South African Projects

Savanna Project

Bonaparte Diamond Mines has signed an Agreement to acquire 100% of a South African company Savanna Diamonds (Pty) Ltd ("Savanna"). Savanna holds a current Mining Permit over a 3,073 hectare property located 142km northeast from Kimberley. The agreement allows Bonaparte an option period to operate the mine and establish grade through bulk sampling before final settlement.

The diamond bearing gravel deposits on the Savanna property are located within an ancient (>65 million year old or Cretaceous age) river channel that lies in a dolomite country rock which is prone to formation of potholes.

Vaal River Alluvial Project (70%)

The Vaal River Project ("Vaalbos Project") is a highly prospective property of approximately 18,000 hectares located in the heart of the alluvial diamond production areas adjacent to the Vaal River to the west of Kimberley. Published reports note historical mining (early 1930's) on the property produced some 490,000 carats including several stones over 100 carats. The Vaalbos Project supports Bonaparte’s plans for expansion of production in South Africa to supplement the Savanna production and the Namibian marine mining production.

The prospecting permit application has been submitted by local community partners, the Sydney on Vaal Land Restitution Trust ("SOVRT") on 26 November 2007 following a strengthening of the working agreements between the parties.  Bonaparte, through its local subsidiary, Samber Trading No 115 (Pty) Ltd, will now hold a 51% share of Vaalbos Diamonds which has an exclusive prospecting and mining agreement with SOVRT.  The shareholding of Vaalbos Diamonds has been adjusted to incorporate an effective 26% Black Economic Empowerment ("BEE") ownership, of which SOVRT will hold 15% and 11% will be held by two other BEE entities, still to be selected. The remaining 23% is held by the project vendors.

Joint Venture Alluvial Project, Bloemhof (65%)

Bonaparte, through its South African subsidiary, has entered into a Joint Venture ("JV") agreement with two local parties, one of which is the surface rights holder to the land that forms the focus of the JV. Bonaparte will hold a 65% interest in the JV which is BEE compliant. The JV was established to apply for mineral licences on the land held by the JV partners with the objective of establishing diamond mining operations. The JV land is situated within the alluvial diamond bearing "runs" which are actively mined within the area surrounding Bloemhof, which is situated approximately 100km NNE of Kimberley.

In terms of the agreement, Bonaparte will fund exploration operations up to issue of a mining licence over all or part of the properties whereafter costs and revenues will be shared in accordance with the shareholding. Bonaparte will be the appointed operator for all exploration and mining activities on the properties. The Company's geologists are of the opinion that the project has potential for fast track exploration and mining development.

Bronkhorstfontein Project (74%)

The Bronkhorstfontein Project covers an area of approximately 370 hectares and lies some 20km south of Heilbron in the Free State of South Africa. Previous exploration over a small portion of the area is reported to have identified a magnetic anomaly from which follow up sampling gave positive kimberlitic indicator minerals.