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Company Information for Karelian Diamond Resources Plc

AIM-KDR

www.kareliandiamondresources.com

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AIM; KDR

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Company Statement

Active in diamond exploration since 1994 in the Karelian Craton, we believe that the Finnish sector has the potential to host similar world-class diamond deposits to those found in the Russian sector.

First listed on AIM in August 2005, Karelian Diamond Resources P.l.c. has made significant progress, including acquiring the Seitaperä diamondiferous kimberlite pipe, licensing extensive and highly prospective areas and identifying numerous kimberlitic anomalies and exploration targets which we methodically and actively pursue.

Our established exploration experience, long-standing relationship with the Geological Survey of Finland (GTK) and an in-house track record of kimberlite exploration and development stand us in good stead to realize our objective…

… to discover and develop the first diamond mine in the European Union…

Professor Richard Conroy
Chairman

Current Operations

Kuhmo
Regional Information:
The provinces of Oulun Lääni and Pohjois – Karjala Lääni have been of interest to the Company for a number of years. Oulun Lääni covers an area of 57,000 km² and Pohjois – Karjala Lääni, an area of 21,500 km². There are five municipalities in the principal area of interest to the Company, the main one being in the Kuhmo municipality.

Kuhmo is the largest population centre in this region, and houses one of Geological Survey of Finland’s (GTK) main Kimberlite Indicator mineral (KIM) laboratory facilities. The nearby city of Kajaani is served by excellent road (E63), rail and domestic air links.

Prospectivity:
The Company’s highly prospective area in the Kuhmo Claims Area covers over 7,000 km². The Company has been active in this area for a number of years and has identified the area as highly prospective.

This area hosts a series of previously discovered kimberlites, in particular in the Lentiira and Seitaperä areas, where they occur principally as dykes and/or expansions, blows and small pipes associated with major dykes or fissures found within a wide structural zone. Kimberlites in this area are considered to exhibit a similar geology and geochemistry to those found in the Russia at Arkhangelsk.

Work to Date:
Karelian Diamond Resources has been active in this area for a number of years and has identified the area as highly prospective. Under Conroy Diamonds and Gold, the Company identified numerous geophysical targets from the regional geophysical survey undertaken by the GTK. The Company has collected over 500 regional and detailed till samples in this region, many of which proved positive for KIM’s, including numerous G9 garnets and also G10 garnets indicative of high-diamond potential kimberlites. More recently, the GTK has also taken 249 till samples as part of a non-proprietary regional survey, which have been used to augment the Company’s results.

The Ashton/Malmikaivos Oy partnership previously discovered three kimberlite bodies: Seitäperä (#16), Havukkasuo (#18) and Lentiira (#24) in this area. Seitaperä is a diamond-bearing kimberlite with a recently revised (2007) surface area of circa 7 Ha, the largest kimberlite found to date in Finland, and has been licensed by the Company. A detailed re-evaluation of this kimberlite, including additional drilling and analysis of previously-drilled core is ongoing.

Elsewhere in the general area, the Company is well advanced in following up on several well-defined KIM trains towards their immediate source areas and has also undertaken ground magnetic surveying over localized targets associated with KIM trains at a higher resolution, to augment the existing 200 m line-spacing regional airborne survey.

Regional Exploration
Elsewhere in the general area, the Company is well advanced in following up on several well-defined KIM trains towards their immediate source areas. This includes activities in the general vicinity of Seitaperä, and also at Riihivaara, circa 10 km to the SSE, where the company also has an extensive block of claims and claim reservations.

At Rihiivaara, a relative concentration of indicator minerals has led to the identification of a pronounced train, over 5 km in length, and including numerous possible targets based on the geophysics (magnetics). Several of the down-ice targets have been drill-tested, but have failed to reveal a kimberlite to date. However, a number of prominent targets still remain to be tested up-ice. In the meantime, the Company continues to undertake detailed KIM sampling in the area to further define this train. The Company has amassed a substantial database of indicator mineral results, including from over 126 samples positive for garnet (of which 65 are from the Riihivaara train) and nearly 9,000 chromite grains recovered from till samples (nearly 3,000 of which are from the Riihivaara train).

