Update on Bouro Kimberlite Project

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15 March 2011

AIM: STEL

Stellar Diamonds plc

("Stellar" or the "Company")

HIGHLY ENCOURAGING DIAMOND GRADES FROM BOURO KIMBERLITE PROJECT IN GUINEA

Stellar Diamonds plc, the London listed (AIM:STEL) diamond mining and exploration company focused on West Africa, reports encouraging diamond grades from initial bulk sampling at the Company's 100% owned Bouro kimberlite dyke project in Guinea.

Highlights:

·; First sample of 233 tonnes from Bouro North Dyke returned 565 carats

·; Sample processed via the Company's 100 ton per hour plant at Mandala 1km from site

·; In-situ grade of 243cpht (+1.7mm) with 20 diamonds greater than 1 ct and largest of 3.67 cts

·; Bouro has previously been the subject of significant artisanal mining to depths of up to 17m

Karl Smithson, Chief Executive Officer, commented:

"The first sample collected and processed from the Bouro North kimberlite has returned a significantly high diamond grade of 243 carats per hundred tonnes ("cpht"). We intend to collect a further two samples from the kimberlite in order to obtain more representative information from this 5km long kimberlite. The diamonds recovered will be exported to Antwerp for valuation and sale in order to establish the preliminary diamond value for the kimberlite.

"Bouro is one of four high grade kimberlites in Stellar's portfolio and is located only 1km from the Mandala alluvial project and processing plant. It is considered that Bouro is one of the likely primary sources for the diamonds mined at Mandala. The Company has considerable diamond mining infrastructure at Mandala and therefore the evaluation of the Bouro kimberlite can be undertaken in a rapid and cost effective manner.

"Following on from our successful placing of £6.2million, which is conditional upon shareholder approval at the General Meeting to be convened on 28 March 2011, Stellar has the necessary funds in place to advance its strategy of organic growth through the development of its portfolio of high grade kimberlites. I look forward to updating shareholders on our progress as further results become available."

Bouro North Kimberlite Dyke

The Bouro North kimberlite dyke was discovered in the early 1960s by the Russian Aid Mission and more recently tested by De Beers. It has been mapped and drilled over a distance of 5km, with widths of 30cm to 2m being recorded and sampled at various localities. Results reported from both groups indicated the kimberlite has a diamond grade of up to 500cpht. Independent analysis of the De Beers microdiamond results, commissioned by Stellar, suggests the diamond grade of the kimberlite ranges from 148cpht to 648cpht.

Stellar holds three licences, totalling 207 square kilometres, over the Bouro area. These licences cover four known kimberlite dykes, of which Bouro North is the most extensively sampled, as well as a number of unresolved mineral and geophysical anomalies that could potentially represent undiscovered kimberlites.

Based on the previous high grades realised for Bouro North, Stellar has embarked on a bulk sampling exercise. Three initial samples of approximately 250t each will be collected and processed via the Mandala processing plant located 1km away.

Bouro North Sample Collection

The first bulk sample was collected on the eastern end of the kimberlite dyke. Since the kimberlite has been heavily dug in the past by artisanal diamond miners, the top 10m to 17m of overburden was removed until undisturbed kimberlite was reached. The kimberlite zone comprised of a series of stringer to wider dyke intrusions over an average width of 2m. The widest kimberlite intersection seen over the 70m long bulk sample trench was 70cm which the Company geologists considers as encouraging.

Bouro North Sample Processing

The Mandala processing plant is being utilised to process the kimberlite samples collected from Bouro. Although the processing plant is currently designed to treat alluvial gravels, the kimberlite samples from Bouro are sufficiently decomposed for the plant to break the kimberlite down and process the material in its entirety. The Mandala plant has a bottom cut off of 1.7mm and therefore all diamonds less than that size (some of which would be classified as commercial sized stones) would have gone to slimes and are not reflected in the result.

Bouro North Kimberlite Sampling Results

A total of 232.81 tonnes of kimberlite were collected and processed over the past month, from which 565.16 carats of diamonds were recovered, giving a calculated +1.7mm grade of 242.76cpht (Table 1). Twenty stones of greater than 1 carat were recovered and the largest diamond was 3.67 carats. Preliminary analysis shows that 4% of the diamonds are classified as gem quality, similar to the Mandala production, although this is expected to increase after the diamond parcel has been subjected to acidisation and cleaning. This will take place in Antwerp in April, after which the goods will be valued and sold in order to establish the diamond value for the sample.

Table 1: Summary of Bulk Sample Results for Bouro North Dyke - Sample 1

About Stellar Diamonds plc

Stellar is a London (AIM: STEL) listed diamond mining and exploration company that has a portfolio of projects in West Africa.

Stellar owns a 100% interest in four high-grade kimberlite projects that are the focus of exploration and development. In Sierra Leone at the Tongo project a bulk sampling programme is ongoing on one key kimberlite to assess the diamond grade and value. At the Kono underground trial mine, bulk sampling by the Company has produced 4,200 carats as part of an economic evaluation exercise. In Guinea drilling is continuing on the diamondiferous Droujba kimberlite pipe and bulk sampling is underway on the high grade Bouro kimberlite dyke, which is adjacent to the Company's Mandala alluvial diamond operation.

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

In accordance with the AIM Rules, the information in this announcement has been reviewed by Karl Smithson, CEO of Stellar, a qualified geologist with 22 years of experience.

Stellar Diamonds plc

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

Angus Ogilvie, Finance Director Tel: +44 (0) 7885 201 903

RBC Capital Markets

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

Northland Capital Partners Limited

Charles Vaughan / Gavin Burnell Tel: +44 (0) 20 7492 4763

Pelham Bell Pottinger

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