GEM DIAMONDS ANNOUNCES A CHANGE OF NAME FOR ITS BOTSWANA OPERATION

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25 Jul 2011

Gem Diamonds Limited (Gem Diamonds or "the Company") is pleased to announce a name change to its wholly owned subsidiary company in Botswana, Gope Exploration Company (Pty) Limited.

Gope Exploration Company (Pty) Limited, which holds a mining licence for the Gope Deposit, will now be known as Gem Diamonds Botswana (Pty) Limited; and the Gope deposit has been renamed Ghaghoo Diamond Mine.

The name change to Ghaghoo Diamond Mine resulted from numerous consultations with the residents of the Central Kalahari Game Reserve (CKGR) and reflects the Company's ongoing commitment to encouraging community involvement and building strong community relations. "Ghaghoo" refers to a species of camel thorn acacia tree which is abundant in the area, and is the name which residents of the CKGR have historically used to refer to the Gope area, prior to the arrival of the geological exploration teams over thirty years ago who re-named the area Gope, which literally translated, means "nowhere".

Clifford Elphick the CEO of Gem Diamonds commented:

"We are pleased to announce the name change of Gem Diamonds' operations in Botswana to Gem Diamonds Botswana (Pty) Limited and the Ghaghoo Diamond Mine. The name changes signify a change from an exploration focused company to one which is both an economically active and sustainable operation. We are also particularly pleased that as a result of our proactive ongoing community consultations with the residents of the CKGR we are able to recognise the original name Ghaghoo, by re-naming the mine site."

For further information:
Gem Diamonds Limited

Haile Mphusu, Managing Director
Gem Diamonds Botswana (Pty) Limited
Tel: +267 318 27 96

Gem Diamond Technical Services (Pty) Ltd

Sherryn Tedder, Corporate Affairs
Tel: +27 (0) 11 560 9600
Mob: +27 (0) 83 943 4505

James MacFarlane
Tel: +44 (0) 207 861 3864
Mob: +44 (0) 7841 672 831

About Gem Diamonds

Gem Diamonds is an international diamond mining company that has pursued a long term growth strategy through targeted acquisitions and the development of its existing assets. Following the recovery in diamond prices in 2010 the Company's focus has been to place itself in a position to take advantage of long term growth opportunities.

The Company's mining portfolio comprises producing kimberlite and lamproite mines in Lesotho and Australia, as well as a development project in Botswana.

With Letšeng's production of the world's most sought after remarkable white diamonds and Ellendale's production of rare fancy yellow diamonds, Gem Diamonds remains focused on higher value diamonds. This segment of the market is likely to deliver attractive long term returns.