FDI.L Regulatory News (FDI)

6 Mar 2007 07:02

Firestone Diamonds PLC06 March 2007 Firestone Diamonds plc Awarded prospecting license for new kimberlite in Botswana LONDON: 6 March 2007 HIGHLIGHTS • New prospecting license granted for highly prospective BK11 kimberlite in Botswana • Located 20 km from the Orapa Mine and 5 km from AK6 kimberlite • Historical grades of up to 17 carats per hundred tons; size estimated at 6.5 hectares • Bulk sampling planned for H2 2007 Firestone Diamonds plc, ("Firestone" or "the Company"), the AIM-quoted diamondmining and exploration company (ticker: AIM:FDI), today announces that it hasbeen awarded a prospecting licence for the BK11 kimberlite, which is located inthe Orapa kimberlite field. BK11 is situated approximately 20 kilometres southeast of De Beers' Orapa Mine and 5 kilometres north east of the AK6 kimberlite,on which De Beers and African Diamonds are developing a major new mine.Previous work on BK11 has produced grades between 2 and 17 carats per hundredtonnes ("cpht"). The Company intends to carry out a detailed evaluationprogramme on BK11, with bulk sampling results expected to be available in thesecond half of 2007. Philip Kenny, CEO of Firestone Diamonds, commented: "It is a very positivereflection on Firestone's technical capability that we have been awarded thelicence for BK11, which we believe to be a very prospective kimberlite. Withthe infrastructure already available in the Orapa area and a new mine beingdeveloped 5 kilometres away at AK6, the grade required for BK11 to beeconomically viable will be modest." BK11 background BK11 was discovered by De Beers in 1974, but limited evaluation was carried outat the time. In the early 1990's Debswana Diamond Company undertook a programmeof 12" diameter percussion drilling on BK11, which yielded a grade ofapproximately 16 cpht. It is significant to note that a similar programmecarried out at the same time on AK6 yielded a grade of approximately 17 cpht,but that larger scale bulk sampling carried out on AK6 in 2005 by the De Beers/African Diamonds joint venture yielded a substantially higher grade of 25 cpht. The De Beers/African Diamonds joint venture carried out some evaluation work onBK11 in 2005. A single 24" diameter hole was drilled to 170 metres and yieldeda grade of 2.4 cpht. However, a subsequent review of ground geophysical dataindicated that the bulk sample hole was sited on a small magnetic high on theedge of BK11. This feature, which represents about 10% of the surface area ofthe kimberlite, is interpreted as being a separate intrusion from the rest ofthe body, and the bulk sampling results may not therefore be representative ofthe entire kimberlite. The joint venture reported that that more work wasrequired. However, it was not possible to carry out any further work as theprospecting license under which BK11 was held expired. The surface area of BK11 is estimated to be 6.5 hectares, and overburden isshallow at less than 20 metres. New prospecting licence Applications for a new prospecting licence over BK11 were submitted in 2006 byseveral companies. Firestone submitted its application through Monak Ventures(Pty) Limited ("Monak"), a Botswana company which is 80% owned by Firestone and20% by Botswana nationals. Following a review of the work programmes proposedby the competing applicants, the Ministry of Minerals & Energy has awarded theprospecting licence to Monak. Evaluation programme Firestone plans to carry out a detailed evaluation programme on BK11 toestablish a representative grade for the entire kimberlite and to recoversufficient macro diamonds to provide an estimate of the diamond value. Thisprogramme will consist of follow-up ground geophysics, core drilling and largediameter drill bulk sampling and will be carried out in parallel with theevaluation programme which is underway on the Company's Tsabong project inBotswana. Drilling is expected to commence in Q2 2007, with bulk samplingresults available in H2 2007. Subject to the results of this work, resourcedelineation work would be undertaken in 2008. For further information: Philip Kenny, Firestone Diamonds +44 20 8834 1028 / +44 7831 324 645 Laurence Read/Jos Simson, Conduit PR +44 20 7429 6605 / +44 7979 955 923 Jamie Cumming, Bell Lawrie +44 141 314 8103 / +44 7768 044 620 Kenneth Fleming, Bell Lawrie +44 141 314 8114 / +44 7971 835070 www.firestonediamonds.com Background information on Firestone Diamonds: Firestone Diamonds plc is an international diamond mining and explorationcompany with operations in the Namaqualand region of South Africa, Botswana andthe United States. Firestone has extensive interests in Botswana, which is the world's largestproducer of diamonds, with annual production of approximately 30 million caratsworth over $2.5 billion. Botswana is considered to be one of the best countriesin the world to explore for kimberlite - the primary source rock for diamonds. Firestone controls the Tsabong kimberlite field in south western Botswana,approximately 280 km south west of the Jwaneng Mine, which is the world'sbiggest diamond mine. Tsabong is one of the largest diamondiferous kimberlitefields in the world, containing 77 known kimberlites, of which 17 have beenproven to be diamondiferous. Tsabong is noted for the exceptionally large sizeof many of its kimberlites, in particular the 180 hectare M1 kimberlite, whichis one of the largest known diamondiferous kimberlites. The Tsabong field alsocontains 5 kimberlites larger than 50 hectares and 30 kimberlites between 20 and50 hectares in size. Firestone's Orapa and Jwaneng projects are located close to the major Orapa andJwaneng mines and are being explored by De Beers in joint venture withFirestone. Namaqualand, which is located on the west coast of South Africa, has been one ofthe world's largest alluvial diamond producing regions for the past 60 years,with total production to date estimated to be worth more than $3 billion.Firestone's mining operations in Namaqualand include the Bonte Koe, Avontuur andOena Mines, all of which produce high quality alluvial diamonds, and a growingportfolio of early stage and advanced exploration projects, of which the GroenRiver Valley project, which is being explored by De Beers in joint venture withFirestone, is the most important. Firestone has a highly qualified management team with extensive experience inthe exploration, evaluation and development of diamond projects. Firestone isquoted on the Alternative Investment Market (AIM) of the London Stock Exchangeand trades under the symbol FDI.L. Note: The information in this statement has been reviewed by Mr. Tim Wilkes, BSc, Pr Sci Nat, who is a qualified person for the purposes of the AIM GuidanceNote for Mining, Oil and Gas Companies. Mr. Wilkes is Chief Operating Officerof Firestone Diamonds plc and has over 25 years experience in diamondexploration, mineral resource management and mining. Mr. Wilkes is a member ofthe sub-committee for diamonds of the South African Mineral Resource Committee(SAMREC). This information is provided by RNS The company news service from the London Stock Exchange