Stellar Diamonds Regulatory News (STEL)

24 Jan 2008 07:00

West African Diamonds PLC24 January 2008 24th January 2008 WEST AFRICAN DIAMONDS PLC INTERIM RESULTS West African Diamonds ('WAD'), the diamond and gold producing, exploration anddevelopment company today announces its interim results for the six months ended31 October 2007. > First production of diamonds and gold from Plant 11, Sierra Leone. > Cash flow from sales of diamonds and gold booked for February 2008. > Continuing good diamond recoveries on the Bomboko; with large stones and over 200 carats recovered. > Pipe 3 in Sierra Leone has been expanded and a satellite kimberlite discovered. > Gold exploration commenced in the Nimini Hills Greenstone Belt (Sierra Leone). James Campbell, Deputy Chairman of WAD commented: "This has been a transformational period for WAD. We have created a gold anddiamond mine in Sierra Leone and have now commenced production. This producing resource base will provide cash flow to drive our other excitingdevelopment and exploration projects in Sierra Leone and Guinea. We look forward to the future with confidence. With an impressive resource basein the ground and exciting possibilities moving forwards, WAD could become theinvestment of choice in the region." Enquiries: West African Diamonds John Teeling, Chairman + 353 1 8332833 James Campbell, Deputy Chairman +27 83 457 3724 Blue Oar Securities Plc John Wakefield +44 (0) 117 933 0020 Simon Moynagh College Hill Paddy Blewer +44 (0) 20 7457 2020 Nick Elwes www.westafdiamonds.com Chairman's Statement - West African Diamonds - Interim Results for the SixMonths Ended 31 October 2007 I am pleased to report significant progress on a number of projects. We have anexciting portfolio ranging from gold and diamond production to early stageexploration. West African Diamonds ('WAD') is one of the few diamond producerslisted on the stock exchange. It is a tribute to our executives that the Plant11 project was taken from design to production in twelve months. Plant 11 Mine, Koidu, Sierra Leone (60% WAD): Gold and diamond production hascommenced on this approximately 7M tonne plus deposit. The plant has beencommissioned at its nameplate capacity of 150 tonnes per hour and is currentlyoperating on an extended day shift basis. Output is expected to beapproximately 0.4g/t gold worth $9 a tonne of ore and diamonds worth $3 a tonneof ore. Gold pours have already taken place and in excess of 4,580 diamonds (285 carats)have been recovered from the 20,644 tonnes of material treated in the firstmonth of production (mid December 2007 to mid January 2008). A batch treatmentprocess to recover the larger diamonds has been devised and is currently beingimplemented. Gold and diamond contracts are in place and the first sales willtake place in Q1 2008. Bulk sampling is planned on the Plant 6 oversize and undersize tailingsdeposits, which were recently acquired from Fastrack. Bomboko Alluvials, Guinea (100% WAD): Four large diamonds (9.2, 4.5, 4.2 and3.8 carats) and over 200 carats have been recovered from the ongoing bulksampling of this estimated 750,000 carat alluvial diamond deposit. Equipment isbeing refurbished and other pieces acquired to begin small scale mining on theBomboko. The first sale of diamonds from Guinea is expected during Q1 2008. Pipe 3, Sierra Leone (100% WAD): Pipe 3 in Koidu is located adjacent to theKoidu Holdings mine or Pipes 1 and 2. From a kimberlite pipe with very limitedeconomic value, WAD has increased the recoverable grade almost fourfold from 5to 19 carats per hundred tonnes (cpht) by the application of modern Dense MediaSeparation ('DMS') technology and appropriate process controls. A recentgeophysical survey, undertaken by a specialist Canadian firm, has postulated adoubling of the size of the available kimberlite, with the discovery of asatellite kimberlite very close by to Pipe 3. Approximate calculations suggesta target mineable deposit of 350,000 tonnes grading up to 19 cpht and in excessof $228 per carat. The pipes are part of a kimberlite dyke system. WAD hassampled and mapped a 14km strike length going through Pipe 3. Economic optionsare currently being assessed. Droujba, Guinea (100% WAD): This is an area of Guinea well known for diamondscontained in alluvials, kimberlite dykes and pipes. WAD obtained a licence overthe area in April 2007 and has reviewed all available data. There issignificant short term potential in the alluvials, while the geology andeconomics of the kimberlite dykes and pipes need to be assessed. Acomprehensive ground geophysical survey, using four technologies (magnetics,HLEM, gravity and AMT) over the Droujba kimberlite and surrounding dykes wascompleted in Q4 2007 by a specialist South African firm and the data iscurrently in the process of being interpreted. This will supplement an earlierindependent assessment of the Droujba alluvials, which highlighted anexploration potential of between 300,000 and 500,000 carats. Exploration, Nimini Hills Sierra Leone (100% WAD): Early reconnaissance samplingfor gold in the Nimini Hills of Sierra Leone included encouraging results of 63and 73g/t. Follow-up sampling is in an advanced stage of planning in an attemptto discover shear hosted hydrothermal gold mineralised systems. Future: WAD has significant potential. The company is a diamond and goldproducer with a portfolio of projects spanning the full development horizon;from early stage exploration to production and sales. There is an experiencedteam in place, more than capable of developing the portfolio. We are constantly evaluating new projects in diamonds and in metals, not only inWest Africa but elsewhere in Africa, as we are always looking to add value toour portfolio; through acquisition and by monetising our asset base throughdevelopment. We are well on the way towards realising the potential of ourassets. John TeelingChairman 24th January 2008 Financial Information (unaudited) Six Months Ended 31 Oct 07 31 Oct 06 £'000 £'000 Group Profit and Loss Turnover 0 0 Operating Costs (146) (148) --------- --------- Operating Loss (146) (148) Interest Receivable 7 0 --------- --------- Loss before Taxation (139) (148) Taxation 0 0 --------- --------- Loss for the period (139) (148) ========== ========== Loss per share (0.39p) (0.74p) ========== ========== 31 Oct 07 31 Oct 06 £'000 £'000Group Balance SheetFixed Assets 7,058 4,455 --------- --------- Current Assets 778 12Current Liabilities (211) (391) --------- --------- Current Assets less Current Liabilities 567 (379)Creditors (amounts falling due after one year) 0 0 --------- --------- Total Assets less Liabilities 7,625 4,076 ========== ========== Share Capital and Reserves 7,625 4,076 ========== ========== 31 Oct 07 31 Oct 06 £'000 £'000Group Cash Flow Operating Loss (146) (148) Movements in Working Capital 278 173 Net Cash Inflow from Operating Activities 132 25 Returns on Investments and Servicing of Finance 7 0 Capital Expenditure (1,358) (25) Financing - Issue of Ordinary Share Capital 1,400 0 --------- --------- Increase in Cash 181 0 ========== ========== Notes: 1. The figures for the six months to October 31 2007 and October 31 2006 are unaudited. The financial information set out above does not constitute fully statutory accounts within the meaning of Section 240 of the Companies Act 1985. 2. The interim unaudited results have been prepared on a going concern basis and in accordance with International Financial Reporting Standards. 3. Copies of this announcement will be sent to shareholders and will be available for inspection at the Company's Registered Office at 20-22 Bedford Row, London WC1R 4JS. This information is provided by RNS The company news service from the London Stock Exchange