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West African Diamond - Interim Results

RNS Number:4118M West African Diamonds PLC 24 January 2008 24th January 2008 WEST AFRICAN DIAMONDS PLC INTERIM RESULTS West African Diamonds ('WAD'), the diamond and gold producing, exploration and development company today announces its interim results for the six months ended 31 October 2007. > First production of diamonds and gold from Plant 11, Sierra Leone. > Cash flow from sales of diamonds and gold booked for February 2008. > Continuing good diamond recoveries on the Bomboko; with large stones and over 200 carats recovered. > Pipe 3 in Sierra Leone has been expanded and a satellite kimberlite discovered. > Gold exploration commenced in the Nimini Hills Greenstone Belt (Sierra Leone). James Campbell, Deputy Chairman of WAD commented: 'This has been a transformational period for WAD. We have created a gold and diamond mine in Sierra Leone and have now commenced production. This producing resource base will provide cash flow to drive our other exciting development and exploration projects in Sierra Leone and Guinea. We look forward to the future with confidence. With an impressive resource base in the ground and exciting possibilities moving forwards, WAD could become the investment of choice in the region.' Enquiries: West African Diamonds John Teeling, Chairman + 353 1 8332833 James Campbell, Deputy Chairman +27 83 457 3724 Blue Oar Securities Plc John Wakefield +44 (0) 117 933 0020 Simon Moynagh College Hill Paddy Blewer +44 (0) 20 7457 2020 Nick Elwes www.westafdiamonds.com Chairman's Statement - West African Diamonds - Interim Results for the Six Months Ended 31 October 2007 I am pleased to report significant progress on a number of projects. We have an exciting portfolio ranging from gold and diamond production to early stage exploration. West African Diamonds ('WAD') is one of the few diamond producers listed on the stock exchange. It is a tribute to our executives that the Plant 11 project was taken from design to production in twelve months. Plant 11 Mine, Koidu, Sierra Leone (60% WAD): Gold and diamond production has commenced on this approximately 7M tonne plus deposit. The plant has been commissioned at its nameplate capacity of 150 tonnes per hour and is currently operating on an extended day shift basis. Output is expected to be approximately 0.4g/t gold worth $9 a tonne of ore and diamonds worth $3 a tonne of ore. Gold pours have already taken place and in excess of 4,580 diamonds (285 carats) have been recovered from the 20,644 tonnes of material treated in the first month of production (mid December 2007 to mid January 2008). A batch treatment process to recover the larger diamonds has been devised and is currently being implemented. Gold and diamond contracts are in place and the first sales will take place in Q1 2008. Bulk sampling is planned on the Plant 6 oversize and undersize tailings deposits, which were recently acquired from Fastrack. Bomboko Alluvials, Guinea (100% WAD): Four large diamonds (9.2, 4.5, 4.2 and 3.8 carats) and over 200 carats have been recovered from the ongoing bulk sampling of this estimated 750,000 carat alluvial diamond deposit. Equipment is being refurbished and other pieces acquired to begin small scale mining on the Bomboko. The first sale of diamonds from Guinea is expected during Q1 2008. Pipe 3, Sierra Leone (100% WAD): Pipe 3 in Koidu is located adjacent to the Koidu Holdings mine or Pipes 1 and 2. From a kimberlite pipe with very limited economic value, WAD has increased the recoverable grade almost fourfold from 5 to 19 carats per hundred tonnes (cpht) by the application of modern Dense Media Separation ('DMS') technology and appropriate process controls. A recent geophysical survey, undertaken by a specialist Canadian firm, has postulated a doubling of the size of the available kimberlite, with the discovery of a satellite kimberlite very close by to Pipe 3. Approximate calculations suggest a target mineable deposit of 350,000 tonnes grading up to 19 cpht and in excess of $228 per carat. The pipes are part of a kimberlite dyke system. WAD has sampled and mapped a 14km strike length going through Pipe 3. Economic options are currently being assessed. Droujba, Guinea (100% WAD): This is an area of Guinea well known for diamonds contained in alluvials, kimberlite dykes and pipes. WAD obtained a licence over the area in April 2007 and has reviewed all available data. There is significant short term potential in the alluvials, while the geology and economics of the kimberlite dykes and pipes need to be assessed. A comprehensive ground geophysical survey, using four technologies (magnetics, HLEM, gravity and AMT) over the Droujba kimberlite and surrounding dykes was completed in Q4 2007 by a specialist South African firm and the data is currently in the process of being interpreted. This will supplement an earlier independent assessment of the Droujba alluvials, which highlighted an exploration potential of between 300,000 and 500,000 carats. Exploration, Nimini Hills Sierra Leone (100% WAD): Early reconnaissance sampling for gold in the Nimini Hills of Sierra Leone included encouraging results of 63 and 73g/t. Follow-up sampling is in an advanced stage of planning in an attempt to discover shear hosted hydrothermal gold mineralised systems. Future: WAD has significant potential. The company is a diamond and gold producer with a portfolio of projects spanning the full development horizon; from early stage exploration to production and sales. There is an experienced team in place, more than capable of developing the portfolio. We are constantly evaluating new projects in diamonds and in metals, not only in West Africa but elsewhere in Africa, as we are always looking to add value to our portfolio; through acquisition and by monetising our asset base through development. We are well on the way towards realising the potential of our assets. John Teeling Chairman 24th January 2008 Financial Information (unaudited) Six Months Ended 31 Oct 07 31 Oct 06 #'000 #'000 Group Profit and Loss Turnover 0 0 Operating Costs (146) (148) --------- --------- Operating Loss (146) (148) Interest Receivable 7 0 --------- --------- Loss before Taxation (139) (148) Taxation 0 0 --------- --------- Loss for the period (139) (148) ========== ========== Loss per share (0.39p) (0.74p) ========== ========== 31 Oct 07 31 Oct 06 #'000 #'000 Group Balance Sheet Fixed Assets 7,058 4,455 --------- --------- Current Assets 778 12 Current Liabilities (211) (391) --------- --------- Current Assets less Current Liabilities 567 (379) Creditors (amounts falling due after one year) 0 0 --------- --------- Total Assets less Liabilities 7,625 4,076 ========== ========== Share Capital and Reserves 7,625 4,076 ========== ========== 31 Oct 07 31 Oct 06 #'000 #'000 Group Cash Flow Operating Loss (146) (148) Movements in Working Capital 278 173 Net Cash Inflow from Operating Activities 132 25 Returns on Investments and Servicing of Finance 7 0 Capital Expenditure (1,358) (25) Financing - Issue of Ordinary Share Capital 1,400 0 --------- --------- Increase in Cash 181 0 ========== ========== Notes: 1. The figures for the six months to October 31 2007 and October 31 2006 are unaudited. The financial information set out above does not constitute fully statutory accounts within the meaning of Section 240 of the Companies Act 1985. 2. The interim unaudited results have been prepared on a going concern basis and in accordance with International Financial Reporting Standards. 3. Copies of this announcement will be sent to shareholders and will be available for inspection at the Company's Registered Office at 20-22 Bedford Row, London WC1R 4JS. This information is provided by RNS The company news service from the London Stock Exchange END IR QXLFLVFBLBBV

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