Drilling Report

SouthernEra Discovers 'Meta-Kimberlite' Pipe within the Makongonio

    Alluvial Diamond Field in Gabon, West Africa

 

    SouthernEra Diamonds Inc.

    Shares Issued and Outstanding: 85,335,411

    TSX: SDM

    AIM: SRE

 

    TORONTO, Oct. 6 /CNW/ - SouthernEra Diamonds Inc. ('SouthernEra') (TSX:

SUF, AIM: SRE) today announced the discovery of 'meta-kimberlite' bodies at

the Makongonio diamond exploration project in southern Gabon. SouthernEra has

a 60 percent interest in the 1,837 square-kilometer Makongonio Project in

Joint Venture with the Gabonese mining company COGEMAT, and is also the

operating partner in the Joint Venture.

    SouthernEra has been actively exploring for diamonds in Gabon since 1999.

Exploration commenced with regional stream sampling to determine the diamond

potential of selected areas within Gabon. Recovery of kimberlitic indicator

minerals (KIMs), some with diamond inclusion chemistry, resulted in the

identification of five geographically distinct interest regions. In addition

to the Makongonio Project, SouthernEra now has three diamond exploration

permits elsewhere in Gabon, the 100 percent owned Kango and Sud projects, and

the 95 percent owned M'bigou Project.

    During 2003, Fugro Airborne Surveys completed a 43,230 line-kilometer

200-meter line spaced magnetic and radiometric airborne geophysical survey

that covered high kimberlite potential areas within these projects.

    SouthernEra initially identified the Makongonio Project area based on the

area's past production of the highest value and largest alluvial diamonds in

Gabon. Over 36,000 carats of alluvial diamonds were commercially mined in the

mid-1950's by the now defunct Gabonese/French mining company, SOREDIA.

Production from the artisinal miners who are currently working within the

project area is unknown. Following a field trip to Makogonio in April 2002,

SouthernEra's Chairman Dr. Christopher Jennings stated: 'These are the most

beautiful natural state diamonds that I have ever seen. They are almost

entirely free of inclusions and are very white.' Historically, this alluvial

diamond field within the Makongonio Project area has produced two gem-quality

diamonds of over 50 carats, as well as an 85.5-carat boart.

    Following the formation of the Makongonio JV in 2002, SouthernEra

conducted the first phase of reconnaissance stream sampling over the project

area. This resulted in the recovery of kimberlitic spinel (some exhibiting

diamond inclusion chemistry) and rare kimberlitic ilmenite from 151 positive

samples. These samples were processed at SouthernEra's company owned and

operated diamond laboratories in Libreville, Gabon and Polokwane, South

Africa. In addition, a white equidimensional octahedral micro-diamond,

measuring 0.92 mm, was recovered from one of the stream samples. Numerous KIM

positive drainage basins are evident, forming corridors up to 16 kilometers in

strike length. Second phase stream sampling is now at an advanced stage, and

soil grid sampling has commenced. Following last year's Fugro airborne survey,

over thirty aeromag 'pipe-like' targets were selected for ground-proofing, and

to-date kimberlitic spinel have been recovered from soil samples over four of

these targets. These four targets are currently being drilled tested.

    During July 2004 eight occurrences, which appeared to be kimberlitic,

were discovered sub-cropping in various KIM positive streams. Consultant

geologist Mike Skinner has since confirmed three of these bodies

petrographically as 'meta-kimberlites'.

    Although highly altered, one of these bodies, Mak-001, which is pipe-

shaped, is rated petrographically as high-interest due to the presence of

abundant olivine macrocryst relicts as well as very fine matrix spinel. These

rocks have been altered by low-temperature metamorphism, as indicated by the

alteration of existing minerals to talc. However, the diamond potential of

these bodies is unlikely to have been affected by these low temperature

conditions. These three 'meta-kimberlites', as well as the remaining five

bodies (altered-lamprophyres, altered-igneous rocks, or in some cases

unidentified) all contain kimberlitic spinel, some with diamond inclusion

chemistry. This mineral chemistry is similar to spinel recovered from the

regional stream sampling campaigns, suggesting that these rock types are the

source of these spinel.

    Most of these bodies occur as dykes, some up to 9 meters wide. However,

the hypabyssal-facies pipe, Mak-001, is at least 70 meters wide in one

direction and greater than 25 meters wide in another. The discovery of this

'meta-kimberlite' pipe is highly significant as it is the first known pipe in

Gabon. Unlike other parts of Gabon, the Makongonio Project area appears to

have been protected from significant erosion by a blanket of sedimentary rocks

thus there is potential for the discovery of additional pipe-like bodies

within the permit. Of equal significance is the discovery of the wide dykes,

which sit within KIM positive corridors over 10 kilometers in strike length.

It is important to note that artisinal activity in the streams often halts

just down-stream of these meta-kimberlite bodies.

    Commenting on progress at the Makongonio Diamond Project, SouthernEra's

President and CEO Patrick Evans said: 'We are very pleased with these new

early stage discoveries. We have long felt that the sources for the Makongonio

alluvial diamonds are in close proximity to the alluvial workings. Should the

newly discovered pipe and dykes prove to be diamondiferous this will be very

significant indeed'.

    Two 200-kilogram samples from two different bodies (one the pipe Mak-001

and the other a 7.5 meter wide dyke, Mak-002) are presently in Canada for

micro-diamond analysis at SGS Lakefield Research Limited. Results from this

analysis are expected by mid-December.

    Field work at Makongonio is ongoing. Besides the drilling currently

underway, the program consists of continued detailed stream and soil sampling,

ground geophysics, pitting and trenching.

    Uwe Naeher, Professional Geologist, is the qualified person, under    

NI 43-101, responsible for the technical information in this release.

    Gabonis one of five countries in which SouthernEra Diamonds Inc. is

engaged in extensive diamond exploration. Others include Canada, Australia,

the DRC and South Africa. This represents the fourth most active global

diamond exploration program after the three majors DeBeers, BHPB and Rio

Tinto. The Company also operates the Klipspringer Diamond Mine in South Africa

and maintains an 18 percent free-carried interest in the Camafuca Diamond

Project in Angola.

 

    Some statements contained in this news release are forward-looking and,

therefore, involve uncertainties or risks that could cause actual results to

differ materially. Such forward-looking statements include comments regarding

exploration work. Actual results could differ materially from those

anticipated. The Company disclaims any obligation to update forward-looking

statements.

   

    For further information: SouthernEra Diamonds Inc.: Howard Bird, Vice

President Exploration, or Sharon Allan, Investor Relations, Telephone:

[phone], Fax: [phone], E-mail: inbox(at)southernera.com,

www.southernera.com

    (SRE SDM.)