KimCor Diamonds plc - Operations Update

RNS Number:0582S
KimCor Diamonds plc
01 March 2007


                                                                    1 MARCH 2007

                               KIMCOR DIAMONDS PLC
                                   (AIM: KIM)

                               Operations Update


KimCor Diamonds plc ('KimCor' or the 'Company'), the AIM listed diamond
producing and exploration company with properties in South Africa, is pleased to
provide the market with an operations update.

Highlights:

   *Agreement signed with a neighbouring mining company, for the provision of
water at no ongoing cost;
   *The provision of additional water will allow KimCor to run the Bellsbank
plant at or above its design rate of 60,000 tonnes per month of tailing
material; and
   *A new conveyor system is expected to significantly reduce the cost of
tailings disposal.

Free State Diamond Mines (Pty) Limited ('FSDM'), a wholly-owned subsidiary of
the Company, has entered into an agreement with a neighbouring mine for the
provision of water to enhance production rates and diamond recoveries at its
Bellsbank operation. Under the terms of the agreement, FSDM has been granted
access to the mine for the installation, maintenance and operation of a pumping
system to collect water delivered to surface and for the transfer of this water,
through a pipeline constructed, maintained and operated by FSDM.

Although the neighbouring mine operation has not guaranteed that water volumes
available to FSDM will remain constant, it is currently producing unused water
at over twice the rate that the Bellsbank plant requires to run at capacity.

In addition, the Company intends to construct a conveyor system to remove waste
tailing material from the Bellsbank plant, replacing the need for the engagement
of a mining contractor to haul waste to a tailing dump facility. The new
conveyor system will significantly reduce the cost per tonne of tailing
disposal.

The water infrastructure and conveyor system at Bellsbank are expected to be
completed within 2 months of the date of this announcement.

The Company is confident that the new water and tailings disposal systems will
allow the Bellsbank plant to operate at or above its design rate. The Board is
further evaluating the operating procedures at Bellsbank and expects to release
a trading update in due course following completion of the capital projects
described in this announcement.


Enquiries:

KimCor Diamonds plc                                           Tel: 020 7290 1400
Martyn Churchouse

Strand Partners Limited                                       Tel: 020 7409 3494
Simon Raggett
Warren Pearce
Victoria Milne-Taylor

Bishopsgate Communications Ltd                                Tel: 020 7562 3350
Maxine Barnes
Nick Rome


                      This information is provided by RNS
            The company news service from the London Stock Exchange

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