Rihiivaara is characterized by frequent kimberlitic indicator minerals. Again, pyrope garnets and chromites are the principal indicators, and exhibit chemical characteristics consistent with highly prospective kimberlites. The company has undertaken extensive regional KIM sampling, as well as thoroughly evaluating available open-file data from the area. Over 6% of pyrope garnets recovered to date have G10 compositions, of which nearly half are promising hi-Cr G10s. Similarly, circa 0.6% of all chromites recovered from both regional sampling in the area, and from within the Riihivaara train, are DI-chromites which come exclusively from kimberlites and are sourced from potentially diamond-stable mantle.

Joensuu
Regional Information:
The province of Pohjois – Karjala Lääni has been of interest to the Company for a number of years. Pohjois – Karjala Lääni covers an area of 21,500 km² and there are 19 municipalities in this region. Joensuu is one of the larger centres in this region and is served excellent by road, rail and domestic air links.

The nearby city of Outokumpu is associated with the Keretti and Vuonos mines, which formed the main basis for modern mining and metallurgical industries in Finland. The city remains as an important mining technology centre today, including hosting the GTK’s Mineral Processing Research Group, which can also provide kimberlite bulk sampling facilities.

Prospectivity:
The Company’s highly prospective Joensuu Area covers some 7,900 km². The Company has been active in this area for a number of years. Recent regional work by the GTK, including acquiring over 400 till samples, has demonstrated the widespread presence of KIM’s in this area.

This relatively new diamond exploration area lies some 100 km to the south east of the established Kupio-Kaavi kimberlite province, scene of some of first Finnish kimberlite discoveries in the 1980’s.

Work to Date:
Karelian Diamond Resources has had an active interest in this area for a number of years and, under Conroy Diamonds and Gold, identified numerous geophysical targets from the regional geophysical survey undertaken by the Geological Survey of Finland (GTK). As an initial follow-up, the Company has previously collected over 50 till samples in this area.

Following the recent GTK till sampling programme (400 samples taken), the Company has since successfully acquired extensive claim reservations associated with positive KIM results, and is undertaking more detailed follow-up till sampling. To date no kimberlite bodies have been reported in the area, however the presence of significant and dispersed KIM’s, in an area remote from other known kimberlites, suggests that this may be an entirely new and as-yet unknown kimberlite province.

Geographical Spread

The Karelian Craton in Finland.

Board of Directors and Key Management

Directors
Professor Richard Conroy	Chairman of the Board
Maureen Jones	Managing Director
James Jones	Finance Director
Seamus P FitzPatrick	Non Executive Director
Louis J. Maguire	Non-Executive Director
Roger I Chaplin	Non Executive Director

Senior Management
Professor Richard Conroy	Executive Chairman
Maureen Jones	Managing Director
Kevin McNulty	Senior Geologist
Stephen Grimmer	Senior Geologist
Egbert Gerryts	Consulting Geologist

Company Address

10 Upper Pembroke Street
Dublin, Ireland 2


Telephone:	+353 1 661 8958
Facsimile:	+353 1 662 1213
Website:	http://www.kareliandiamondresources.com

Capital

Fully Diluted: 70,198,337

Annual General Meeting

December

Year End

31 May

Nominated Brokers

City Capital Corporation Limited

Nominated Advisors

John East & Partners Ltd

Major Shareholders

Conroy PLC	Shares	30,815,030	(50.89%)
Professor Richard Conroy	Shares	6,216,671	(10.27%)
Gartmore Fund Managers Ltd.	Shares	6,442,333	(10.64%)

Most Recent Statement

25/02/10 - Half-yearly Report
09/11/09 - FINAL RESULTS FOR THE YEAR ENDED 31 MAY 2009
31/03/09 - Sampling Results
25/02/09 - Half-yearly Report
08/12/08 - Result of AGM & AGM Statement
12/11/08 - Final Results

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