Final Results - Year Ended 30 June 1999

Petra Diamonds Ld
15 December 1999

                             PETRA DIAMONDS LIMITED

                     PRELIMINARY RESULTS FOR THE YEAR ENDED
                                   30 JUNE 1999

Key Points:

- Alexkor Management Contract won

- Gold Fields of South Africa prospects acquired

- New concessions acquired in Namibia and Botswana

- Diamondiferous kimberlite under exploration at Syferfontein

- Successful fund-raising

Commenting  on these Preliminary Results, Adonis Pouroulis, Chairman  of  Petra,
said:

'These results cover a year of great difficulty for Petra, with the  escalation
of  hostilities  in  Angola unexpectedly preventing further development  of  our
great prospects in that country.

We have had to refocus our effort and re-finance our company to cope with  the
new operations.

The winning of the Alexkor Management Contract and the acquisition  of  various
prospecting rights  in South Africa, Botswana and Namibia  have  given us  new
opportunities,  while a successful fund-raising has placed us in  a  position 
to develop these opportunities.

We look forward with much confidence.'


CHAIRMAN'S STATEMENT

I  am  proud to present our second year of results. The year has been both  very
rewarding  and challenging. It has been rewarding in the sense that we  overcame
great opposition to win the bid to manage Alexkor, the state-owned diamond  mine
in  South Africa. The Company also acquired the entire diamond portfolio of Gold
Fields  in South Africa and was awarded five exploration blocks in north-eastern
Namibia. It has been challenging in the sense that we withstood one of the worst
years  in  the  recent  history of the diamond industry. In  October  1998,  our
operations  in  Angola were brought to an unexpected halt by the  resumption  of
hostilities  between  Unita  and the government in  that  country.  Our  Angolan
experience  has taught us to weather the storm and to diversify risk  by  having
projects  in  other, more stable countries. We hope that Angola will  return  to
normality so that we may continue with what are fantastic diamond properties.

The  highlight  of  the  year was the award of the management  contract  of  the
state-owned diamond mine, Alexkor, to the Nabera consortium, of which  Petra  is
the  lead  member  with 29,5%. Alexkor has a long history of production  and  is
still a very large producer of high quality diamonds in South Africa. Since  the
mine  started  operations in the late 1920's, some 10 million carats  have  been
mined.

The future growth of Petra Diamonds lies in the development of both alluvial and
kimberlite  deposits.  Petra  has both types of  deposit  in  its  portfolio  of
 properties.

The coming year will focus on:

-    Returning Alexkor to profitability and embarking on an extensive
     exploration programme

-    Completing the bulk sample at Syferfontein

-    Commencing exploration in Namibia

-    Commencing exploration in Botswana

-    Possible acquisitions giving Petra Diamonds an immediate cash flow.


REVIEW OF OPERATIONS

SOUTH AFRICA

The success of our Alexkor bid has been the highlight of the year, winning as we
did against 27 other leading diamond mining companies.

The Nabera team, under the leadership of Petra's Larry Neuhoff took over the
management of the operation on 17 May 1999. The mission to return the operation
to a profitable footing within as short a time as possible, and to add value by
proving up additional economically mineable reserves, both on land and in
marine.

A  strategy  embracing  sound  economic  principles  has  been  developed,  the
foundation of which involves:

* an exploration programme focussed on proving up additional reserves to allow
  us to extend the life of the mine;

* a focus on production, which will ensure that targets are met and that costs
  are constrained;

* security - reassessment of the current security arrangements with a view to
  upgrading and improving these;

* financial controls focussed on cost reductions and control of expenditure;

* ore reserves - reprocessing of the geological and mine costing data to
  facilitate a better definition of mineable blocks.

Initial  focus,  where early headway has been made, has been on outsourcing  the
shallow  water  contracts,  understanding and  then  containing  runaway  costs,
redefinition  of  current ore reserves, improving security,  looking  at better
mining  methods,  and generating a better and more harmonious relationship  with
labour.


Blue Diamond Mines

Port Nolloth

Mining  of  the  identified gravel horizons continued until the end  of  January
1999,  from  which  date  the operation was moved onto an  exploration  footing.
 During the seven months to end of January, 975 carats were produced, mainly
from the  north trench excavation. Grades proved to be laterally inconsistent,
and  a decision  was  made  to revert to exploration in an effort to  identify 
gravel bodies worth mining.

