Petra Diamonds Regulatory News (PDL)

24 Sep 2007 07:01

Petra Diamonds Ld24 September 2007 24 September 2007 AIM: PDL Petra Diamonds Limited Koffiefontein Mine Produces Strong Second Tender Results Petra Diamonds Limited ("Petra" or "the Company") announces the results of thesecond sale of diamonds from the Koffiefontein mine, following the first tenderresults announced on 7 August 2007. Highlights • 11,548 carats sold (underground production) for a total consideration of US$4.85 million, including an exceptional stone of 74.7 carats • The 74.7 carat stone was sold for US$1,012,636 (US$13,556 per carat), being the first ever diamond produced by Petra that sold for more than US$1 million • The average value achieved for the 11,548 carats (including the 74.7 stone) was US$420 per carat; the average value excluding the 74.7 carat stone was US$334 per carat • These average values are in line with those achieved in the first tender and therefore Petra management has now increased its longer term expectations for the value of underground production from the Koffiefontein mine Adonis Pouroulis, Chairman of Petra, commented; "Koffiefontein is renowned forthe exceptional quality and value of its diamonds and, based on the consistentlyhigh average values per carat achieved at the two recent tenders, Petra hassubstantially upgraded its management revenue expectations for the mine. Theacquisition of Koffiefontein introduced a major diamond mine to the Petraportfolio of producing assets, further consolidating Petra's position as AIM'sleading diamond mining and exploration group." The Koffiefontein mine is in South Africa and was recently acquired by Petrafrom De Beers Consolidated Mines Limited ("De Beers"). The average sales valueachieved at the first tender of Koffiefontein production (announced 7 August2007) was U$367 per carat (excluding an exceptional 60.25 stone sold forUS$736,000) and the prices received from the second tender, at US$334 per carat(excluding the 74.7 carat exceptional stone), are in line with those achieved onthe first tender. Based on these sale prices achieved, Petra management has significantlyincreased its revenue projections for the mine. Managements approach is not toinclude exceptional stones in revenue planning, hence stones such as the 74.7carat sold for US$1,012,636 and the 60.25 carat stone sold for US$736,000 onlyadd to these revenue expectations. Petra has now sold a total of 28,246 carats from both Koffiefontein tenders forUS$11.7m. The 135.6 carat stone that was recovered in August (as announced 17August 2007) will be sold at the next tender, to be held in October. Petra's net interest in Koffiefontein is 70%, with its BEE partners holding theremaining 30%. Correction re. media articles on Kimberley Underground announcement Petra announced on Friday 14th September 2007 that it had entered into aconditional agreement with De Beers to acquire the mining and associated assetspreviously used by De Beers in the operation of the Kimberley Undergrounddiamond mines ("Kimberley Underground"), which are situated near Kimberley,South Africa. It has come to the Company's attention that several media articles relating tothis announcement incorrectly stated that Petra's production is expected toreach 300,000 carats per annum, following the integration of KimberleyUnderground. In fact, based on historical production and sales information, Petra expectsannual sales from Kimberley Underground in excess of 100,000 carats at anaverage of US$160 per carat once full production is recommenced, giving grossannual revenues in excess of US$16 million and a life of mine of at least 12years. Combined with Petra's existing fissure mines and the Koffiefontein minein South Africa, this additional production from Kimberley Underground wouldcontribute annual production in two years time of around 400,000 carats. Ends For further information, please contact: Justine Howarth / Louise Goodeve Telephone: +44 (0) 20 7851 7480Parkgreen Communications, London Adrian Hadden Telephone: +44 (0) 20 7523 8000Collins Stewart, London This information is provided by RNS The company news service from the London Stock Exchange