Mine Capacity Increased at Guinea Operations

NOT FOR DISTRIBUTION IN THE UNITED STATES OR FOR DISSEMINATION TO US NEWS WIRE SERVICES.

15 JULY 2010

AIM: STEL

Stellar Diamonds plc

("Stellar" or the "Company")

Mine Capacity Increased at Guinea Operations

Stellar Diamonds, the London listed (AIM:STEL) diamond mining and exploration company focused on West Africa, is pleased to announce an operational update at its Mandala mine and Bomboko trial mine in south east Guinea.

Highlights:

·; New mine plant introduced at Guinea operations to increase production

·; Production at Mandala has exceeded 83,000 carats to date

·; Production at Bomboko has yielded over 4,500 carats to date

·; Combined diamond sales have generated $2.9 million in revenues to date

Summary of Production and Sales

At the Mandala diamond mine, production for the first six months of 2010 yielded 36,945 carats at an average grade of 32 carats per hundred tonnes ("cpht"). Total production at Mandala since mining commenced in April 2009 has now exceeded 83,000 carats at an average grade of 38cpht with sales returning an average price of $32.7 per carat. The Company is targeting monthly production of 12,000 cts at Mandala as part of its production ramp up, which is now well underway.

At Bomboko production from trial mining for the first six months of 2010 has yielded 3,151 carats at an average grade of 4cpht. Total production at Bomboko (including the period before Stellar acquired West African Diamonds plc) has reached 4,540 carats at an average grade of 4cpht with sales returning an average price of $116.7 per carat.

As planned at the time of the Placing and Re-Admission to AIM, additional earth moving equipment has been introduced at both sites during the last quarter with four 30-ton articulated dump trucks, two excavators and two front end loaders. This will enable production at both Mandala and Bomboko to be increased during the second half of 2010.

Diamond sales have been undertaken in both Dubai and Antwerp during the first six months of 2010. For Mandala some 32,959 carats were sold for $1.27 million (average of $38.5 per carat). This figure includes the 37-carat fancy yellow which was selected for polishing. Unfortunately the stone broke during the final stages of polishing, however it was insured for its rough valuation of $150,000. For Bomboko three sales totaling 2,377.24 carats achieved $275,030 (average of $115.7 per carat). Total sales to date have realised $2.9 million (including the period before the acquisition of West African Diamonds plc).

Karl Smithson, Chief Executive Officer, commented:

"After boosting our mining capacity at Mandala and Bomboko Stellar is well positioned to significantly increase its production and revenues as well as reduce its unit costs per carat produced. This should place the Company in a strong financial position enabling us to progress with our core strategy of developing our key kimberlite assets in Sierra Leone and Guinea. Exploration has already commenced at our high-grade Tongo kimberlite dyke in Sierra Leone, with a bulk sampling programme underway. We look forward to updating shareholders on our progress in the coming months."

About Stellar Diamonds plc

Stellar Diamonds plc is a London (AIM: STEL) listed diamond mining and exploration company that has a portfolio of projects in West Africa. Two projects in Guinea are in production, Mandala and Bomboko, which provide cash flow to the Company.

Stellar also owns full rights over four high-grade kimberlites that are the focus of longer term development. In Sierra Leone the Tongo and Kono projects comprise a series of diamondiferous kimberlite dykes, with the Kono project having produced 4,200 carats of diamonds through underground trial mining by the Company. In Guinea the Company's Droujba kimberlite pipe and Bouro kimberlite dykes are located in proximity to the Company's Mandala mine and demonstrate grades of up to 200cpht and 500cpht respectively.

For further information please contact the following or visit the Company's website at www.stellar-diamonds.com.

Stellar Diamonds plc

Karl Smithson, Chief Executive Tel: +44 (0) 7783 707971

RBC Capital Markets

Martin Eales / Daniel Conti Tel: +44 (0) 20 7653 4000

Astaire Securities

Charles Vaughan Tel: +44 (0) 20 7448 4400

Pelham Bell Pottinger

Charles Vivian / James MacFarlane Tel: +44 (0) 20 7861 3232