This  exploration has focussed initially on three areas, McDougall's Bay Trench,
Jassie's  Trench  and  AA Trench. Initial sampling from AA Trench  is  extremely
encouraging  and  the  trench  is currently being  broadened  to  confirm  these
results. Once confirmed, new trenches will be opened up along strike to evaluate
the lateral continuity of the diamond bearing gravel.

Syferfontein

During  the period under review, Blue Diamond Mines acquired most of the diamond
portfolio  of Gold Fields of South Africa. This encompassed some ten properties,
the  most  advanced of which is the Syferfontein property located  150  km  from
Johannesburg, adjacent to the gold mining areas of Klerksdorp and Stilfontein. A
diamond bearing kimberlite, 1.365 hectares in size, had been discovered on  this
property using geophysical methods. Petra has started a minibulk sample.

The  rest of the properties acquired from Gold Fields of South Africa are  being
subjected to desk studies, and initial field sampling will be performed over the
best properties during the next year.

ANGOLA

Petra has, in Alto Cuilo, Muriege and Media Kwanza, three of the most
prospective diamond concessions in the world. Initial exploration on Alto Cuilo
has identified 31 prospective kimberlite targets, and drilling has already
intersected kimberlite.

Hostilities  between  Unita and the Government forced  the  company  to  make  a
strategic  withdrawal  from  its camp on the Alto Cuilo  project.  Most  of  the
equipment  has been withdrawn to Saurimo and is being stored there. The  company
has a representative who is based in Saurimo, and the Petra office in Luanda  is
still in operation.

Petra's  partners have accepted a state of force majeure, but  all  parties  are
performing  the  necessary tasks to ensure that, should hostilities  cease, the
company will be in a position to continue with these exciting projects.

NAMIBIA

Petra  has been awarded five concessions in the north eastern corner of Namibia,
adjacent  to  the  area where a number of kimberlites have  been  identified  in
Botswana.  An  exploration programme is being planned and will be  scheduled  to
start in the coming year.

BOTSWANA

Petra has been granted an option to explore approximately 600,000 acres of  land
in Botswana by Mosetse Diamond Projects.

Mosetse holds Prospecting Licenses over three potentially diamondiferous  blocks
of  ground  located east of the important diamond mines in the Orapa  Wimberlite
cluster.

In  1999,  the  Botswana  Geological Survey  released  the  results  of  a  new,
high-resolution  magnetometric survey over this region. It is  anticipated that
the  new magnetic data will be sufficiently sensitive to reveal the presence  of
kimberlites  of  low  magnetic  intensity, in areas  where  their  effects  were
previously obscured.

FUNDING

Petra has successfully completed a private placing of £1.2 million. The proceeds
of this placement will be used for the further exploration of Petra's
concessions in South Africa, Namibia and Botswana and for working capital. We
are continuously looking for new opportunities, especially with regards to
companies with a positive cash flow, or in nearproduction, thereby providing a
cash flow for Petra.

ADONIS POUROULIS
Chairman





Consolidated Profit and Loss Account
for the year ended 30 June 1999
                                                         25 March 1997
                                             1999      to 30 June 1998
                       Notes       £         £          £          £
Turnover                   1              100,445               260,407
 Continuing operations          100,445                 -
 Acquisitions                       -                260,407
Cost of mining operations  2             (461,752)             (467,363)
 Continuing operations         (461,752)                -
 Acquisitions                       -               (467,363)
Gross loss                               (361,307)             (206,956)
Other operating income
 and charges               2           (1,007,151)           (2,460,571)

Operating loss                         (1,368,458)           (2,667,527)
 Continuing operations       (1,368,458)          (1,903,465)
 Acquisitions                                       (764,062)
Share of operating
 loss of associate                        (10,266)               (2,802)
Finance costs              3              (16,776)              176,029
Loss on ordinary
 activities before and
 after taxation for
 the financial period      1            (1,395,500)          (2,494,300)
loss per ordinary share    6                (4.11p)              (8.36p)


