WH Ireland published a note on these last week which I think is a bit pie in the sky but it was worth a look and bought on pure gamble

AFRICAN DIAMONDS (Sierra Leone visited, interests also in Botswana and Guinea)
Sierra Leone used to be described as "the Athens of Africa" due to the attractiveness, intelligence, high education, peacefulness and excellent manners of its people. Extraordinarily, despite eleven years of Liberian-instigated civil war (with grievous damage to people and infrastructure), these personal qualities
remain very largely intact. Thanks to the intervention of British troops the war ended in early 2002. The United Nations, in the form of Nigerian troops, had previously only added to the plunder. Excellent Ministry of Mineral Resources - right down the line. Guinea is a stable democracy based on the French government
and legal systems - also a cultivated people. Botswana rates as Africa's no.1 success story.

Code Price* Shares in issue Market cap Listed
AFD 7p 54.7m ords 3.8m AIM
Key points

African Diamonds holds two interesting Exclusive Prospecting Licences (EPL's) and one very prospective Exclusive Exploration Licence (EXPL) near the town of Koidu in Sierra Leone's main diamond district of Kono. These cover 404 sq kms. It also has three EXPL's in Guinea amounting to 236 sq kms - also of great interest. Finally, it has three EPL's in Botswana (via wholly owned Kukama) amounting to 1,350 sq kms - one of which is partly contiguous with De Beers big Orapa mine and contains 21 known kimberlites.
Early work on the other two Botswana EPL's has proved highly encouraging.

Of very great interest is EXPL 8/2002 in Sierra Leone hosting the known kimberlite Pipe 3, along with several kimberlite dykes. Diamonds of good quality and high yield have been found. A tentative valuation of this area alone, subject to continued good results, is US$80m/50m before deducting any minorities. Assuming 25% local interest, this would net down to 37m or 68p a share.

The two EPL's in Sierra Leone represent very good kimberlite targets, along with remnant alluvial terraces.
These two properties are at the grass roots stage but exploration is expected to yield good results.
In Guinea the work is generally at more of a grass roots stage than in Sierra Leone but the prospects for fairly early returns are there. The country is under-explored for diamonds, though they are the second largest export after bauxite. De Beers has taken out 22 licences in the country.

In Botswana the three licence areas are all highly prospective-largely for kimberlites

The company was formed in 2000 and listed on AIM on 14 July 2003-raising 800,000 or 659,000 net of expenses. There is a small amount of cash from prior fundraising so cash on hand is circa 700,000.

The company has a very interesting mix of kimberlite, kimberlite dyke and alluvial prospects which, though somewhat speculative, are tentatively valued around US$80m/50m or 91p a share. Substantially undervalued

African Diamonds PLC
15 December 2003

FIRST DIAMOND FOUND IN ORAPA KIMBERLITE DRILLING

African Diamonds is pleased to announce the discovery of a diamond from our
kimberlite drilling program in the Orapa area of Botswana.

Onsite analysis from drill hole 6 on kimberlite BK10 discovered a good quality
0.11 carat stone. Analysis of the remaining 14 drill holes continuing using an
onsite jig plant. All of the concentrates from the jig will be sent to a South
African facility for processing through an X ray diamond recovery plant.

John Teeling, chairman of African Diamonds commented:

'This is great news. It is every explorers dream to find what you are looking
for. Do not underestimate what has occurred. For 2000 million years this small
piece of carbon sat undisturbed. A small drilling team, working in an extreme
climate, using a drill hole only a few inches in diameter, found this diamond.

This diamond is small but where there is one there are more. This discovery
confirms our belief that the Orapa licence offers every hope of generating a
viable diamond mine. Remember we need only 10 carats equal to 2 grams of gem
quality diamonds per 100 tons of rock to be commercial'.


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

LONDON (AFX) - African Diamonds PLC said it discovered a second diamond
today on kimberlite pipe BK10 in the Orapa area of Botswana.
The diamond, a white 0.14 carat stone, was discovered in drill hole 7 and a
further 13 holes remain to be analysed, it said.
Earlier today, the group said it discovered its first "good" quality 0.11
carat stone.
newsdesk@afxnews.com
shw

Very upbeat prelims

Timing is everything. As I sat down to write this statement, I received a phone
call from the Kalahari desert in Botswana. The type of phone call every explorer
likes to receive. We had found a diamond. Onsite analysis of one of the drill
holes on our BK10 kimberlite pipe on our Orapa licence had recovered a diamond.
Not large, 0.11 carat, but good quality. It is almost impossible to overstate
the importance of this discovery.

Finding diamonds is like finding a needle in a field of hay, not a haystack. As
luck would have it, as we were preparing the final draft of this statement, I
got word of a second discovery. A white 0.14 carat high quality stone found in
drill hole number 7 on BK10. Futher analysis revealed this stone to be a
fragment of a larger diamond yet to be recovered.

These small pieces of two thousand million year old carbon may transform our
company. They are unlikely to exist in isolation. We have more drill samples to
analyse on site, over 100 tons, then we ship the concentrate to South Africa for
detailed x-ray diamond equipment analysis. We estimate that a viable small
diamond mine on the Orapa licence requires 10 carats per hundred tons of rock.
That is, we can commercially mine 100 tons of rock to recover 2 grams, or 1/15
of an oz of gem quality diamonds.

The discovery of our first diamond from hard rock drilling is only one in a
series of important events impacting on our company. Over the coming months I
expect to report on a series of activities any or all of which can have a
favourable impact. In summary these events are:

In Botswana;
- further drilling results from Orapa,
- detailed results from the Serowe alluvial drilling,
- developments on our brand new 999 km sq Orapa licence,
- additional high quality prospecting licences,
- listing on the Botswana Stock Exchange.

