AMI.L Regulatory News (AMI)

27 Sep 2005 07:01

Sierra Leone Diamond Company Ld27 September 2005 For Immediate Release 27 September 2005 Sierra Leone Diamond Company Limited ("SLDC" or the "Company") Exploration Update Sierra Leone Diamond Company (AIM : SLD), the diamond exploration company withlicence interests wholly focussed in the country of Sierra Leone, is pleased toreport on the progress being made at its various exploration and developmentassets in Sierra Leone. Hard Rock Exploration The first phase reconnaissance stream sediment sampling programme of theCompany's property holdings in northern Sierra Leone is nearing completion. Datareceived to date confirms the discovery of a new kimberlite province in thisregion, previously thought to be barren. Several kimberlitic ilmenites and otherindicator minerals - not associated with the known Koidu pipes - have been foundin the Kamakwi and Kono areas. The largest diamonds found on the Company'sproperties so far from previous alluvial production were 56ct and 28ct. Thediscovery of hard rock sources bodes well for the future exploration programme. The High Resolution Aero Magnetic data is being interpreted, and has lead to theconfirmation of several new targets. 137 targets have so far been identified inthe Kamakwi area, and eight at Marampa. Alluvial Diamond Operations Drilling of the alluvial terraces on the Sewa River in the Mofwe area continuesto confirm previous estimates of their extent. Limited sampling of theseterraces has confirmed that these terraces are diamondiferous, with a total of272 stones being recovered during the course of the programme. The Company hasso far completed 980 boreholes / pits and outlined initial potential resourcesof 330,000 cubic metres of gravels, with gravel band thicknesses up to 11 metresin places. The largest diamond recovered from this alluvial sampling is a gemquality 3.2 carat stone. Preliminary assessments at the Kono properties have shown significant potentialfor terraces of previously un-worked alluvial gravels. Bulk sampling of thesealluvial targets in the Kono area will commence within 1 month. Iron Ore Deposits The Company is now in receipt of a desk top study carried out by Snowden MiningIndustry Consultants "Snowden", regarding its large Marampa and Tonkolili ironore deposits. Previous resource estimates had indicated a resource of over 600Mtof iron ore at Tonkolili and SLDC estimate the potential total resource being inexcess of 1 billion tons. Snowden's economic assessment has suggested a primafacie economic operation could be constructed with an IRR in excess of 20percent. Given the non-core nature of this asset, and the potentiallysignificant capital expenditure that this would require, SLDC is seeking JointVenture partners for this development. Commenting on these results, SLDC's Chief Executive Mr David Gadd-Claxton, said:"We are pleased to see that the exploration program is delivering results inline with our expectations. Furthermore, the Snowden Iron Ore valuationunderlines the value potential of the mineral resources in Sierra Leone and ofthe Company". For further information please contact:Sierra Leone Diamond Company Limited 44 (0)1 442 257 246David Gadd-Claxton, President and Chief Executive Buchanan Communications 44 (0)20 7466 5000Bobby MorseBen WilleyFrances Adigwe SLDC is a diamond exploration company wholly focused on Sierra Leone. It holds20 exploration and prospecting licences over 36,364 km2. The primary target isdiamond-bearing kimberlite pipes. Secondary objectives include alluvial diamondproduction, as well as exploration for gold, iron ore, bauxite, rutile, rareearths and other minerals. SLDC is exploring the mineral potential of thelicence areas through a long-term, systematic exploration programme beingcarried out by a dedicated team of geologists and support staff. This information is provided by RNS The company news service from the London Stock Exchange