October 2, 2012

Encouraging Microdiamond Results from Katcha Kimberlite in Guinea

2 October 2012

AIM: STEL

Stellar Diamonds plc

(“Stellar” or the “Company”)

Encouraging Microdiamond Results from Katcha Kimberlite in Guinea

Stellar Diamonds plc, the London listed (AIM: STEL) diamond development company focused on West Africa, provides the microdiamond results from drilling and bulk sampling conducted on the 5km long Katcha kimberlite dyke, which forms part of the Droujba kimberlite project in Guinea.

Highlights:

  • 970 diamonds recovered from 199kg of kimberlite material from drilling and bulk sampling
  • 20 diamonds of commercial size greater than 0.85mm recovered
  • Grade forecast to be undertaken incorporating recent high grade bulk sample results
  • Adjacent to the Company’s 2.5 million carat Droujba kimberlite pipe deposit

Chief Executive Karl Smithson commented:

“The abundance of micro and macro diamonds in drill and bulk samples submitted and particularly the presence of twenty diamonds in the commercial size fractions confirm that the Katcha kimberlite dyke has the potential to be significantly diamondiferous at depth. We recently announced a highly encouraging surface bulk sample grade of 161cpht from Katcha and these microdiamond results will be used to model the continuity of grade with depth of the kimberlite.

“The high grade and considerable 5km strike length of the Katcha dyke demonstrates its potential to add significantly to the already defined 2.5 million carat resource base from the adjacent Droujba kimberlite pipe. Whilst at a relatively earlier stage, we anticipate a small portion of the Katcha kimberlite to be brought into the global resource category for the Droujba project. The independent resource statement for Droujba is on track to be delivered during this quarter.”

Microdiamond Analysis Results

Two separate samples of the Katcha kimberlite dyke were submitted to the Saskatchewan Research Council laboratory in Canada (“SRC”) for microdiamond analysis. These comprised a 152.64kg (dry weight) sample from the Katcha Bulk Sample trench and a 46.22kg (dry weight) sample from a number of drill core samples of the Katcha Dyke. The objective of the microdiamond analysis is to establish the relationship between the microdiamond and macrodiamond populations and to enable the diamond grade to be forecast across the kimberlite resource.

A total of 970 diamonds larger than the 0.075mm sieve size were recovered from both samples, with twenty diamonds being larger than the 0.85mm sieve size and weighing 1.07 carat from the combined 199kg of kimberlite. The kimberlite samples yielded an average of 4.88 diamonds per kilogram of kimberlite.

The following table summarises the caustic fusion results from the Katcha kimberlite samples:

Number of Diamonds According to Sieve Size Fraction (mm)
Sample Kimberlite Sample +0.075 +0.106 +0.150 +0.212 +0.300 +0.425
Number Sample Weight (kg) -0.106 -0.150 -0.212 -0.300 -0.425 -0.600
GN04-2012-001 Trench 152.64 288 219 127 117 38 19
GN04-2012-02 Drill Core 46.22 36 37 21 10 7 1
Total 198.86 324 256 148 127 45 20
Number of Diamonds According to Sieve Size Fraction (mm)
Sample Kimberlite +0.600 +0.850 +1.180 +1.700 +2.36 +3.350 Total Carats
Number Sample -0.850 -1.180 -1.700 -2.36 -3.350 -4.75 Diamonds +0.85mm
GN04-2012-001 Trench 30 11 3 2 1 1 856 1.0104
GN04-2012-02 Drill Core 10 1 0 1 0 0 114 0.0599
Total 30 12 3 3 1 1 970 1.0703

SRC is an independent laboratory that is accredited by the Standards Council of Canada to the ISO/IEC Guide 25 standard for diamond recovery by caustic fusion.

Resource Statement

The current 2.5 million carat inferred resource statement for Droujba is in the process of independent revision to incorporate new bulk sampling results from the Droujba and Katcha kimberlites and is scheduled to be delivered during the fourth quarter of 2012.

In accordance with the AIM Rules for Companies, the information in this announcement has been reviewed by Karl Smithson, Chief Executive of Stellar, a qualified geologist and Fellow of the Institute of Materials, Metals, Mining, with 23 years’ experience.

About Stellar Diamonds plc

Stellar is a London (AIM: STEL) listed West African focussed diamond mining and exploration company which is advancing the Droujba kimberlite pipe in Guinea and the Tongo kimberlite dyke project in Sierra Leone, which combined have a JORC Compliant, inferred diamond resource of 3.1 million carats. The Company recently announced a dispute with the Ministry of Mines in Sierra Leone over its two Kono licences.

For further information please contact the following or visit the Company’s website at www.stellar-diamonds.com.

Stellar Diamonds plc

Karl Smithson,Chief ExecutiveTel: +44 (0) 20 7257 2930

Northland Capital Partners Limited

(Nominated Advisor and Broker)

Gavin Burnell, Edward Hutton Tel: +44 (0) 20 7796 8800

Daniel Stewart & Company plc

(Co-Broker)

Martin Lampshire, Antony Legge Tel: +44 (0) 20 7776 6550

Pelham Bell Pottinger

James MacFarlane, Joanna Boon Tel: +44 (0) 20 7861 3232