chairman's letter to shareholders

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Level 1, 173 Mounts Bay Rd, Perth
Western Australia 6000
Telephone. 08 9481 0911
Facsimile. 08 9481 0922
Email. [email protected]
ABN 65 107 061 343
United Kimberley
Diamonds NL
1st February 2005
A Letter From The Chairman
Dear Shareholder
I am taking the opportunity at this time to give you an update on your Company’s
activities. The objectives of the Company were outlined in the Prospectus, stating a
significant amount of the $10 million raised in the IPO would be targeted towards
carrying out bulk sampling and exploration on the Company’s Diamond Tenements in
the Kimberley Region of Western Australia.
The projects we will initially target are as follows:
(i) Phillips Range Project
(ii) Ellendale South Project
(iii) North Argyle Project
These project areas have the potential to deliver major new diamond discoveries for
the Company. The Phillips Range project already contains the Aries pipe, Australia’s
largest diamondiferous kimberlite, the large Ellendale South project abuts Australia’s
newest diamond mine and offers excellent new discovery chances, and the North
Argyle project, immediately north of the massive Argyle diamond mine, has the
potential for another Argyle discovery.
Our main exploration focus in 2005 will be at the Phillips Range Diamond Project
where United Kimberley Diamonds NL (UKD) recently announced the signing of a
bulk sample treatment contract over a minimum of 100 days. This will allow us to
process the bulk sample material that will be generated from the forthcoming Bauer
drilling program (wide diameter drilling) on various kimberlite pipes, some of which
have never been tested. Shareholders are to be reminded that the diamondiferous
Aries pipe at Phillips Range has already produced a total weight of 1,819 carats of
diamonds and of these 95% were of gem quality.
At Ellendale South an aerial photographic study is currently underway with our aim to
identify geomorphic anomalies for drilling. An airborne magnetic survey is also
planned and these two datasets together provides extra detail on the existing pipes.
We believe this area has strong potential for the discovery of additional, highly
prospective, weakly magnetic pipes.
At the Argyle North Project, photogeological studies to define targets for detailed
field sampling are underway. The Company is targeting concealed pipes and fossil,
diamond bearing alluvials within a major ancient valley system draining northwards
from the Argyle diamond mine.
United Kimberley Diamonds NL
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The Company is also constantly evaluating new opportunities where major discovery
opportunities exist. Since our listing we have successfully acquired through
application new exploration tenements (100% UKD) covering most of the offshore
Cambridge Gulf area in the Kimberley (925km2). This area is prospective for marine
alluvial diamond occurrences and marine diamonds have been recovered nearby by
previous explorers.
The Company is using the current wet season (monsoon) effectively to ensure all
equipment and personnel are in place to make an immediate start when the northern
dry season commences.
Shareholders can be assured that we have first rate targets, professional staff and
qualified contractors to carry out the aims as stated in the Prospectus. UKD is exc ited
by the great potential for discovery in this forthcoming field season.
The Company now has a functioning webpage www.ukd.com.au where you can view
current updates on your Company’s progress. Chief Executive Officer Jim Richards
or Executive Director Matthew Hogan can be personally contacted on 9481 0911 and
are willing to answer any queries you may have.
Yours faithfully,
Philip G Crabb
Chairman
United Kimberley Diamonds N.L
United Kimberley Diamonds NL –
Diamond Project Locations
United Kimberley Diamonds NL
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UKD has contracted for a
large diameter Bauer Rig to
drill untested kimberlites at
the Phillips Range Project.
This will enable large
tonnage samples to be tested
for diamonds.
UKD will use this mineral processing plant for 100 days for the upcoming field
season. This plant will be treating the samples from the Bauer drilling campaign.