Teeling :- The master of the Resource Stock ? And next weeks winner is....

African Diamonds says Botswana jv with De Beers could be a 'company maker'

LONDON (AFX) - African Diamonds PLC said its joint venture, in Botswana with
De Beers, shows every indication of being "a company maker" for African
Diamonds.
In a statement alongside results for the year to June 30 2005, the group
said the AK6 discovery near Orapa, contributed by De Beers to the joint venture,
is a large pipe with good grades and good quality stones. The discovery is on
track to be declared commercial in the next year.
Current tonnage estimates are 54 mln tons of kimberlite and African Diamonds
said that, if the previously announced grades of 25 carats per hundred tons
(cpht) are maintained and if the values of 138 usd per carat are maintained then
a 5 mln ton a year mine producing in excess of 1 million carats with revenues of
150 mln usd is possible.
De Beers is proposing to spend over 20 mln usd on AK6 in 2006. There is no
cost to African Diamonds.
African Diamonds' results for the year showed a pretax loss of 260,887 stg
compared with a loss of 222,104 stg a year earlier.
The group said that in addition to the joint venture with AK6, it is hopeful
of other discoveries, in particular kimberlite AK8 has potential.
The group said it also has other interesting projects in Botswana.
Kimberlite AK12 is a good size with interesting geology and is currently
being drilled.
BK11 estimated at 6.5 hectares has been drilled. The group said results were
mixed but more work needs to be done.
It also said its 100 pct owned Botswana licence, Mmashoro, shows promise and
needs to be drilled.
African Diamonds said there are more opportunities in Botswana which will be
looked at in the coming year.
The main outlay in the coming year is in Botswana where De Beers will spend
in excess of 22 mln usd on joint licences. The group said it will spend nothing
on these.
The group also said its wholly owned operation in Botswana is expected to
expand but it will be low cost. Development proposals on Plant 11 undersize
dump and the dykes in Sierra Leone are likely but they may very well be in joint
venture, so reducing capital cost. African Diamonds said it has offers of
capital from numerous sources.
Chairman John Teeling concluded: "African Diamonds is facing a very bright
future. Beginning in early 2006 the likely development path for AK6 will
unfold. We are in the right place at the right time with the right partner."
newsdesk@afxnews.com