European Diamonds Plc (EPD: AIM) is a diamond exploration and development company with advanced projects in Finland and Lesotho.

In Finland, the company has explored a large part of the prospective Karelian Craton and identifed a number of kimberlite indicator trains. Kimberlites have been discovered in one of these areas and exploration continues in the others. Evaluation work on the promising Lahtojoki Pipe has begun with a 5,000 tonne bulk sample due to be collected before Easter 2005.

In Lesotho, European Diamonds holds a 25 year mining license to develop the Liqhobong diamondiferous kimberlites. The Liqhobong Project provides for the commencement of mining at 290,000 carats per annum from the end of 2004 from the Satellite Pipe and the evaluation of the adjacent large Main Pipe and start of a Feasibility Study in 2005.

European Diamonds will become a mid-tier diamond producer in 2005 and intends to grow through acquisition and in-house exploration. The experienced management and technical team of European Diamonds have a strong track record of discovery and a history of wealth creation for shareholders.



The Kingdom of Lesotho gained its independence from the UK in 1966 and is the only constitutional monarchy on the African continent. The country is a small, densely populated mountainous country situated in the east of the Republic of South Africa, which entirely encircles the country.

Diamonds in Lesotho
The country has long been known as a source of large, high quality diamonds, mostly from alluvial deposits. To date most of the country's diamond production has been derived from the Letseng-la-Terai deposit which was mined by De Beers between 1977-1981. Letseng has recently returned into production and is again producing high quality gems albeit on a modest scale. Apart from Letseng, the only other known significantly mineralised kimberlites in the country are the Liqhobong suite and the nearby lower grade Kao pipe all located about 40 kilometres west of Letseng also high in the Maluti mountains.





Finland project.

Project Highlights
Work undertaken by European Diamonds and the Geological Survey of Finland has proven that the Achaean-aged Karelian Craton is highly prospective for hard-rock diamond deposits.
European Diamonds currently have seven regional exploration projects in eastern and central Finland in addition to the Lathojoki project currently under evaluation.
The Company has recovered high quality kimberlite indicator minerals from all of the exploration projects and will continue with the field exploration of these areas in 2005.
Work on the Lentiira Project in central eastern Finland has identified a large kimberlite complex covering an area of some 160 square kilometres. Although the Company has recovered high quality indicator minerals and diamonds from the project area, to date only linear kimberlite dykes have been discovered.
None of the sampled dykes has proved to be the source of the highest quality indicators emanating from the highly prospective 'Railway' indicator train. Further assessment of this project will continue throughout 2005.





Corporate website : http://www.europeandiamondsplc.com/s/Home.asp

Shareholder info : http://www.europeandiamondsplc.com/s/InformationRequest.asp

Coimment, click here

http://www.proactiveinvestors.co.uk/articles/art.php?EPD4

Last March, with the price at 16.5p mid, we thought that European Diamonds could well be on the cusp of a turnaround. The successful PFS and the excellent prospects going forward show that we were right.


Last Friday, European Diamonds called an EGM to change the company name to Kopane Diamond Developments plc. Kopane they explain - is a Sesotho word meaning "Unity". As the first corporate step towards the total repositioning of the company in the market, this comes as a clear clarion call that EPD's management remain determined to change public and market - perception of their company.

It was back in July when this move was first mooted, along with a significant reorganisation of the top echelon of management. Chairman Buddy Doyle reduced himself to the ranks of non-executive director, whilst Roy Spencer resigned as Chief Exec and also became a non-exec, though he did retain responsibility for the Finland operations. Newcomer Tim Read took the top job as Executive Chairman, and a new Chief Operating Officer was introduced in Stephen Lay. Read has years of experience of the mining industry, having served as CEO at Adastra from 1999 to 2006, after some years as co-head of mining investment at Merrill Lynch. Lay's 30 years of experience as a mining engineer and senior executive will stand him in good stead as he takes on the task of progressing the Main Pipe to full feasibility and production.




At the same time, they also announced that two key corporate actions were under active consideration the spinning off of the Finnish assets into a new company to be known as Northern European Diamonds, and a change in the name of the company to more accurately reflect the Lesotho focus. The spin off, it was clear, would take some time, as court approval would be required to reorganise the capital structure of the Finnish holding company, but the good news was that the shares in the new NED would be distributed to EPD shareholders by way of a dividend.

Still more good news included in that 18th July announcement was the upgrading of the Main Pipe resource and the completion of the Preliminary Feasibility Study, under the supervision of ACA Howe, for which shareholders had long been waiting.

