PRG.L Regulatory News (PRG)

Paragon Diamonds Limited / Index: AIM / Epic: PRG / Sector: Resources 12 December 2014 Paragon Diamonds Limited (`Paragon Diamonds' or the `Company') Share Buy Back and Total Voting Rights Paragon Diamonds Limited, the AIM quoted diamond development company, announcesthat further to the announcements of 11 November and 9 December 2014, theCompany has completed the purchase of 63,000,000 ordinary shares in the Companyat a price of 3p per share. The shares so purchased have been cancelled. Paragon Diamonds' CFO Simon Retter said, "I am pleased to announce thesuccessful completion of the buy back of a significant interest in the Companyfrom Lanstead Capital. Cancelling these shares will have an antidilutive effectfor all current shareholders and I strongly believe this will add significantvalue to the Company. Another step has been taken in progressing the Companytowards its goal and a tidier shareholder register should enable future gainsto be enjoyed by our existing and loyal shareholders. "We are progressing well on both the corporate and operational fronts ahead ofour upcoming stage 1 production (subject to financing), and look forward toupdating shareholders again in the near future." Following this transaction the Company's issued share capital comprises275,524,654 ordinary shares. The Company does not hold any ordinary shares intreasury. Therefore, the total number of ordinary shares with voting rights is275,524,654. This figure may be used by shareholders in the Company as thedenominator for the calculations by which they will determine if they arerequired to notify their interest in, or a change in their interest in, theshare capital of the Company under the FCA's Disclosure and Transparency Rules. **ENDS** For further information please visit www.paragondiamonds.com or contact: Philip Falzon Sant Paragon Diamonds Limited +44 (0) 20 7182 1920Manduca Simon Retter Paragon Diamonds Limited +44 (0) 20 7182 1920 Edward Hutton/Gerry Northland Capital Partners +44 (0) 20 7382 1100Beaney Limited (Nominated Adviser) John Howes/Charles Northland Capital Partners +44 (0) 20 7382 1100Laughton Limited (Sales and broking) Felicity Winkles St Brides Media and Finance Ltd +44 (0) 20 7236 1177 Frank Buhagiar St Brides Media and Finance Ltd +44 (0) 20 7236 1177 Notes Paragon Diamonds has a pipeline of projects in Lesotho, Botswana and Zambia,the most advanced of which is its Lemphane Kimberlite Pipe Project in Lesotho,located close to the world class Letšeng mine, Lesotho's largest diamond mine.Lemphane is the last known kimberlite to be developed in Lesotho. Among thestones recovered in the Company's 2013 bulk sampling programme were severallarge high value stones of up 8.9 carats in size and individual diamond valuesin excess of US$2,400/ct have been achieved, demonstrating the potential forLemphane to hold large and valuable diamonds. The first of a two stageproduction programme is currently expected to commence Q1 2015 (subject tofinancing) which will further define the resource at Lemphane. As increasedtonnages of kimberlite are processed the proportion of larger diamondsrecovered will improve, increasing the average value of diamonds recovered atthe project, as was the case at Letšeng. Stage 1 production will cover a two year period during which approximately 1 Mtof kimberlite will be mined and processed out of the currently estimated 48.6Mtof kimberlite (to 350m depth) at the site, using a 75 tonne per hour processingplant. The Company is targeting 20,000 carats during Stage 1 production with anestimated minimum value of US$930 per carat that is expected to generaterevenues in excess of US$9m per annum. Cash flow will be reinvested to furtherdevelop Lemphane and complete a bankable feasibility study, a 3D geologicalmodel and a substantial inferred resource ahead of commencing the Stage 2production phase. Stage 2 will see production ramped up to 3Mt/year with peakproduction expected to hit 65,000 carats per year of high value diamonds. It is the intention of the Company to become a fully integrated diamond companymaximizing the margins gained from being exposed from the mining to selling ofdiamonds.