FDI.L Regulatory News (FDI)

6 Dec 2006 07:00

Firestone Diamonds PLC06 December 2006 Firestone Diamonds plc Groen River Valley Exploration Update LONDON: 6 December 2006 HIGHLIGHTS • Previous exploration recovered high value diamonds and identified 13 deposits in the GRV project area • Diamonds recovered from bulk sampling on HL deposit • Mobile sampling plant to be erected in Q1 2007 • Bulk sampling on GR2 deposit scheduled for Q2 2007 Firestone Diamonds plc ("Firestone" or "the Company"), the AIM-quoted diamondmining and exploration company, is pleased to provide an update on explorationat its Groen River Valley joint venture exploration project with De Beers inSouth Africa. Exploration on the project to date has identified 13 deposits inthe project area on which a systematic drilling and sampling programme is beingcarried out. HL Deposit Initial results have been received from the follow-up bulk sampling programmecarried out on the southern portion of the HL deposit. The HL deposit is one offive north-south trending Axial Channel deposits in the project area.Approximately 3,000 tonnes of gravel was excavated in four separate blocks fromthe bulk sample pit. The gravel recovered appears to be similar to thegeological unit sampled by the large diameter auger drilling carried out furthernorth on the HL channel earlier in the year, although heavily diluted withangular quartz rubble and clay. Gravel from blocks 1 and 2 has been transported to the sample processing plant,and processing of the gravel has been completed. Block 1 produced no diamondsfrom 889 tonnes of gravel. Block 2 produced five diamonds weighing 1.11 caratsfrom 553 tonnes of gravel. The diamonds are believed to have been recoveredfrom a channel feature in the pit which was only partially sampled by block 2.The diamonds recovered were all high quality gemstones. Individual stone sizeswere 0.15, 0.18, 0.22 and 0.26 carats. These results are encouraging as theyprove that the deposit is diamondiferous, although a full assessment will not bepossible until processing of blocks 3 and 4 has been completed. As a result of very high rainfall in September and October, transporting of thegravel from blocks 3 and 4 to the processing plant has been suspended pendingthe erection of a mobile sampling plant in the Groen River Valley. The mobileplant will be located close to the bulk sample pits and will allow gravel to beprocessed more quickly. Planning for erection of the mobile sampling plant isat an advanced stage, and it is anticipated that the plant will be in fulloperation in Q1 2007. GR2 Deposit Evaluation of the other 12 deposits in the project area is continuing. The nextdeposit selected for sampling is the GR2 deposit, which is one of four east-westtrending Proto Channel deposits in the project area. The GR2 deposit is anattractive exploration target, as previous sampling of Proto Channel deposits ina number of locations elsewhere in the Groen River Valley area has producedgrades of 7-13 carats per hundred tonnes, which would be economically viablegiven the high value of Groen River Valley diamonds. The GR2 deposit is located to the east of the HL deposit and is approximately 4kilometres long and 150 metres wide. Overburden is estimated to vary between 10and 20 metres. Drilling will be carried out in Q1 2007 to identity a suitablelocation for bulk sampling pits, and sampling is expected to be completed in Q22007. Philip Kenny, CEO of Firestone Diamonds, commented: "We are pleased to haverecovered our first diamonds from this phase of sampling in the Groen RiverValley project area. With good results from past exploration on the ProtoChannel deposits in the area, we expect that the next phase of sampling on theGR2 deposit will allow us to make significant progress towards establishing theeconomic potential of the area." For further information: Philip Kenny, Firestone Diamonds +44 20 8834 1028 / +44 7831 324 645 Leesa Peters/Laurence Read, Conduit PR +44 20 7429 6600 / +44 7979 955 923 Jamie Cumming, Bell Lawrie +44 141 314 8103 / +44 7768 044 620 www.firestonediamonds.com Note: The information in this statement has been reviewed by Mr. Tim Wilkes,BSc, MSAIMM, who is a qualified person for the purposes of the AIM Guidance Notefor Mining, Oil and Gas Companies. Mr. Wilkes is Chief Operating Officer ofFirestone Diamonds plc and has over 25 years experience in diamond mining andexploration. Mr. Wilkes is a member of the sub-committee for diamonds of theSouth African Mineral Resource Committee (SAMREC). This information is provided by RNS The company news service from the London Stock Exchange