RNS Number:7203U
Reefton Mining N.L.
28 January 2004



Reefton Mining N.L ("Reefton" or "The Company")

28 January 2004

QUARTERLY ACTIVITIES REPORT FOR THE PERIOD ENDED 31 DECEMBER 2003

                                 HIGHLIGHTS

                            SKELETON COAST DIAMONDS

Namibia

   * Beaches continue to yield diamonds as exploration advances for a further
    22 kilometres northwards.

   * 45 kilometres of diamondiferous beaches established.

   * Sampling has recovered 590 diamonds for 141.75 carats. The diamonds are
    of exceptionally high quality. Largest recovered is 2.3 carats.

   * Bulk sampling returned grades of;

2.11, 2.16, 2.37, 2.66, 3.54, 3.72, and 15.22 carats per hundred tonnes (cpht).

   * Reconnaisance samples returned up to 5.26 cpht.
   * Four beach gravel series have been identified along the coast;

o The Modern Beach -- sampling returned a diamond grade of 12.96 cpht,
o The 10 Metre Beach series - extensively developed along the coast, with grades 
  of up to 15.22 cpht.
o The 30 Metre Beach series - returned diamonds up to 1.6 carats in size,
o A fourth series between 50 and 90 metres elevation are yet to be tested.
* Finalised agreement to acquire 80% of a further concession covering 90 
  kilometres of coastline.

SKELETON COAST DIAMOND PROJECT - NAMIBIA

Exploration
For the field period ending in mid December, all of the sites sampled returned
diamonds with a recovery of 327 diamonds for 79.98 carats. The total diamond
recovery to date is 590 diamonds for 141.75 carats. The diamonds are of
exceptional high quality, clarity, colour and crystal shapes, ranging up to 2.3
carats in size, and averaging 0.24 carats.

The on going programme of exploration and bulk sampling has now extended the
presence of known diamondiferous modern and fossil beach gravels to over 45
kilometres of the Company's concessions. The concession area has been divided
into sectors (see attached map) based on the rivers and landforms which affected
the deposition of the gravels.

Landsat image interpretation and air photograph studies of the concessions
indicate that the same gravel beaches as those at Mowe Bay, persist in Reefton's
concessions for a further 200 kilometres to the north of Mowe Bay toward the
Angolan border.

Based upon the results received to date, there is every expectation that the
gravel beaches are diamondiferous throughout Reefton's concessions. Recorded
diamond production from old prospecting sites to the north at Rocky Point,
Sarusas and Cape Fria, and to the south at Henties Bay support this.

Mowe Bay Sector

Diamonds have been recovered over a length of 22 kilometres in this sector (see
map). The beach gravels are estimated to exceed 15,000,000 tonnes.

Four beach series have been determined of which three have been tested by
drilling, trenching and sampling.

1. The Modern Beach -- The dynamic marine processes are still actively
depositing and concentrating diamonds in the concession areas. Preliminary
sampling returned 7 diamonds totaling 1.4 carats representing a grade of 12.96
carats per hundred tonnes from a 10.8 tonne sample.

2. The 10 Metre Beach Series - This well preserved extensive gravel beach is a
focus of the programme, and contains up to five (5) individual gravel beaches.
The individual beaches are inter-layered and overlap one another from 5 to 12
metres in elevation above sea level (collectively termed the 10 Metre Beach
Series). The beach series is up to 500 metres in width and sampling has returned
grades of up to 15.22 carats per hundred tonnes.

Segments of this beach in the Mowe Bay Sector were selected as target areas for
bulk sampling. They are each located up to 10 kilometres apart. The intervening
areas contain continuous gravel, thin sand cover or erosion surfaces and
exploration will continue to infill between the target resource areas.

Westies Area - The largest diamond was 2.3 carats. Grades of 2.16 cpht (360
tonne sample), 2.66 cpht (360 tonne sample), 3.72 (18 tonne sample)and 15.22
cpht (62.5 tonne sample) have been returned.

T15 Area - Located 10 kilometres south of Westies the 10 metre beach series is
well preserved in this locality and is 200 to 500 metres wide. The fossil
beaches continue for at least three kilometres to the south and 5 kilometres to
the north. Samples returned 22 diamonds for 7.34 carats averaging 0.33 carats. A
16.9 tonne sample returned 2.37 cpht.

