Stellar Diamonds Regulatory News (STEL)

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21 October 2014

AIM: STEL

Stellar Diamonds plc

("Stellar" or the "Company")

Large Diamonds Recovered from Trial Mining at Baoulé Kimberlite, Guinea

Stellar Diamonds plc, the London listed (AIM: STEL) diamond development company focused on West Africa, announces results from the trial mining production of the five hectare Baoulé kimberlite pipe in Guinea ("Baoulé").

Highlights:

· 196 carats recovered to date from kimberlite ore at an average grade of 17cpht (+1.25mm cut-off) exceeding minimum grade expectation of 13cpht

· Gems of 5.5 (octahedron), 5.1 (octahedron), 3.0, 1.9, 1.5, 1.3 and 1.2 carats recovered

· Over 50% of diamonds recovered classified as gem quality

· Trial mining is expected to generate cash flow from first diamond sale targeted before YE 2014

· Mine plant functioning well, with steady increase in tonnes of ore processed

Stellar Diamonds Chief Executive Karl Smithson commented:

"Processing of the first kimberlite ore from trial mining at the Baoulé pipe is delivering excellent results. Not only is the grade exceeding our minimum expectations but the recovery of three five carat diamonds, two of which are of excellent gem quality and shape, from a 196 carat diamond parcel is outstanding news. We believe that this suggests that Baoulé has a large stone size distribution which would be consistent with our expectations, knowing that the Aredor area of Guinea has produced some spectacular stones over many years. The processing plant, which was commissioned in September, is working well and we will now increase volume throughput over the coming weeks. It is our intention to make a diamond export in November and thus begin our cycle of exports and sales for the duration of the trial mining period."

Trial Mining

Following on from successful plant commissioning in September 2014, the processing of the first kimberlite sample from Baoulé has been completed as part of the scale up to trial mining. A carefully measured kimberlite sample was collected from a trench with dimensions of 24m x 16m x 3m. A number of representative samples of this kimberlite were selected for specific gravity and moisture content measurements. On this basis, the calculated wet and dry tonnages of this sample were 1,802t and 1,164t respectively. Processing of this kimberlite has been completed, with current throughput of approximately 50 wet tonnes per hour being achieved.

Diamond Results

A total of 195.57 carats were recovered at a +1.25mm cut off, giving a grade of 16.8cpht. This compares favourably with the historically reported +1mm grade of 13.2cpht. Including the 33.2 carats recovered from commissioning of the plant with lower grade material, a total of 228.77 carats have been recovered to date.

Encouragingly a number of larger diamonds were recovered from this relatively small sample, including two octahedral gem diamonds weighing over five carats each. A third five carat diamond was also recovered, though this is of lower quality. The Directors believe the presence of these five carat diamonds, plus a number of other diamonds greater than one carat in size, could suggest that the Baoulé Pipe has a large stone size distribution. Gem diamonds represent approximately 57% of the diamond population recovered, with 43% being classified as industrial or near gem.

Further analysis of these results will be undertaken to further quantify and model these results as trial mining continues.

Ebola Update

Operations are continuing but conditions are being closely monitored at Baoulé. The Company has been at the forefront of elevating awareness amongst the workforce and the surrounding local communities and civic leaders of the threat of Ebola and its prevention. Increased levels of sanitation and health screening have been established at the camp and project sites and are being rolled out to the homes of the Company's employees. Restrictions on staff travel are also implemented and a total ban on travel to the epicenters of the Ebola virus in Guinea is in place. The Company continues to monitor the situation very closely to ensure the continued well-being of all employees and that of the local communities.

About Stellar Diamonds plc

Stellar is an AIM quoted (AIM: STEL) West African focused diamond development company which has commenced trial mining of its Baoulé kimberlite in Guinea, and is progressing the 1.1 million carat Tongo Dyke-1 resource in Sierra Leone through a definitive feasibility study. In addition, Stellar holds the 3 million carat Droujba project in Guinea and continues to pursue both diplomatic and legal channels to ensure the proper reinstatement of its Kono licences in Sierra Leone.

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