Namakwa Diamonds Limited
12 February 2008

12 February 2008

LSE: NAD



                           INTERIM OPERATIONAL UPDATE

1. Pricing Environment



Namakwa is focused on the mining and beneficiation of high quality gem diamonds.
Namakwa continues to observe increases in the prices of both rough and polished
diamonds in these premium categories, with prices for bigger sized (> 5 carats)
and higher quality diamonds increasing substantially more than prices for
smaller, lower quality diamonds. The higher observed prices have to date
translated into higher beneficiation margins. Namakwa is optimistic about the
medium term price forecast for the higher quality diamonds on which Namakwa
focuses.



2. Mining Update



Namakwa currently produces diamonds from 4 alluvial mines in the North West
Province of South Africa. Production for the 2008 calendar year commenced during
the week of 7 January 2008, following the scheduled close over the holiday
period.



The impact of the power outages, coupled with the unusually high rainfall has
had a negative impact on Namakwa's production for January 2008. The resultant
lower level of tonnes of gravel produced, coupled with lower recoveries of
rain-affected gravel, resulted in diamond production being approximately 50% of
budgeted carats for January 2008 at 1,116 carats. Currently, the mines are
operating at budgeted capacity and are expected to continue to do so as the
rainy season comes to an end.



However, the average realised value of such production has increased to $915 per
carat, which compares to a budgeted value of $592 per carat, which will
partially mitigate the effect of reduced production. In addition, Namakwa has
recently acquired and installed stand-by electricity generation capacity in the
form of diesel generators at all of its operating mines in the North West, which
is expected to mitigate the impact of any Eskom power outages on Namakwa's
production, provided such outages do not last for extended periods of time.
Namakwa estimates that the use of diesel generators instead of Eskom power at
all operating mines will increase unit operating costs, measured in Rand per
tonne, by less than 10%. To the extent that Eskom power remains available for
the majority of scheduled production time, as is currently anticipated, the
impact on unit costs will be commensurately lower.



The capital expenditure required to implement the North West expansion program
has been approved by the Board and delivery of the expansion program remains on
track. In light of the significant capital expenditure programs which Namakwa
has embarked on in the North West and in the DRC, the Board has established a
sub-committee, chaired by Dr. Con Fauconnier, to oversee and monitor the capital
expenditure programs. The sub-committee will report regularly to the Board and
its responsibilities will reduce in line with the successful implementation of
the above capital expenditure programs.



3. Beneficiation Update



On 28 January 2008, Namakwa bought its first parcel of rough diamonds from the
State Diamond Trader in Johannesburg at the inaugural tender. A total of 276
carats of rough diamonds were acquired, which will be beneficiated at Namakwa's
Johannesburg factory and such polished diamonds sold by Namakwa to its existing
client base.



As at 31 January 2008, Namakwa had 4,040 carats of rough diamond inventory worth
US$8.8 million at cost, equating to US$2,179 per carat. The quality of this
diamond inventory is ideally suited to Namakwa's beneficiation skills and
experience.



4. Outlook



Namakwa remains committed in its efforts to reach its stated operational and
financial targets. The adverse impact of heavy rain and power outages should be
partially offset by increasing operational flexibility and the strong diamond
pricing environment.



For further information please contact:



Namakwa Diamonds - Nico Kruger

Tel: +27 11 334 8886



Taylor Rafferty - Rob Newman

Tel: +44 207 614 2900





About Namakwa:

Following its successful Initial Public Offer on 19 December 2007 on the London
Stock Exchange, Namakwa Diamonds is the only quoted vertically integrated
diamond mining company. Its strategy of backward integration from its 30 years
of beneficiation experience into mining has created a unique public investment
proposition. Namakwa Diamonds has a diversified portfolio of diamond projects,
which includes five distinct diamond resource target areas. These are located in
four African countries, namely; South Africa, the Democratic Republic of Congo,
Namibia and Angola. Namakwa's projects are located within historically
prospective geological environments. Alluvial diamond deposits constitute the
primary focus of the company, whilst kimberlite opportunities will be considered
if they represent an advanced stage of development, consistent with Namakwa's
philosophy of a short resource delivery time as provided by its alluvial diamond
mines.






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