DiamondCorp Plc (DCP)

DiamondCorp Plc (DCP)

DiamondCorp Plc (DCP) - MARKET UPDATE JULY 2008

DiamondCorp plc, the South African diamond mining company, is pleased to provide the following update on its activities for the six months ending 30 June 2008.

• 27,103 carats of diamonds were recovered from Lace tailings re-treatment in the first six months of 2008, including a 34.84 carat non-gem diamond. Recoveries averaged 6.1 carats per hundred tonnes and approximately 70% of diamonds recovered were gem quality.
• 19,214 carats of gem diamonds sold at tender in Johannesburg for US$1.163 million, at an average price of US$61 per carat.
• Accelerated development of Phase Two underground mining at the Lace Diamond mine is now 14 months ahead of original schedule.
• A new 4m x 4m decline advancing at a rate of 120m per month, with the Lace Satellite kimberlite pipe expected to be reached in the next three months.
• Connection to a second Eskom power supply from a new power line servicing the nearby De Beers Voorspoed diamond mine was completed. As a result, the impact of power outages and load shedding is expected to be significantly reduced.
• Approximately 200,000 tonnes of re-crush material has been stockpiled awaiting purchase and commissioning of new re-crush crusher. The existing re-crush cone crusher, which has proved to be unsuitable for this purpose, is being relocated to a secondary crushing function for the underground material. Alternative re-crush crushers are being tested.
• Up to 40 per cent of expected revenues from tailings are contained in the re-crush material, which will not be realised until the re-crush crusher is replaced.

Commenting on the period, DiamondCorp CEO Paul Loudon said:
“DiamondCorp’s operations have progressed significantly over the past six months. First pass recoveries from the tailings re-treatment operation are now in line with original estimates and issues with power supply and the re-crush circuit have been addressed.

“At the same time, the development of the Lace underground project is now 14 months ahead of the original schedule, with initial kimberlite recovery from the Lace Satellite pipe expected by September 2008.

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