In Sierra Leone;
- the start up of our pilot plant on the Pipe 3 kimberlite in Koidu,
- results from our kimberlite dyke sampling on our prospecting licences.

In Lesotho;
- commissioning of our 55 percent owned pilot plant at Kolo.


In Guinea;
- results from structured pit sampling on our three alluvial licences. To date
20 diamonds weighing 13.60 carats have been recovered.

We established the company in 2001 with a clear mission - to become a gem
quality diamond miner within 3 years. Success in exploration requires four
ingredients - good ground, good people, money and good luck. Africa was, and is,
the home of diamonds. In Africa, Botswana and Sierra Leone together, are the
main source of gem quality large carat diamonds. Within these countries, two
areas stand out a mile - Orapa in Botswana and Koidu in Sierra Leone. We were
fortunate to be offered quality licences in both Orapa and Koidu. With this
ground came highly experienced people, men who are now substantial shareholders
in African Diamonds. In Botswana, we have Leon Daniels and Mark Scowcroft. Each
vastly experienced in the country. Similarly in Sierra Leone, Jim MacGregor and
Alieu Mahdi, each with decades of experience, oversee operations.

Money came initially from loyal investors who have supported us through the lean
years in resource shares and, latterly, from our listing on the AIM market in
London. All business ventures require luck, none more so than exploration. To
date, things have gone well.

The Review of Operations below gives details on the many projects currently
underway. I can only give a flavour of our activities in this report. Our
activities in the Orapa area of Botswana deserve particular attention. We are
now one of the largest ground holders in the area. As De Beers have been forced
to give up ground, we have moved in. We have already identified numerous
kimberlite pipes and we believe that the new licence covering 999 sq kms holds
more undiscovered pipes. Work on our Serowe licence is fascinating, high
potential and high risk. The Orapa kimberlite field is 90 million years old.
Over the years erosion has taken away up to 100 metres of the pipes. No one has
yet discovered where the eroded material has gone. Leon Daniels believes that
the drainage, for at least part of the 90 million years, was in rivers flowing
South East, an area now covered by the 2 million year old Kalahari desert. Using
Landsat imagery, geophysical techniques and by drilling 42 holes, we are looking
for an ancient dry river channel. We believe we have found it and we are
currently analysing samples from the old riverbed to identify their origin. The
next step is to drill around the dolerite dykes, which cross our ground looking
for plunge pools, which may contain diamonds. If we are lucky, that word again,
we may find large gem quality diamonds.

It may be hard to believe that the further diamonds travel in a river, the
bigger and better they get - flawed diamonds are brittle and fracture. In recent
days we have received further support for our exploration model on Serowe. In
South Africa, a similar exploration effort to find alluvial diamonds in long
lost riverbeds, found a 0.36 carat gem quality diamond. Our extensive quality
ground in Botswana is attracting interest from potential partners. I hope to be
able to announce something in the coming months. Pipe 3 in Koidu, Sierra Leone,
may be our first mine. This highly sought after ground is adjacent to the new
Diamondsworks mine on Pipes 1 and 2, which was commissioned in December 2003. We
have dewatered the pipe, prepared foundations and ramps and we are refurbishing
a plant for commissioning on site in early 2004. We will run a bulk sample of
5,000 tons of material. The pipe was never commercially mined but there have
been extensive artisan workings. Anecdotal evidence suggests that the 970 carat
Star of Sierra Leone was found in the area. Assuming we recover commercial
grades of diamonds, we will immediately apply for a mining licence. Our work on
the kimberlite dykes on the licences surrounding Pipe 3 is producing excellent
results. Seven dyke zones have been mapped over a total of 11,119 metres.
Mapping will be completed in the coming months and will be followed by a
bulk-sampling program. Work done in the 1960's by the Sierra Leone National
Diamond Corporation found all of the dykes contained diamonds at grades which
are commercial at 2003 prices. The Kolo project in Lesotho is a question of
being in the right place at the right time. Reserves on the Kolo property are
estimated at 342,000 carats of good quality large stones. The concession holder
was unable to complete construction of a 40 ton per hour capacity mine. We
agreed to refurbish and commission the project for a 55% interest. We await
Lesotho state approval before undertaking the work, which should take only 8
weeks to complete. We will process 30,000 tons with the expectation of
recovering 5,000 carats. If this is true we will continue to mine, if not we
withdraw. Lesotho is a sovereign country surrounded by South Africa. It had a
strong diamond mining tradition, which almost died in recent years. There is now
a significant upsurge in interest. Mines are opening at Letseng and Kao while
European Diamonds have recently bought into Liquobong. Guinea is estimated to
have 20 million carats of diamond reserves. As an early entrant, African
Diamonds obtained 3 licences, all of which have artisan workings. On Seria and
the adjacent Bomboko licences, our sampling found 20 diamonds. We are
undertaking a detailed sampling operation on our large Fangamadou licence along
the banks of the river Meli. We are zoning in on four areas with thick gravels.


Finance

We raised 800,000 on our listing in July. This is not reflected in the balance
sheet which is dated June 30th 2003. This will cover our current expenditure
plans until mid 2004 by which time our projects will be at stages easier to
finance. Our initial shareholder base of 500 has almost doubled in the past four
months. We will list on the Botswana Stock Exchange in early 2004 - the first
junior diamond company to do so. Botswana is the world's largest diamond
producer by value. There is an investor base familiar with and knowledgeable on
diamonds.



Future



Finding a diamond on our Orapa licence was a vital step toward success. It
should be the first of many. Circumstances favour us. Diamond demand is strong,
gem quality diamond prices are rising, we have good ground and the stock market
is amenable to our story. Our results to date are more important than rising
prices or good demand. In Sierra Leone and Botswana we have results, which give
us a reasonable chance in the near future to become a gemstone quality diamond
miner.