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10 October 2008

AK06: Terms of Mining Licence Agreed

The directors of African Diamonds (AIM:AFD) are pleased to announce that agreement has been reached with the Government of Botswana on terms for a Mining Licence to develop the AK06 diamond discovery in Orapa, Botswana.

The principal terms are;

• licence issued 10 October 2008 for 15 years

• production must commence by April 2011

• no government equity in the project

• normal royalty of 10 per cent

• variable tax rate according to the 12th Schedule of the Botswana Income Tax Act

• output sold through the Diamond Trading Company in Botswana

• a government undertaking that power will be supplied from the national grid

John Teeling, Chairman of African Diamonds commented:

'This is an important milestone for African Diamonds. A Mining Licence provides certainty for all stakeholders. We believe the agreed terms to be equitable to all parties and we look forward to developing AK06 as quickly and as effectively as possible.'

Further information:

African Diamonds Plc 

John Teeling                                        Tel: +353 1 8332833

Alex van Zyl                                        Tel: +27 83 261 2956

James AH Campbell                            Tel: +27 83 457 3724

RBC Capital Markets

Andrew Smith                                    Tel: +44 20 7029 7882

Martin Eales                                      Tel: +44 20 7029 7881  

College Hill

Paddy Blewer                                    Tel: +44 (0) 20 7457 2020

Nick Elwes                                        Tel  +44 (0) 20 7457 2020

www.afdiamonds.com

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