To quote the company's own words on that day: The Company has completed its Main Pipe Pre-Feasibility Study ("PFS") which has generated the following technical and financial elements:
* Kimberlite resources modelled 55.5 million tonnes
* Proposed kimberlite processing rate 3.5 million tonnes per annum
* Initial mine life 16 years
* Provisional cost estimates: Capital US$100 million; Operating US$11 / tonne
* Indicated grade 27 carats / hundred tonnes
* Approximate recoverable carats 15 million carats
* Indicated run of mine value US$70 / carat
* Provisional value of recoverable diamonds US$1.05 billion

It's also worth noting two key comments from Howe, as follows: Howe considers that there may be significant revenue upside above this level because these numbers deliberately excluded several large or bonanza stones, including a 27.7 carat clean D flawless stone recovered from the Main Pipe bulk sampling in December 2006 that realised a price of US$27,000 per carat."

"Howe notes that an independent review and assessment of the macro-diamond size distribution of the Main Pipe based on the recent bulk sampling results by MM Oosterveld, has indicated that an average 200,000 tonnes of kimberlite would yield 4 stones larger than 50 carats and 1 stone larger than 100 carats."

So plenty of potential upside on the $70 per carat level, assessed and vouched for by a specialist organisation whose qualifications to make such an assessement are beyond doubt.



A resource statement issued just two months before, on 17 May, had valued the Main Pipe at a significantly lower level than this, based on available drilling/sampling results at the time. The May assessment prepared by expert diamond consultant Dr Leon Daniels - had covered a mix of indicated and inferred resources down to the 130m level of the pipe, coming up with 30.4 million tonnes at just under 28 cpht, equating to 8.44 million carats and thus valuing the resource at $591 million. This assessment had enabled a successful fund-raising during May and June at 20p, to put another 5.2 million in the bank.

So the July announcement was very good news all around. A new Chairman with some clout, a new COO who was a real mining engineer and not a geologist, a dividend for the shareholders in the fullness of time, and a value for Main Pipe almost 80% higher than just two months earlier.

Which makes it quite inexplicable that the share price, which had been in a gently rising trend from its earlier all time low in November 2006 almost immediately began to fall! Having reached 25p on the day of the announcement, the very next day saw a drop of over a penny, and apart from a couple of stabs at resistance, it has barely stopped since.

Today it stands at just 16.75p, when the company is probably in better shape than it has ever been, with a firm future, strengthened management and a completed PFS that leaves one in absolutely no doubt that the Main Pipe will be Lesotho's next diamond mine. Add to that the fact that the Satellite processing plant is now fully up to speed and churning out diamonds from both Satellite ore and Main samples, and the share price action seems even more strange.

To add to the upside, sales news released just two weeks ago showed that this summer's auctions in Antwerp have realised another $3.4 million in revenue, bringing the total so far to well over $9 million. Overall, run of mine stones are fetching almost $60 per carat average showing the influence of the lower grade Main Pipe samples on the total plant output. The price did try to rise when this news hit the market, but to no avail. It seems that investors really have fallen out of love with European Diamonds.

It has to be said that in the past the company has - justifiably - acquired a reputation for being a serial non-deliverer whilst raising funds from the market on a depressingly regular basis on decreasingly favourable terms.

But for the last twelve months, operations at the Liqhobong diamond project in Lesotho have progressed steadily, and the plant which serves the producing 69 cpht Satellite Pipe is now at full output, handling both ore from Satellite and bulk samples from the Main Pipe. Main Pipe is under continuing development to arrive at the final full feasibility study and commence production in 2009.

Last March, with the price at 16.5p mid, we thought that European Diamonds could well be on the cusp, and that the problems of the past were over and done with and the company could begin the task of turnaround. Their work of this last Spring and Summer, the successful PFS and the excellent prospects going forward show that we were right. Sadly, the market doesn't agree with us.

But with luck and a following wind not to mention shareholder unity at the upcoming EGM Kopane Diamond Developments might get a different reception.

Di
You still in these? Sold out at 50% loss in Jan 06. Not regretted since. However, maybe this time they could be on their way. Will watch and wait for some seriouos price/volume action, breaking back up through 20p.
sd

SD,

I think I must have bought EPD at a much lower price and certainly more recently as I am just below the price I bought and waiting ;-)
DI

an interesting interview with Tim Read, Ex Chairman of EPD and Wall Street Reporter
www.wallstreetreporter.com/page.php?page=featured&tab=2&id=27213

Kopane are presenting in London on Monday 26th November @ 18:00.

Registration details click HERE

Other companies presenting are Weatherly (WTI) and Central China Gold (GGG)

Proactive Investors One2One Forums

Monday 26th November 2007

Each company will present for 20 minutes with 10 minutes Q&A to follow. After the presentations are complete the directors will be available to take questions during a free canapand wine reception which will be open until 9pm

5:45pm for a prompt 6:00pm start at the Chesterfield Mayfair Hotel 35 Charles Street, Mayfair, W1J 5EB

Nearest tube station is Green PARK

proactiveinvestors.com have written an in depth article on KDD that should be very interesting to holders and watchers alike!

Click HERE