity interest in Mineracao Batovi, Mineracao Batovi shall be managed by a board of directors comprised of two (2) representatives from each of our Company and the existing shareholder of Mineracao Batovi. In circumstances where our interest in Mineracao Batovi at the end of the period during which we can earn the additional 29% equity interest is greater than 10% but less than 40%, the board of directors shall thereafter be comprised of three (3) representatives of the existing shareholder of Mineracao Batovi and one (1) of our Company. The board of directors shall be similarly constituted during the period which we can earn the additional 29% equity interest as long as the interest in Mineracao Batovi held by our Company is less than 10%. If at any time following the expiry of the period during which we can earn the additional 29% equity interest our interest in Mineracao Batovi is reduced to 10% or less, our Company shall thereafter not be entitled to any representation on the board of directors of Mineracao Batovi.

Under the Amended and Restated Joint Venture Agreement, upon funding our initial $1,000,000 contribution, our Company would be engaged to act as operator of the joint venture on terms whereby our Company will be entitled to charge a 10% administration fee on all exploration expenditures incurred under $50,000 and 5% on all exploration expenditures incurred over $50,000. Our Company has discretion to subcontract with third parties, including Kel-Ex Development Ltd. (“Kel-Ex”), to enable it to fulfill its role as operator. Kel-Ex is a privately-held British Columbia corporation that is under common control with Mineracao Batovi.

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RELATED PARTY TRANSACTIONS

6 Months Ended

Jan. 31, 2017

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 4 - RELATED PARTY TRANSACTIONS

Included in accounts payable and accrued liabilities is $2,732 (July 31, 2016 – $6,700) in amounts due to companies with common management and to a company owned by the CEO of the Company.

The Company shares office space with other companies in order to take advantage of cost sharing opportunities and management services. Two of these companies are: Kel-Ex Developments Ltd., a significant shareholder of the Company, which shares the services of the Chief Financial Officer; and Metalex Ventures Ltd., a publicly traded company which shares the services of the CEO and the CFO. During the six month period ended January 31, 2017, the related parties invoiced the Company for the following services and amounts:

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Administrative fees (10%)	$	434	$	380	$	595	$	744
Geological consulting fees		-		46		-		46
Shared office and administrative costs		1,925		1,931		4,878		3,141
Shared project expenditures		-		2,929		-		4,531
	$	2,359	$	5,286	$	5,473	$	8,462

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Element 29 Ventures Ltd.	$	42	$	2,177	$	42	$	2,177
Kel-Ex Developments Ltd.		1,656		2,444		3,320		4,940
Metalex Ventures Ltd.		661		665		2,111		1,345
	$	2,359	$	5,286	$	5,473	$	8,462

 As at January 31, 2017, the following balances have been included within accounts payable:

	As at
	January 31, 2017		July 31, 2016
Element 29 Ventures Ltd.	$	43	$	-
Kel-Ex Developments Ltd.		2,525		5,341
Metalex Ventures Ltd.		164		1,359
	$	2,732	$	6,700

As at January 31, 2017, the cumulative $451,971 in management fees earned by the Chief Executive Officer and the $118,535 in management fees earned by the Chief Financial Officer pursuant to the Employment Agreements were included as due to related parties (see Note 5).

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jan. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 5 - COMMITMENTS AND CONTINGENCIES

On October 16, 2014, the Company and Chad Ulansky entered into an employment agreement (the “CEO Employment Agreement”), pursuant to which Mr. Ulansky is employed by the Company as its Chief Executive Officer for three years. As compensation for his services, Mr. Ulansky shall receive an annual base salary of $400,000 for the first year of the CEO Employment Agreement, $450,000 for the second year and $500,000 for the third year. The Company shall have the right to pay the salary or any other amounts payable to Mr. Ulansky in shares of deferred stock units of the Company based on the 90-day volume weighted average price (“VWAP”) of the shares of the common stock of the Company at the end of each quarter. As at January 31, 2017, $451,971 (July 31, 2016 – $609,392) has been accrued in due to related parties, which equates to 2,553,508 (July 31, 2016 – 1,324,767) shares if Mr. Ulansky were to leave the Company.

