Figure 3: Locality plan of the Silverstreams, Uitdraai, Mushoek and De Kalk project areas

Figure 4: Silverstreams primary gravel thickness and overburden thickness contours

Figure 5: Uitdraai diamond project - primary gravel thickness and overburden contour plan

Silverstreams is the most advanced of the Company's alluvial diamond projects with trial mining well under way. Exploration of the project's kimberlite potential is at a very early stage.

The Silverstreams alluvial diamond project covers 3,589 hectares and is located on the northern bank of the Orange River some 14 kilometres from the town of Prieska. Prior to 2004, test mining by a previous company recovered good-quality alluvial diamonds from the primary and Rooikoppie gravels. Among the stones recovered were three large stones weighing 65.8, 50.1 and 28.8 cts respectively. In total, 64 000 tonnes of gravel were processed, yielding 81 diamonds and a total of 280.04 cts. The average recovery grade was 0.44 cpht, with an average stone size of 3.95 cts. An average selling price of US$ 2019/ct was obtained.

Subsequent exploration resulted in an inferred diamond resource estimate, the details of which are set out in the technical reports on the company's South African projects. See the "Technical Info" part of this website for a copy of this report.

Bulk sampling operations have begun at Silverstreams with all plant and equipment having been commissioned. The equipment has a front-end gravel-treatment capacity of 160 tph. Trial mining started in July 2007 to process an eventual initial 70,000 cubic metres of primary gravel and 5,000 cubic metres of Rooikoppie gravel. The three largest diamonds recovered to date include 24.7, 23.6 and 10.8 carat stones.

Several trenches spanning the channel feature have been excavated. The Company has created the necessary infrastructure and lodged the requisite deposits and electricity connection fees with Eskom, with power to be provided in January 2008. At present power is being provided by generators at a premium to the Eskom rate and at an additional cost to the Company. This remains the final obstacle to optimizing the rate of feed to the recovery plant.