AFRICAN DIAMONDS PLC

5th August 2009 

UPDATE ON DIAMOND EXPLORATION LICENSES IN BOTSWANA

• High potential prospecting license renewed for two years.

• New license granted.

• AK8 and AK9 kimberlites included in renewed licenses.

While the focus of African Diamonds remains firmly on the development of the AK6 diamond discovery in Orapa Botswana, the company continues to work on exploration in the country. We are pleased that two prospecting licenses, PL004 and PL007, have been renewed for two years and a new license, PL605, issued. The licenses are held by Atlas, a 100% owned subsidiary of African Diamonds. Prospecting license (PL004) covers 1112 hectares over AK8, AK9 and BK5 kimberlite pipes, located near the Orapa and Damtshaa mines.  AK8 is a 5 hectare kimberlite pipe containing an estimated 20 million tonnes of ore to a depth of 300 meters below surface, grade of 3 to 7 carats per hundred tonnes (cpht) and a modeled diamond value between US$35 to US$190/ct. AK9 is a 3 hectare pipe containing an estimated 11 million tonnes of ore to a depth of 250 meters below surface, grade of 2.5 to 3.5 cpht, but insufficient carats have been recovered to provide a fair diamond valuation. Geological knowledge of BK5 is very limited at present.  Prospecting licence (PL007) covering 3144 hectares in an area which is also considered highly prospective for new kimberlite discoveries has also been renewed. 

The new prospecting license (PL605) granted to Atlas covers 159 hectares near the Damtshaa diamond mine, an area which is considered highly prospective for new kimberlite discoveries. 

The extension, new grant and renewal of licenses will allow African Diamonds the time and opportunity to evaluate the economic viability of the kimberlite pipes and new targets in the license areas.

This release has been approved by Alex van Zyl, Technical Director African Diamonds. Alex van Zyl (B.Sc. Stellenbosch, B.Sc. Hons. Pretoria) spent a long career in Anglo American in the diamond division, ending up 1990 to 1997 with worldwide responsibility for diamond exploration and evaluation. He was a consultant to De Beers from 1997 to 2002.

John Teeling, Chairman of African diamonds plc, commented:

'This is a very welcome development. Despite the current economic turmoil and the depressed market, the future of diamonds is bright. Supplies are scarce. Botswana is the pre-eminent source of gem quality diamonds. African Diamonds has been exploring kimberlites in the Orapa area with discoveries at AK8 and AK9, and positive indicators in other areas. The renewal of the licences gives us time to evaluate the technical and economic potential of our discoveries'.    

Further information:

www.afdiamonds.com