Stellar Diamonds plc
(“Stellar” or the “Company”)
STRATEGIC & OPERATIONAL UPDATE
Stellar Diamonds plc, the London listed (AIM:STEL) diamond exploration and development company focused on West Africa, announces its strategic decision to accelerate the development of its hard rock kimberlite projects and provides an update on its alluvial diamond operations.
Highlights:
- Stellar to focus on the development of its kimberlite diamond projects
- Bomboko sale realises record average price of $201/ct
- Mandala diamond production of 10,264 carats in Q4 2010 at an average grade of 16cpht
- 10,048 carats sold in February realising $361,500
Strategic focus on kimberlite portfolio
In light of the strong rebound in diamond prices as evidenced by the record diamond prices achieved from the recent sale of a parcel of diamonds from the Company’s Bomboko project, as well as those achieved by other diamond producers, the Board of Stellar has decided that substantial value may be created by focusing the Company’s human and other resources on fast tracking the development of its hard rock kimberlite portfolio. These projects include the Droujba kimberlite pipe in Guinea and the Tongo kimberlite dyke in Sierra Leone. If proven economic, the Board considers that these projects have the potential to generate substantial revenues over long mine lives and in turn have the potential to transform Stellar into a significant diamond production company in Africa.
Recently announced results from drilling at the Droujba kimberlite pipe indicate that it has a number of hallmarks of a potentially substantial kimberlite deposit with significant diamonds counts, including commercial sized stones, and with the pipe remaining open below 120m. Kimberlite has also been intersected in a priority geophysical anomaly adjacent to the pipe, confirming the suspicion of an extension to the pipe at depth. Similarly the recently announced initial bulk sampling results from Dyke 1 of the Tongo project suggest it has the potential to be a high value kimberlite ore body, with an undiluted grade of 130cpht and a diamond value in the order of $169/ct having been reported. This suggests that the Tongo kimberlite has a potential in-situ value of $220 per tonne. Stellar has also recently embarked on a bulk sampling exercise of the Bouro North kimberlite dyke, located 1km from the Company’s Mandala diamond processing plant in Guinea. Previously announced grades from Bouro suggest it has the potential to be significantly diamondiferous, with grades of up to 500cpht reported which potentially make it one of the most diamondiferous kimberlites globally.
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