14 Oct 2010 07:00
NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION TO US NEWS WIRE SERVICES.
14 October 2010
AIM: STEL
Stellar Diamonds plc
("Stellar" or the "Company")
Mandala Diamond Mine Quarterly Progress Update
Stellar Diamonds, the London listed (AIM:STEL) diamond mining and exploration company focused on West Africa, is pleased to announce an operational update for its Mandala diamond mine in south east Guinea for the third quarter of 2010.
Highlights:
·; Quarterly production from Mandala of 18,291 carats, up 31% on second quarter
·; Quarterly sales from Mandala of 18,549 carats at an average price of $33 per carat
·; Quarterly revenue from Mandala of $609,000
·; Diamonds in stock of 8,194 carats
·; Total production at Mandala has now exceeded 102,000 carats
At the Mandala diamond mine, production for the third quarter ending September 2010 yielded 18,291 carats at an average grade of 23.39 carats per hundred tonnes ("cpht") of mined gravel. The quarterly production was significantly higher than the second quarter (13,913 carats) primarily as a result of the introduction of new earth moving machinery in late July and irrespective of the seasonal rains forcing production to lower grade high terrace deposits.
Diamond sales from Mandala in the third quarter comprised 18,549 carats at an average price of $32.82 per carat, for revenue of $608,819, though 8,194 carats were in stock at the end of the quarter. Sales for 2010 to date total 51,471 carats for revenue of $1,742,635. The average price per carat for 2010, compared to 2009 is $33.86 per carat versus $28.16 per carat, 20% higher, reflecting the general improvement in global diamond prices in the period.
Total production at Mandala since the Company commenced mining in April 2009 has now exceeded a major milestone of 100,000 carats, at an average grade of 34cpht.
Karl Smithson, Chief Executive Officer, commented:
"Production at Mandala during the third quarter saw an increase of 31% on the second quarter figures even though heavy seasonal rains caused mining operations to focus on lower grade areas. With improving weather conditions I am confident that production and revenues, as well as margins, can be further enhanced in the coming months.
"Passing the 100,000 carat mark at Mandala is an important milestone for Stellar and demonstrates our capability to deliver mining projects in West Africa, a region where the Company believes several more mines may be developed from within its existing portfolio."
About Stellar Diamonds plc
Stellar Diamonds plc is a London (AIM: STEL) listed diamond mining and exploration company that has a portfolio of projects in West Africa. Two projects in Guinea, Mandala and Bomboko, are in mining and trial mining respectively, which provide cash flow to the Company.
Stellar also owns full rights over four high-grade kimberlites that are to be the focus of future development. In Sierra Leone at the Tongo project a bulk sampling programme is currently underway on one key kimberlite to assess the diamond grade and value, whereas at the Kono project underground trial mining has produced 4,200 carats as part of an economic evaluation exercise. In Guinea the Company's Droujba kimberlite pipe and Bouro kimberlite dykes are located in proximity to the Company's Mandala mine and demonstrate high diamond grades. Droujba will be drilled in the near future.
For further information please contact the following or visit the Company's website at www.stellar-diamonds.com.
Stellar Diamonds plc
Karl Smithson, Chief Executive Tel: +44 (0) 7783 707971
Angus Ogilvie, Finance Director Tel: +44 (0) 7885 201 903
RBC Capital Markets
Martin Eales / Daniel Conti Tel: +44 (0) 20 7653 4000
Astaire Securities
Charles Vaughan Tel: +44 (0) 20 7448 4400
Pelham Bell Pottinger
Charles Vivian / James MacFarlane Tel: +44 (0) 20 7861 3232