On July 12, 2015, the Company and Jennifer Irons entered into an employment agreement (the “CFO Employment Agreement”, and together with the CEO Employment Agreement, the “Employment Agreements”), pursuant to which Ms. Irons is employed by the Company as its Chief Financial Officer for three years. As compensation for her services, Ms. Irons shall receive an annual base salary of $125,000 for the first year of the CFO Employment Agreement, $137,500 for the second year and $150,000 for the third year. The Company shall have the right to pay the salary or any other amounts payable to Ms. Irons in deferred share units of the Company based on the 90-day WAP of the common shares of the Company at the end of each quarter. As at January 31, 2017, $118,535 (July 31, 2016 – $147,605) has been accrued in due to related parties, which equates to 669,689 shares (July 31, 2016 – 320,880) if Ms. Irons were to leave the Company.

Each Employment Agreement shall automatically renew on each anniversary of such Employment Agreement for one additional year term unless one party provides the other with notice prior to such anniversary date that such party does not desire to renew the Employment Agreement. The Company may immediately terminate Mr. Ulansky's and Ms. Irons’ employment for cause. If (i) Mr. Ulansky's or Ms. Irons’ employment is terminated by the Company without cause, (ii) Mr. Ulansky or Ms. Irons terminates his or her employment as a result of the Company assigning him or her duties inconsistent with his or her position or the Company fails to pay his or her compensation, or (iii) there is a change in control in the Company, then in either case the Company shall pay Mr. Ulansky or Ms. Irons an amount equal to (a) the product of the number of years and fractional years for the remainder of the term multiplied by (b) 50% of the then current base salary in effect as of the date of termination.

During the six month period ended January 31, 2017 the Company recorded a net recovery of $186,492 in management fee and due to related party; this was the result of a decrease in the value of the share price from the July 31, 2016 year end to the January 31, 2017 quarter end. During the six month period ended January 31, 2017, the Company issued 1,577,544 shares under the Employment Agreements.

The Company’s only other commitments as at January 31, 2017 is for its share of office space, which it shares with four other companies. The Company is committed to minimum future lease payments for office premises through to July, 2018 as follows:

Fiscal year ending July 31, 2017       $ 2,240

Fiscal year ending July 31, 2018          4,001

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COMMON STOCK

6 Months Ended

Jan. 31, 2017

Stockholders' Equity Note [Abstract]

COMMON STOCK

NOTE 6 - COMMON STOCK

Authorized Stock

The Company has authorized 300,000,000 shares of common stock with a par value of $0.001 per share. Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

Issued and Outstanding Stock

There were 52,042,286 shares of common stock issued and outstanding as at January 31, 2017 and July 31, 2016.

On January 27, 2017, the Company filed a registration statement with the Securities and Exchange Commission (“SEC”) on Form S-1 under the Securities Act of 1933, as amended, to register the offer and sale of up to 10,000,000 common shares of the Company at a price of $0.1695 per share. The Company plans to use the proceeds from this offering to fund the acquisition of the 17.6% equity interest in Mineracao Batovi, provide working capital and expand the business. The registration statement remains under review by the SEC and the offering has not commenced.

