AMI.L Regulatory News (AMI)

8 Mar 2007 07:01

Sierra Leone Diamond Company Ld08 March 2007 Immediate Release 8 March 2007 Sierra Leone Diamond Company Limited ("SLDC" or "the Company") Exploration and Diamond Sale Update Sierra Leone Diamond Company Limited (AIM:SLD), the diamond producer andexploration company wholly focused on the country of Sierra Leone is pleased toannounce the following update on its kimberlite and iron ore explorationprojects and its next diamond sale. Kimberlite Exploration As a result of the previous countrywide Reconnaissance Drainage Samplingprogramme undertaken, SLDC has a number of high priority kimberlite indicatormineral (KIM) anomaly prospects which are undergoing detailed follow upsampling. Of those, Lake Popei, (referred to in the Company release dated 17November 2006), has been the subject of further recent follow up work followingthe recovery of over 3,000 visually kimberlitic ilmenite grain samples from aninitial 20 litre stream drainage sample. A selection of these grains were sentfor micro-probing and confirmed as kimberlitic in origin. Infill grid soil sampling has yielded an ovoid target which the company believesto be in the region of 1,300m long and 400m wide, as defined by numbers ofkimberlitic ilmenites grain samples, within which is a central core measuringsome 700m by 150m from which highly positive results, in excess of 200 ilmenitegrains per sample, have been recovered. Grid soil sampling involves taking 10litre samples from the ground surface at 2 metre intervals and combining theseto 10 metre composites along 100 metre spaced grid lines. The Company is now suitably encouraged to commit to a drill programme on thistarget. It is expected that drilling will commence within the third week ofMarch following the delivery of two drill rigs. Initially this target will betested with inclined holes down to a planned depth of 150m. Preliminary resultsfrom this drilling programme are expected to be available by the end of April2007. Grid sampling continues on this project with the aim of defining further drilltargets. Iron Ore SLDC is pleased to announce that the government of Sierra Leone has granted tothe Company an exploration licence extension area immediately to the north ofthe existing Tonkolili project. The Tonkolili licence area, (EXPL05/06), wasincreased from 106 km2 to 209 km2 on 28 February 2007 at a cost of US$16,400.The geophysical magnetic signature of the ore body indicates that the geologicalstructure has a strike extent in the region of 24km. On the southern section of the deposit, SLDC has during the past six monthscarried out a surface and underground channel sampling programme which has beenmanaged by RSG Global Limited ("RSG"), the independent technical consultants.Information has been gathered from channel sampling collected continuously alongsurface grid lines varying in length between 500m and 2km. These grid lines werespaced at 600m intervals perpendicular to the strike of the deposit and 2.5km ofchannel samples collected from 27 underground adits accessing material to up to60m below present day land surface. In total 16.1km of sampling has beenundertaken from 18 surface trenches. With the planned completion of a furtherfour trenches by the end of April 2007 it is estimated that a further 3.12km oftrench sampling will have been generated to complete the 600m grid patternacross the 12km of strike of the original licence area. As a result SLDC willmobilize to site a diamond drill rig to test the vertical extent of the primarydeposit. Drilling is planned to start by the end of March 2007. Infill channel sampling to a 300m grid spacing to generate an estimated 17 km ofsampling is due to commence March 2007 on the southern known mineralised area. Achannel sampling program at 600m spacing is planned for the northern extensionto confirm further mineralisation. This program includes an estimated 28.8 km oftrenching. Channel sampling results are being compiled by RSG and these will beincorporated into a 3D conceptual geological model along with the drillingresults. A report on all assays is expected in April 2007. Additional oresamples have been collected for metallurgical testwork with results also due inApril 2007. Diamond Sale The Company is planning a diamond sale in excess of 10,000 carats to commence inAntwerp towards the end of March 2007. The Company adheres to the KimberleyProcess Certification procedures and as such the sale will be made in fullcompliance with this process. The Sierra Leone Government Gold and Diamond Office has valued the planneddiamond sale at US$379.67 per carat and the Company has engaged the services ofOverseas Diamonds NV ("OD"), an industry regarded diamond marketing companybased in Antwerp, with a view to maximising the sale value. The Company will beannouncing the results of the sale as soon as they become available. Frank Timis, Executive Chairman of SLDC, comments, "The Company is very pleased to have been granted an exploration licenceextension area at the Tonkolili project and we have planned an intensive earlystage exploration program to gain a better understanding of the potential ofthis iron ore deposit. We are also delighted to have engaged the services of awell established diamond marketing Company with a view to maximise the value ofour next diamond sale".Enquiries: Sierra Leone Diamond Company Tel: +44 (0) 1442 257 246David Gadd-ClaxtonJamie Alpen Canaccord Adams Limited Tel: +44 (0) 20 7050 6500Mark AshurstMike Jones Buchanan Communications Tel: +44 (0) 20 7466 5000Bobby MorseBen WilleyNick Melson Notes: The information in this report that relates to Exploration Results, MineralResources and or Ore reserves is based on information compiled by P I Young, Pr.Sci Nat (reg. No 400270/05), who is a Member of the Geological Society of SouthAfrica. Paul Young is a full time employee of the Company and meets therequirements as a qualified person for the purposes of the AIM Guidance Note onMining, Oil and Gas dated March 2006 in terms of the diamond industry.It should be noted that potential quantities in this report are conceptual innature and insufficient exploration has been undertaken to define a MineralResource and it is uncertain if further exploration activities will result inthe determination of a Mineral Resource. Some statements in this news release are forward looking and therefore involveuncertainties or risks that could cause actual results to differ materially.Such forward looking statements include comments regarding exploration work.Actual results could differ materially from those anticipated. The Companydisclaims any obligation to update forward looking statements. This information is provided by RNS The company news service from the London Stock Exchange