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Global Diamonds commissions Kao processing plant in Lesotho

·        
 First Diamonds Recovered Include “Beautiful,
Clear 0.86ct Stone”

·        
Only Diamond Mine
In Country To Meet Approved Mining Lease Timeframe

·        
Refurbishment Of
200-Man Accommodation Camp Nears Completion
 

Global Diamond Resources plc (formerly Lesotho Diamond
Corporation) is pleased to report that its Kao diamond mine in Lesotho was commissioned on November
22.  “This is a great tribute to all of
the staff involved, bearing in mind the difficult terrain in which the mine is
located and the extreme weather conditions that have impeded completion of the
mine processing unit”, says chairman Mr Morven Hay.

In a letter to the private company’s shareholders, he says
that during the first weekend of operations, some 30t of alluvial gravel was
processed in the 150t/hour processing plant and the first diamonds were
recovered, including  “a beautiful clear
0.86ct stone”. 

“This is a great milestone for the company and a huge step
forward towards making GDR a significant player in the world diamond market.
Along with the acquisition of diamond assets in Democratic Republic of Congo
(DRC), this places the company in a strong position to move forward”, the
chairman adds.

In reaching the commissioning stage, the Kao project has
achieved a number of targets.  The
processing plant was completed in 14 months, well within the 21 month timeframe
in the approved Mining Lease.  “This is
the only diamond mine in Lesotho which has been able to meet this
approved timeframe”, says Mr Hay. 

In addition, the Government of Lesotho has signed a 7-year
lease with Kao Diamond Mine (Pty) Ltd (KDM) to take over the Ha Lejone
accommodation and administration camp where a programme of renovation and
refurbishment will be completed later this month.  KDM will thus save the initial capital
required to house all employees and contract workers at the mine.

The 44 two and three-bedroom houses will be able to accommodate
up to 200 workers.  KDM’s new general
manager, Gerhard van Niekerk, who has over 25 years mining experience, 10 of
which were with De Beers, will shortly move into the camp with his wife, and
the company’s administration and finance team will follow shortly. 

The other major milestone achieved this year is agreement on
the power plant JV project which now has the full support of its four JV
partners. The plant is scheduled to come on line by the end of 2009 and is
essential to ensure the viability of Stages II 
and III of the Kao project.

Commenting on the company’s assets in the Tshikapa diamond
region of the DRC, Mr Hay says it has agreed to acquire from Greenstone
Diamonds Limited ten concessions comprising kimberlite prospecting and alluvial
mining operations in the Tshikapa district immediately north of the Angolan
border.  It is envisaged that GDR will
conduct selective trial mining to confirm the average grade and value of the
resources in order to determine the feasibility of the project.   It will then move to acquire full mining
licences, if appropriate, which will necessitate the transfer of 5p.c. of the
shares in the DRC subsidiary to the DRC Government.

DUAL MARKETING
STRATEGY 

GDR, through its Global Diamond Tenders marketing agency,
will employ a dual marketing strategy to maximise revenues by selling large
diamonds by tender in Antwerp and smaller diamonds directly to
Indian polishing houses from Dubai’s Almas Tower. 
The company also aims to train Lesotho nationals to value and sort
diamonds within a relatively short period of time.

Further information:

Morven Hay, Global Diamond Resources plc, Tel: 020 7659 5200

                        Ron
Marshman, City of London PR Ltd, Tel: 020 7628 5518

http://www.globaldiamondres.com/

 
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