Stellar Diamonds Regulatory News (STEL)

4 Mar 2009 07:00

WEST AFRICAN DIAMONDS PLC

GUINEA UPDATE

Highlights:

*  Mine commissioning to commence at Bomboko in March, production April

*  A plant to allow bulk sampling of the Droujba kimberlites has been set up and is being commissioned

*  A drill rig is on site at Droujba. Drilling to define the size of the kimberlites will commence in March

The board of West African Diamonds plc, the AIM listed diamonds and precious metals explorer and developer (AIM: WAD), is pleased to provide an update on its activities in Guinea. 

Engineering work is completed on our Bomboko alluvial mine located near the Aredor diamond mine. Pre-production testing will commence towards the end of March followed by production in April. The mine will commence operations with a 10 foot Pan Plant capable of treating 7,000 tonnes a month. Initial production will be from a stockpile adjacent to the plant. A 16 foot Pan Plant supported by a 46 tonne excavator will be installed during April. This will enable an increase in production to 18,000 tonnes a month.

A mobile Dense Media Separation (DMS) unit has been installed and commissioned on the Droujba kimberlite licence. A drill rig has arrived and is being commissioned. A drill programme to bulk sample the kimberlites and the geophysical targets identified on the surrounding ground will start within weeks.

James Campbell, Deputy Chairman of West African Diamonds, commented:

"Despite the turmoil in the diamond industry, it is good news that we have been able to build our Bomboko mine on time and within budget - we have taken the asset to the brink of production and look forward to collating our first package of diamonds for sale.

Diamonds are scarce and remain highly desirable in both consumer and industrial markets. Whilst the current lack of credit may reduce prices or even cause a postponement of sales due to the hits taken by the sightholders, we are confident that the long term future for the quality of diamonds from Guinea is bright.

Droujba is a fine prospect. We eagerly await the results of the bulk sampling. With production from Bomboko and a number of attractive development and exploration projects, significant value has been uncovered in a short period. We believe WAD remains an attractive overall package."

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