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LOAN TO OPERATOR OF MOLEJON GOLD MINE PROJECT

6 Months Ended

Jan. 31, 2017

Receivables [Abstract]

LOAN TO OPERATOR OF MOLEJON GOLD MINE PROJECT

NOTE 7 – LOAN TO OPERATOR OF MOLEJON GOLD MINE PROJECT

Pursuant to an agreement dated January 22, 2016, we have acquired a limited royalty on the first 2,000 ounces of gold that may be produced per month at Petaquilla Minerals Ltd.’s Molejon Gold Mine located in Donoso District, Colon Province, Republic of Panama. Our royalty right is contingent on our advancing to Blendcore LLC, as borrower and as the operator of certain proposed operations at the Molejon Gold Mine, the final tranche of a loan in the total principal amount of $250,000. The funds are to be advanced in accordance with a budget for the restart of processing of stockpiled ore at the Mine, which has been annexed to the loan agreement dated January 22, 2016 among our Company, Blendcore and Petaquilla Minerals’ subsidiary, Petaquilla Gold, S.A. As of January 31, 2017, our Company had advanced $215,000 to Blendcore under the loan agreement. Subsequent to our advancing the monies to Blendcore progress has been slow in advancing the restart. Separate and apart from the issues arising with respect to the loan to Blendcore, we have engaged a law firm in Panama to pursue the acquisition of the Molejon Gold Mine. Representatives of this firm are in discussions with a committee formed by the Panamanian government to oversee the transfer of interests of the Molejon Gold Mine.

Valuation of Derivative

As the loan agreement with Blendcore contains a royalty component, there is an embedded derivative in its value. Currently, the Company has elected to account for the entire instrument as a derivative at fair value, with changes in fair value presented in earnings. The fair value of the derivative is determined by using a discounted cash flow analysis related to various expected future cash flows to be received based on weighted probabilities due to the uncertainty of the potential royalty streams. This asset is classified as a Level 3 asset within the fair value hierarchy as our valuation estimates utilize significant unobservable inputs, including estimates as to the probability and timing of future gold production. Transaction related fees and costs are expensed as incurred.

The changes in the estimated fair value from the derivative along with cash receipts each reporting period are presented together on the Statement of Operations as a component of revenue under the caption, “Derivative – change in fair value”.

Allowance for Doubtful Account

At present, the gold mine has not been restarted. The Company has engaged the services of a legal firm in Panama to determine appropriate title to the claim and our course of action to receive the funds advanced. As such, an allowance for doubtful accounts equal to the amount of the loan has been recorded in the books for the year ended July 31, 2016; no adjustment has been made and the allowance still stands as of January 31, 2017.

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GOING CONCERN AND LIQUIDITY CONSIDERATIONS

6 Months Ended

Jan. 31, 2017

Going Concern and Liquidity Considerations [Abstract]

GOING CONCERN AND LIQUIDITY CONSIDERATIONS

NOTE 8 - GOING CONCERN AND LIQUIDITY CONSIDERATIONS

The accompanying condensed financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the liquidation of liabilities in the normal course of business. During the period ended January 31, 2017, the Company had income of $103,444, which is the result of a recovery of management costs. As at January 31, 2017, the Company had an accumulated deficit of $1,337,113 and has earned no revenues since inception. The Company intends to fund operations through equity financing arrangements, which may be insufficient to fund its capital expenditures, working capital and other cash requirements for the year ending July 31, 2017.

The ability of the Company to emerge from the exploration stage is dependent upon, among other things, obtaining additional financing to continue operations, and development of its business plan. In response to these problems, management intends to raise additional funds through public or private placement offerings.

These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jan. 31, 2017

Accounting Policies [Abstract]

Presentation of Interim Information

Presentation of Interim Information: The financial information at January 31, 2017 and for the six months ended January 31, 2017 and 2016 are unaudited but include all adjustments (consisting only of normal recurring adjustments) that the Company considers necessary for a fair presentation of the financial information set forth herein, in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the instructions to Form 10-Q. Accordingly, such information does not include all of the information and footnotes required by U.S. GAAP for annual financial statements. For further information refer to the Financial Statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended July 31, 2016.

Use of Estimates

Use of Estimates: The preparation of the accompanying financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that directly affect the results of reported assets, liabilities, revenue, and expenses, including the valuation of non-cash transactions. Actual results may differ from these estimates.