Statement of Total Recognised Gains and Losses

for the year ended 30 June 1999
                                                          25 March 1997
                                               1999     to 30 June 1998
                                                  £                   £
Retained loss for the year              (1,395,500)         (2,494,300)
Exchange adjustments on
 translation of subsidiary
 undertakings                               93,230          (1,432,440)
Total recognised gains and losses       (1,302,270)         (3,926,740)

Consolidated Balance Sheet
at 30 June 1999

                                               1999               1998
                                  Notes           £                  £
Fixed assets
Intangible assets                     7   8,660,792          6,613,667
Tangible assets                       8     370,041            376,820
Investments                           9         857                  -
                                          9,031,690          6,990,487
Current assets
Stock                                10       5,230             23,628
Debtors                              11     434,469            222,839
Cash and cash equivalents                    38,164          1,862,196
                                            477,863          2,108,663
Creditors: amounts failing
 due within one year                 12  (1,698,595)          (353,403)
Net current assets/(fiabilities)         (1,220,732)         1,755,260
Total assets less current liabilities     7,810,958          8,745,747

Capital and reserves
Called up share capital              14   3,414,973          3,381,076
Share premium account                15   9,622,784          9,291,411
Other reserves                       15 (1,339,210)         (1,432,440)
Profit and loss account              15 (3,889,800)         (2,494,300)
Equity sharehoIders funds                7,808,747          8,74,5,747
Minority interest                             2,211                 -
                                          7,810,958          8,745,747


Consolidated Cash Flow Statement
for the year ended 30 June 1999

                                                         25 March 1997
                                              1999     to 30 June 1998
                                  Notes          £                   £

Net cash outflow from
 operating activities                16   (474,950)         (1,916,482)
Returns on investments and
 servicing of finance
Interest received                           23,332             177,102
Interest paid                             (13,375)              (1,597)
Hire purchase agreement
 interest paid                                  -               (1,818)
Net cash inflow from returns on investments
and servicing of finance                     9,957             173,687
Capital expenditure and financial investment
Purchase of tangible fixed assets         (66,564)            (331,657)
Sale of tangible fixed assets               12,105              14,548
Investment in exploration costs        (1,751,438)          (2,497,121)
Purchase of associate                          (3)                (460)
Purchase of subsidiaries                   (5,156)          (6,217,603)
Net cash purchased in subsidiaries              -               (5,397)
Net cash outflow from capital expenditure
 and financial investment              (1,811,056)          (9,037,690)
Financing                                                  
Issue of shares                            365,270          13,351,303
Repayment of borrowings                          -             (21,199)
Repayment of hire purchase agreement                           (12,529)
Expenses paid in connection with share issues    -            (678,816)
Net cash inflow from financing             365,270          12,638,759
increasel(decrease) in cash and cash 
equivalents                             (1,910,779)          1,858,274
Cash and cash equivalents at beginning 
of year                            18    1,858,274                   -
Cash and cash equivalents at 
end of year                        18      (52,505)          1,858,274


Net cash outflow from operating activities

                                                        GROUP
                                                        25 March 1997
                                               1999     to 30 June 1998
                                                  £                 £
Operating loss                           (1,368,458)       (2,667,527)
Depreciation and amortisation               101,387            74,788
Exploration costs written off                80,241           490,950
Exchange differences                       (317,478)          268,406
Loss on sale of tangible fixed assets         2,052             2,217
Provision for potentially irrecoverable 
loan to associate                            23,904           139,214
Decrease in stock                            18,398            (5,692)
Increase in debtors                        (238,476)         (340,725)
Increase in creditors                     1,223,480           121,887
                                           (474,950)       (1,916,482)

NOTES TO THE ACCOUNTS

1.  This is the Company's second Annual Report. Comparative figures are for     
   the period 25 March 1997 to 30 June 1998.

2.  There are no dividends paid or proposed.

3.  The Company's only activities are mining and exploration, which all occurs
    in Africa.

4.  The financial information set out above does not constitute statutory
    accounts within the meaning of section 240 of the Companies Act 1985.

5.  These accounts were approved by the directors on 10 December 1999.

6.  The Annual General Meeting will be held on 11.00 am Tuesday, 18 January     
   2000 at Boswell City Financial PR Limited, Bridewell House, 9 Bridewell      
  Place, London EC4V 6AW.