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TAW - Tawana - Mining Right granted over Kareevlei Wes Diamond Project

Release Date: 20/04/2007 08:45
Code(s): TAW
Wrap Text

TAW - Tawana - Mining Right granted over Kareevlei Wes Diamond Project Tawana Resources NL (Incorporated in Australia) (Registration number ACN 085 166 721) Share code on the JSE Limited: TAW & ISIN: AU000000TAW7 Share code on the Australian Stock Exchange Limited: TAW & ISIN: AU000000TAW7 ("Tawana" or "the Company") Kareevlei Wes Project Northern Cape Province, South Africa Key Points Mining Right Granted - Mining Right Granted over Kareevlei Wes diamond project - Trial mining to commence this quarter. - Tawana-owned Dense Media Separation plants being moved to site - Kimberlites known to be diamondiferous KAREEVLEI WES PROJECT, KIMBERLEY REGION, SOUTH AFRICA (74% owned and operated by Tawana; 26% Seven Falls) The Directors of Tawana are pleased to announce that a Mining Right has been granted by the South African Department of Minerals and Energy over the Kareevlei Wes diamond project, which is located 100km west of Kimberley. The Kareevlei Wes Project comprises a cluster of 5 kimberlitic pipes (KV1-KV5), which vary in surface area from 5.5 ha to less than 0.1 ha. Drilling to a depth of 100 meters showed that KV3 is 13Mt and KV2 is 2Mt. Background As a result of processing percussion and Bauer drill bulk samples during 2004/2005 the grade of KV1 and KV2 was estimated to be 8.57 cpht. Subsequent statistical analyses of the diamonds recovered from these two kimberlites suggested that the grade could be expected to be 11cpht if larger parcels of diamonds could be produced. Diamonds from KV1 and KV2 were valued in 2005 at US$110/ct, with the valuer predicting substantially higher values for larger parcels. This prediction was supported by subsequent statistical analysis of a parcel from the KV1 and KV2 kimberlites, which suggested that US$164/ct was a reasonable value estimate for diamonds from these kimberlites. Subsequently a parcel of 33.24ct of diamonds from KV3 was valued by Mr Gregory Katz (a Johannesburg based valuer) at US$170/ct. At the estimated operating cost of open pit kimberlite mining and processing in South Africa of US$7.53/t (2005 costs), the required breakeven grade at a diamond value of US$170 /ct is 4.43 cpht Program A trial mining and treatment operation will commence during this quarter, aimed at mining up to 20,000 tonnes from kimberlites KV1 and KV2. The Company`s two dense media separation plants will be used to treat the material mined by contractors. Key Tawana personnel are already in place to supervise this trial. Commenting on the grant of the Mining Right, Wolf Marx, Managing Director of Tawana said: "We have been looking forward to receiving approval for this project for some time, and we are delighted that the Department of Minerals and Energy now supports Tawana`s program. This is a significant milestone for Tawana and we look forward to commencing the trial program as soon as tenders for the mining are let. We are fortunate that we already own the processing plant needed for this operation and that we have qualified and experienced staff on site. The project will be administered by our General Manager South Africa, Craig Bailey, who is based at the Company`s local South African office." Mr. Marx concluded, "I am grateful to our BEE joint venture partners, Seven Falls, for their assistance in securing the Mining Right approval. I look forward to keeping shareholders advised of progress." Note: The Company considers that any tonnage and grade estimates reflected do not satisfy the definition of a Mineral Resource as set out in the JORC Code as insufficient work has been conducted to be able to determine the grade and tonnage of the deposit with greater accuracy. Further work may or may not establish a Mineral Resource on the property. Accordingly, the estimate of grade is made as provided by paragraph 18 of the JORC Code in relation to an exploration target or exploration potential. The diamonds were recovered from the minus 19mm plus 1.5mm fractions of kimberlite sampled by 2.5m diameter Bauer drill holes. The kimberlite material was processed in the Company`s DMS plant with diamond recovery by Flowsort x-ray plant and grease table. Contact: Wolf Marx Tel: +61 (0)3 98635222 Mob: +61 (0)428 398446 Email:wolf.marx@tawana.com.au This report is based on information compiled by Wolf Marx BSc, BA, FAusIMM, CPGeo, Managing Director of Tawana Resources NL. He has sufficient experience relevant to the style of mineralisation and types of deposits under consideration, and to the activities undertaken, to qualify as a competent person as defined in the 2004 edition of the "Australasian Code for the Reporting of Mineral Resources and Ore Reserves" All press releases and announcements may be inspected on the Company`s web site, namely: www.tawana.com.au 20 April 2007 Sponsor PricewaterhouseCoopers Corporate Finance (Pty) Ltd Date: 20/04/2007 08:45:04 Supplied by www.sharenet.co.za Produced by the JSE SENS Department.

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