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RELATED PARTY TRANSACTIONS (Tables)

6 Months Ended

Jan. 31, 2017

Related Party Transactions [Abstract]

Schedule of related party transaction

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Administrative fees (10%)	$	434	$	380	$	595	$	744
Geological consulting fees		-		46		-		46
Shared office and administrative costs		1,925		1,931		4,878		3,141
Shared project expenditures		-		2,929		-		4,531
	$	2,359	$	5,286	$	5,473	$	8,462

	Three month period ended				Six month period ended
	January 31,		January 31,		January 31,		January 31,
	2017		2016		2017		2016
Element 29 Ventures Ltd.	$	42	$	2,177	$	42	$	2,177
Kel-Ex Developments Ltd.		1,656		2,444		3,320		4,940
Metalex Ventures Ltd.		661		665		2,111		1,345
	$	2,359	$	5,286	$	5,473	$	8,462

	As at
	January 31, 2017		July 31, 2016
Element 29 Ventures Ltd.	$	43	$	-
Kel-Ex Developments Ltd.		2,525		5,341
Metalex Ventures Ltd.		164		1,359
	$	2,732	$	6,700

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ORGANIZATION AND BUSINESS OPERATIONS (Detail Textuals) - USD ($)	Jan. 31, 2017	Jul. 31, 2016	Oct. 26, 2010
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accumulated losses	$ (1,337,113)	$ (1,440,557)	$ (1,337,113)

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BATOVI DIAMOND PROJECT (Detail Textuals) - USD ($)		1 Months Ended	3 Months Ended
	Feb. 10, 2014	Nov. 20, 2014	Jan. 31, 2017
Joint Venture Agreement | Mineracao Batovi
Schedule of Equity Method Investments [Line Items]
Number of fully-paid and non-assessable common shares issued for assets acquisition		2,700,000
Value of fully-paid and non-assessable common shares issued for assets acquisition		$ 7,992,000
Payment to joint venture in cash for equity interest		$ 1,000,000
Percentage of equity interest earned	75.00%	20.00%
Additional equity interest earned by funding exploration expenses		29.00%
Funding exploration expenses		$ 2,000,000
Interest earned in project rated based description		The Company may earn an additional 29% equity interest in Mineracao Batovi by funding $2,000,000 of exploration expenses no later than November 20, 2017.
Joint Venture Agreement | Kel-Ex Developments Ltd.
Schedule of Equity Method Investments [Line Items]
Number of fully-paid and non-assessable common shares issued for assets acquisition		2,700,000
Value of fully-paid and non-assessable common shares issued for assets acquisition		$ 7,992,000
Amended and Restated Joint Venture Agreement | Mineracao Batovi
Schedule of Equity Method Investments [Line Items]
Payment to joint venture in cash for equity interest		$ 1,000,000	$ 30,000
Percentage of equity interest earned		49.00%	2.40%
Additional equity interest earned by funding exploration expenses		40.00%	17.60%
Amended and Restated Joint Venture Agreement, equity interest description		The Amended and Restated Joint Venture Agreement provides that, during the period from the date we acquire some portion of the initial 17.6% equity interest in Mineracao Batovi until the expiry of the period during which we can earn the additional 29% equity interest in Mineracao Batovi and from then on in circumstances where we hold at least a 40% equity interest in Mineracao Batovi, Mineracao Batovi shall be managed by a board of directors comprised of two (2) representatives from each of our Company and the existing shareholder of Mineracao Batovi. In circumstances where our interest in Mineracao Batovi at the end of the period during which we can earn the additional 29% equity interest is greater than 10% but less than 40%, the board of directors shall thereafter be comprised of three (3) representatives of the existing shareholder of Mineracao Batovi and one (1) of our Company. The board of directors shall be similarly constituted during the period which we can earn the additional 29% equity interest as long as the interest in Mineracao Batovi held by our Company is less than 10%. If at any time following the expiry of the period during which we can earn the additional 29% equity interest our interest in Mineracao Batovi is reduced to 10% or less, our Company shall thereafter not be entitled to any representation on the board of directors of Mineracao Batovi.
Amended and Restated Joint Venture Agreement | Kel-Ex Developments Ltd.
Schedule of Equity Method Investments [Line Items]
Percentage of administration fee on exploration expenditures below 50000		10.00%
Percentage of administration fee on exploration expenditures above 50000		5.00%
Administration fees percentage description		Kel-Ex is entitled to charge a 10% administration fee on all exploration expenditures incurred under $50,000 and 5% on all exploration expenditures incurred over $50,000.

