Stellar Diamonds Regulatory News (STEL)

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12 February 2014

AIM: STEL

Stellar Diamonds plc

("Stellar" or the "Company")

Continued High Diamond Grades at Tongo Diamond Project, Sierra Leone

Stellar Diamonds plc, the London listed (AIM: STEL) diamond development company focused on West Africa, is pleased to announce that further high diamond grades have been returned from the bulk sampling programme underway at its 1.1 million carat Tongo dyke kimberlite project in Sierra Leone.

Highlights:

· Initial sample processing yielded 151 carats from 141t of kimberlite for a grade of 107cpht with further results expected approximately every four weeks

· Anticipated that diamond grade will increase as further diamonds are recovered following re-processing

· Outstanding quality of diamonds classified as 86% gem quality with several stones greater than 1 carat in size

· Bulk sampling on-going with 772 tonnes collected to date as part of the Dyke-1 mining DFS

· Objective to recover a minimum 1,000 carat parcel for diamond grade and value confirmation

· Previous results established a grade of 120cpht at US$248 per carat from a 1,050 carat parcel

· Definitive Feasibility Study ("DFS") expected to be completed in 2014, culminating in a production decision at Tongo Dyke-1

Stellar Diamonds Chief Executive Karl Smithson commented, "The quality of diamonds observed in these bulk sample results at Tongo is outstanding, with an estimated 86% being classified as gem quality, with many white diamonds exhibiting fine crystal shapes. The results from Tongo have confirmed the continued high grade nature of the 1.1 million carat resource Dyke-1 kimberlite, and following the standard re-processing procedure, we expect the grades to increase in line with the 120cpht level established in the previous results, demonstrating the significant potential at the first of our four kimberlite dykes at Tongo.

"Extraction and processing of the kimberlite bulk sample will form part of our DFS for underground mining at Tongo which is on track for delivery in H2 2014. We look forward to announcing further bulk sampling results from Tongo in the coming months as well as progress at our newly acquired Baoulé joint venture kimberlite in Guinea where we will be working towards defining at least a 3 million carat resource this year."

Tongo Project Summary:

The bulk sampling element of the Definitive Feasibility Study of the 1.1 million carat diamond resource of Dyke-1 is on-going and is aimed at providing enhanced information on the diamond grade and value of the kimberlite. The grade and average modelled diamond value of Dyke-1 had been previously established at 120cpht and US$248 per carat from a 1,050 carat parcel. The current bulk sampling work is geared towards increasing the confidence in these figures by providing a larger diamond parcel for more robust diamond grade and valuation work.

Dyke-1 Bulk Sampling Results:

Bulk sampling of the Dyke-1 bulk sample commenced in October 2013 and has to date delivered 772 tonnes of material to the sample stockpile. Processing of this material commenced in mid-January 2014 using the Company's on-site 5 tonne per hour DMS plant.

The first 250.49 dry tons of mixed kimberlite and granite processed have to date yielded 150.81 carats of +1mm stones at a diluted grade of 60.21cpht. This result represents a diluted sample grade as an estimated 44% of the sample comprised granitic country rock incorporated during the blasting and sampling process. Therefore a calculated 141.27 tonnes of kimberlite have been processed to yield the 150.81 carats at an in-situ grade of 106.7cpht. This figure results from a single pass recovery using a grease table whereas the Company's current standard operating procedure is to run two passes. The Company expects the grade to increase after the second pass recovery to a level in line with the current resource grade of 120cpht.

Processing of the material stockpiled at Tongo is expected to continue for several months and the Company will look to report results approximately every four weeks.

Tongo Dyke 1 Diamond Characteristics

Of the 150.81 carats so far recovered from the bulk sample, 86% are classified as being of gem quality, whereas 14% are classified as non-gem. The Company notes that the diamonds can be classified as predominantly sawables and makeables with a small clivage component. Some nine stones are greater than 1 carat in size.

Pictures of the latest Diamonds from Tongo can be seen at the following link http://stellar-diamonds.com/operations/photo-gallery/tongo-project/latest-diamonds 

About Stellar Diamonds plc:

Stellar is an AIM quoted (AIM: STEL) West African focused diamond development company which is advancing the 1.1 million carat Tongo Dyke-1 resource into the feasibility stage and towards a production decision in 2014. The Company recently signed a joint venture to earn a 75% interest over the multi-million carat potential 5 hectare Baoulé pipe in Guinea. In addition, Stellar holds the 3 million carat Droujba project and continues to pursue both diplomatic and legal channels to ensure the proper reinstatement of its Kono licences.

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For further information contact the following or visit the Company's website at www.stellar-diamonds.com.