LONDON, ENGLAND -- (MARKET WIRE) -- October 04, 2006 -- Gem Diamond Mining Company of Africa Ltd (Gem Diamonds) and its partner the Government of the Kingdom of Lesotho (Lesotho Government), the owners and operators of the Letseng Diamond Mine in Lesotho, southern Africa, are delighted to announce the recovery of a 603 carat white diamond at Letseng.

The diamond, named the Lesotho Promise is the largest reported find this century and ranks as the 15th largest diamond ever found. The stone is an exceptional colour, rated D, the top colour for diamonds. The largest diamond previously found at Letseng was the 601 carat Lesotho Brown, recovered in 1967.

Letseng, which is situated in the Maluti Mountains in Lesotho, is a world class mine, renowned for the quality and size of its diamonds. Its revenue per carat is currently unsurpassed in kimberlite diamond mining.

The Lesotho Promise is being put up for sale today, 4 October 2006, through a private tender in Antwerp. The tender process is expected to be completed by Monday, 9 October, with an announcement of the winning bid on the same day at the Antwerp World Diamond Centre, the HRD, in Antwerp.

Lesotho's Minister of Natural Resources, Dr Khaketla said:

"We are proud that a Lesotho diamond has made history for a second time. The "Lesotho Promise" heralds an auspicious start to our partnership with Gem Diamonds at Letseng. Furthermore it comes at a time when the Kingdom of Lesotho is celebrating 40 years of independence."

Clifford Elphick, CEO of Gem Diamonds said:

"This exceptional find reinforces the excellent potential of Letseng. Gem Diamonds, has always been confident about the potential of Letseng and we are delighted to commence our partnership with the Government of Lesotho by recovering a stone of this size and historic significance. We hope that this will be a symbol of Letseng's continuing success."


Contacts:
Merlin
Bridget Fury
+44 20 7653 6620

Merlin
Lachlan Johnston
+44 20 7653 6620

SOURCE: Gem Diamond Mining Company of Africa Ltd