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RELATED PARTY TRANSACTIONS (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jan. 31, 2017	Jan. 31, 2016	Jan. 31, 2017	Jan. 31, 2016
Related Party Transactions [Abstract]
Administrative fees (10%)	$ 434	$ 380	$ 595	$ 744
Geological consulting fees		46		46
Shared office and administrative costs	1,925	1,931	4,878	3,141
Shared project expenditures		2,929		4,531
Total related party expense	$ 2,359	$ 5,286	$ 5,473	$ 8,462

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RELATED PARTY TRANSACTIONS (Details 1) - USD ($)	3 Months Ended		6 Months Ended
	Jan. 31, 2017	Jan. 31, 2016	Jan. 31, 2017	Jan. 31, 2016
Related Party Transaction [Line Items]
Related party expense	$ 2,359	$ 5,286	$ 5,473	$ 8,462
Element 29 Ventures Ltd.
Related Party Transaction [Line Items]
Related party expense	42	2,177	42	2,177
Kel-Ex Developments Ltd.
Related Party Transaction [Line Items]
Related party expense	1,656	2,444	3,320	4,940
Metalex Ventures Ltd.
Related Party Transaction [Line Items]
Related party expense	$ 661	$ 665	$ 2,111	$ 1,345

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RELATED PARTY TRANSACTIONS (Details 2) - USD ($)	Jan. 31, 2017	Jul. 31, 2016
Related Party Transaction [Line Items]
Due to related party	$ 570,506	$ 756,997
Accounts payable and accrued liabilities
Related Party Transaction [Line Items]
Due to related party	2,732	6,700
Element 29 Ventures Ltd. | Accounts payable and accrued liabilities
Related Party Transaction [Line Items]
Due to related party	43
Kel-Ex Developments Ltd. | Accounts payable and accrued liabilities
Related Party Transaction [Line Items]
Due to related party	2,525	5,341
Metalex Ventures Ltd. | Accounts payable and accrued liabilities
Related Party Transaction [Line Items]
Due to related party	$ 164	$ 1,359

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RELATED PARTY TRANSACTIONS (Detail Textuals) - USD ($)	Jan. 31, 2017	Jul. 31, 2016
Related Party Transaction [Line Items]
Percentage of administrative fees	10.00%
Due to related party	$ 570,506	$ 756,997
Accounts payable and accrued liabilities
Related Party Transaction [Line Items]
Due to related party	2,732	6,700
Employment Agreement | Chief Executive Officer
Related Party Transaction [Line Items]
Due to related party	451,971	609,392
Employment Agreement | Chief Financial Officer
Related Party Transaction [Line Items]
Due to related party	$ 118,535	$ 147,605

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COMMITMENTS AND CONTINGENCIES (Detail Textuals) - USD ($)

1 Months Ended

3 Months Ended

6 Months Ended

12 Months Ended

Jul. 12, 2015

Oct. 16, 2014

Jan. 31, 2017

Jan. 31, 2016

Jan. 31, 2017

Jan. 31, 2016

Jul. 31, 2016

Commitments And Contingencies [Line Items]

Employment termination conditions

Mr. Ulansky's and Ms. Irons' employment for cause. If (i) Mr. Ulansky's or Ms. Irons' employment is terminated by the Company without cause, (ii) Mr. Ulansky or Ms. Irons terminates his or her employment as a result of the Company assigning him or her duties inconsistent with his or her position or the Company fails to pay his or her compensation, or (iii) there is a change in control in the Company, then in either case the Company shall pay Mr. Ulansky or Ms. Irons an amount equal to (a) the product of the number of years and fractional years for the remainder of the term multiplied by (b) 50% of the then current base salary in effect as of the date of termination.