T21 Area - Located 10 kilometres to the north of Westies, 37 diamonds totalling
8.465 carats, have been recovered from preliminary sampling of this 10 metre
beach series. Grades returned were 3.54 cpht (80 tonne sample) and 2.11 cpht (18
tonne sample). The extensions of these gravels are concealed by shallow dune
sand and deposits of the Hoarusib River.

3.       The 30 Metre Beach Series -- comprises at least three (3) inter-layered
beaches from 20 to 30 metres in elevation (collectively termed 30 Metre Beach
Series) over a width of up to 400 metres. It is located 1.5 to 2 kilometres
inland from the existing shoreline. Preliminary sampling has returned 9 diamonds
for 4.27 carats averaging 0.47 carats. A 36 tonne sample returned a grade of
5.26 cpht with the largest diamond of 1.6 carats in size.

4.       The fourth beach series is the oldest and is located further inland
from the Namibian coast beneath shallow wind blown sand. This series of beach
gravels occurs along the continental cliff line from 50 to 90 metres elevation
in Reefton's concessions.

The samples recovered from trenches were screened at 2mm to 14mm. The product
was scrubbed through a wet trommel before processing through the 10 tonne per
hour Dense Media Separation (DMS) plant utilising ferro-silicon as the media.

Rocky Bay Sector

Exploration commenced advancing 22 kilometres further north into the Rocky Point
Sector (see map) and reconnaissance samples returned immediate positve results
from small samples. This sector contains similar beach deposits to the Mowe Bay
Sector and is estimated to contain in excess of 10,000,000 tonnes of gravel.

T206 Area - Area T206, contains four parallel north-south trenching fossil
beaches. All of the beaches contain high percentages of gravel and large
boulders, indicating a high energy environment where a greater concentration of
diamonds is expected. Samples returned grades of up to 0.87 cpht (37.4 tonne
sample).

T208 Area - T208, located another 3 kilometres to the north, comprises a large
number of preserved fossil beach ridges. The lower section of the two metre
thick gravels is similar to T206. The quantity of diamonds is yet to be
determined for this area with bulk samples awaiting processing.

Regional geology of the diamond deposits of the west coast of Africa
The same diamondiferous beach gravels occur from the border of Angola in the
north, through Diamond Area 1&2 in Namibia, and Namaqualand (South Africa) to
the Oliphants River in the south, a distance of almost 2000 kilometres. These
beach gravels have been mined on a vast scale since the discovery of their
diamond content in 1908. The source of the diamonds spread over this highly
prospective coast line is the remarkably rich diamondiferous interior of
southern Africa. Many large modern and fossil river systems drained vast areas
of the interior containing diamoniferous kimberlite rocks, transporting the
diamonds thousands of kilometres to the ocean where marine processes
concentrated the gravels.

Acquisition of EPL 2742 - Kunene River, Skeleton Coast, Namibia

The company finalised an agreement to acquire an 80% interest in EPL 2742. This
concession adjoins the company's existing concessions, to the north, bringing
the total coverage of the diamond bearing beach deposits held by the company to
310 kilometres.

Further to the north in Angola, a corridor of diamondiferous kimberlites trend
south east into this concession area. This corridor contains kimberlites and
extensive rich alluvial diamond deposits.

X-Ray diamond Sorter
A new FlowSort diamond sorter has been purchased in South Africa and will be
delivered by early February 2004. These robust compact units are based on
leading edge technology ideal for the coastal environment. They have been
produced in Africa for over 10 years. This acquisition will remedy a constraint
in the bulk sample process system and allow a vast improvement in the speed of
processing concentrate and obtaining results of diamond content.

Corporate Developments
During the quarter the Company appointed Grant Thornton UK as its new AIM
Nominated Advisor. In addition the Company also appointed Hoodless Brennan and
Partners Plc - London as its new AIM Broker and placed 11,021,815 ordinary
shares to Hoodless Brennan to raise #205,436 (A$514,292)in working capital.

This report accurately reflects information compiled by Mr G.R. Hemming,
MAusIMM.,MAIG., a Director of Roscoria Pty Ltd, who is a competent person as
defined by the Australasian Code for Reporting of Identified Minerals Resources
and Ore Reserves and accurately reflects the information compiled by the
competent person.




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