Kagem Mine Management Contract Awarded

8 Nov 2007 07:00

8 November 2007 Gemfields Resources plc (`Gemfields') Management contract awarded at the Kagem Mine, Zambia

Gemfields Resources plc (AIM: GEM), the AIM-listed Zambian gemstone mining and exploration company, today announces that it has been awarded a management contract with Hagura Mining Ltd ("Hagura") to manage and operate the Kagem Emerald Mine which is situated in the Ndola Rural Emerald Restricted Area of Zambia ("NRERA").

The Kagem mine is Africa's largest emerald mine, having produced more than 25 million carats of emeralds in the past five years and is located 15km by road and less than 1km along the strike from the Company's Mbuva-Chibolele mine, which is one of two producing mines in the Company's portfolio.

The agreement with Hagura, which owns a 75% interest in Kagem, along with 25% held by the Government of the Republic of Zambia, is to provide all day to day management and operational skills including the provision of personnel and equipment.

Commenting today, Rajiv Gupta, Executive Vice-Chairman of Gemfields said: "Gemfields is delighted to have signed this management agreement as it signifies a vote of confidence in the management and operational teams we have built. Our primary focus remains on operating and consolidating various gemstone mines in Zambia, where we currently own 100% of two mines (Mbuva-Chibolele and Kamakanga) and some 60% of the prospective strike lengths of host rock for emerald bearing pegmatites in the NRERA".

A spokesperson for Hagura Mining Ltd commented: "Gemfields has developed tremendous emerald exploration and mining techniques which place them in an ideal position to assist in the development of Kagem".

For more information:

Gemfields

Peter Kitchen, CEO peter.kitchen@gemfields.co.uk

Richard James, CFO richard.james@gemfields.co.uk

+44 (0)20 7016 9416

Conduit PR

Leesa Peters/Arabella Hobbs +44 (0)20 7429 6600

+44 (0)781 215 9885

Canaccord Adams Limited

Robin Birchall/Ryan Gaffney +44 (0)20 7050 6500