Due to related party

$ 570,506

$ 570,506

$ 756,997

Management fees (recovery)

174,478

$ 50,659

$ (186,492)

$ 172,164

Share issued for employment agreements

1,577,544

Minimum future lease payments Fiscal year ending July 31, 2017

2,240

$ 2,240

Minimum future lease payments Fiscal year ending July 31, 2018

4,001

4,001

Employment Agreement | Mr. Ulansky

Commitments And Contingencies [Line Items]

Term of employment

3 years

Due to related party

451,971

$ 451,971

$ 609,392

Number of deferred shares issued

2,553,508

1,324,767

Employment Agreement | Mr. Ulansky | First year

Commitments And Contingencies [Line Items]

Annual base salary

$ 400,000

Employment Agreement | Mr. Ulansky | Second year

Commitments And Contingencies [Line Items]

Annual base salary

450,000

Employment Agreement | Mr. Ulansky | Third year

Commitments And Contingencies [Line Items]

Annual base salary

$ 500,000

Employment Agreement | Jennifer Irons

Commitments And Contingencies [Line Items]

Term of employment

3 years

Due to related party

$ 118,535

$ 118,535

$ 147,605

Number of deferred shares issued

669,689

320,880

Employment Agreement | Jennifer Irons | First year

Commitments And Contingencies [Line Items]

Annual base salary

$ 125,000

Employment Agreement | Jennifer Irons | Second year

Commitments And Contingencies [Line Items]

Annual base salary

137,500

Employment Agreement | Jennifer Irons | Third year

Commitments And Contingencies [Line Items]

Annual base salary

$ 150,000

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COMMON STOCK (Detail Textuals) - $ / shares	6 Months Ended	12 Months Ended
	Jan. 31, 2017	Jul. 31, 2016
Stockholders' Equity Note [Abstract]
Common shares, shares authorized	300,000,000	300,000,000
Common shares, par value (in dollars per share)	$ 0.001	$ 0.001
Number of votes each common shareholders entitled	one vote	one vote
Common stock, shares issued	52,042,286	52,042,286
Common stock, shares outstanding	52,042,286	52,042,286
Common shares offer and sale	10,000,000
Common shares offer and sale, par value (in dollars per share)	$ 0.1695
Equity interest in Mineracao Batovi	17.60%

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LOAN TO OPERATOR OF MOLEJON GOLD MINE PROJECT (Detail Textuals)	1 Months Ended
	Jan. 22, 2016 USD ($) oz	Jan. 31, 2017 USD ($)
Agreement [Line Items]
Advance to company		$ 215,000
Blendcore LLC, a Delaware corporation ("Blendcore") and Petaquilla Gold, S.A., a Panama corporation ("Petaquilla Gold") | Loan agreement
Agreement [Line Items]
Loan principle amount	$ 250,000
Blendcore LLC, a Delaware corporation ("Blendcore") and Petaquilla Gold, S.A., a Panama corporation ("Petaquilla Gold") | Loan agreement | Gold, Ounces
Agreement [Line Items]
Number of gold ounces produced for limited royalty | oz	2,000

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GOING CONCERN AND LIQUIDITY CONSIDERATIONS (Detail Textuals) - USD ($)	3 Months Ended		6 Months Ended
	Jan. 31, 2017	Jan. 31, 2016	Jan. 31, 2017	Jan. 31, 2016	Jul. 31, 2016	Oct. 26, 2010
Going Concern and Liquidity Considerations [Abstract]
Net income (loss)	$ (221,313)	$ (73,725)	$ 103,444	$ (234,624)
Accumulated deficit	$ (1,337,113)		$ (1,337,113)		$ (1,440,557)	$ (1,337,113)