Dr. Mike de Wit reports

TSODILO RESOURCES LIMITED ACQUIRES RIGHTS TO BK16 KIMBERLITE PIPE IN BOTSWANA

Tsodilo Resources Ltd. has been granted a prospecting licence over the BK16 kimberlite pipe located within the Orapa kimberlite field in Botswana. BK16 is located 37 kilometres east-southeast of Debswana's Orapa mine and 13 kilometres north-northeast of its Letlhakane diamond mine and 28 kilometres east-northeast from Lucara Diamond Corp.'s Karowe mine. Botswana diamond mines have produced an average of 27 million carats annually in the last 10 years and Botswana is the world's largest producer of diamonds by value. The licence grants the company the exclusive right to prospect for precious stones for an initial period of three years commencing Oct. 1, 2014.

Dr. Mike de Wit, president and chief operating officer of Tsodilo, stated: "We are delighted in securing the exploration licence in the diamondiferous BK16 kimberlite pipe. This development affords us an opportunity to accelerate our kimberlite exploration and evaluation efforts in the largest diamond-producing country by value in the world. There has been a growing trend in Botswana focusing on brownfields exploration where more modern evaluation techniques are being applied to previously discovered kimberlites. This has, in many cases, improved diamond grades, and coupled with increasing diamond prices, has resulted in projects now meeting the required hurdle rates. Botswana is renowned for its investor-friendly environment, and is also served by an excellent infrastructure making it one of the lowest-cost producers in the world."

BK16, which was discovered in 1970, is known to be diamondiferous and was originally modelled to be 3.5 hectares in size although later work has suggested that the surface area of the kimberlite could be bigger. BK16 is part of the Orapa kimberlite field in Botswana. The bedrock of the region is covered by a veneer of Kalahari group sediments and exposure is very poor. Rocks close to surface are often extensively calcretized and silcretized due to prolonged exposure on a late Cretaceous erosion surface (the African surface) which approximates to the present-day land surface. Previous work has indicated that the overburden over BK16 is 24 metres.

The Orapa kimberlite field lies on the northern edge of the Central Kalahari Karoo basin along which the Karoo succession dips very gently to the south-southwest and off-laps against the Precambrian rocks which occur at shallow depth within the Makgadikgadi depression.

The Orapa kimberlite field includes at least 83 kimberlite bodies, varying in size from insignificant dikes to the 110-hectare AK1 kimberlite which is Debswana's Orapa mine. All kimberlite intrusions are of post-Karoo age. Of the 83 known kimberlite bodies, nine -- AK1 (Orapa, Debswana); AK6 (Karowe, Lucara Diamond); BK1, BK9, BK12 and BK15 (Damtshaa, Debswana); DK1 and DK2 (Letlhakane, Debswana); and BK11 (Firestone Diamonds) -- have been or are currently being mined.

A bulk sample grade of 15 carats per hundred tonnes for BK16 was reported by Firestone Diamonds based on work previously performed. Diamonds recovered by the limited sampling carried out by Montgomery, SouthernEra Pty. Ltd., Firestone Diamonds and others have been predominantly high-quality white gemstones, with few industrial diamonds. This indicates that diamonds from BK16 are likely to have a high average value. The grade reported for BK16 is similar to that reported on work done on AK6 in the early 1990s (then 17 carats per hundred tonnes). A larger-scale bulk sampling program carried out on AK6 in 2005 by the De Beers/African Diamonds joint venture yielded a substantially higher grade of 24 carats per hundred tonnes. AK6 is known today as the Karowe mine and is operated by Lucara Diamond.

Evaluation plans

Tsodilo is planning an evaluation program that will include detailed geophysics and core drilling to more accurately establish the size and internal geology of the kimberlite. Dependent on the results of the diamond drilling which would include petrographic, mineral chemistry and microdiamond results, 24-inch large-diameter drilling would follow to recover a representative bulk samples from the different kimberlite phases in order to establish a grade and average diamond value with more confidence. The plan is to complete the first phase of bulk sampling in the first year.

Board members

The company owns 75 per cent of Bosoto with local partners holding the remaining 25 per cent. The board of Bosoto is composed of Mr. Bruchs, Mr. Cushing and Dr. de Wit on behalf of Tsodilo and recently appointed members, Blackie Marole and Johannes de Wet.

Mr. Marole is an economist by profession who has, over a period of 30 years, held various senior positions in the banking, government and mining sectors. He retired in 2010 after six years as managing director of the Debswana Diamond Company. While in government, Mr. Marole held the role of permanent secretary for seven years where he was responsible for the overall supervision of the formulation of policies, co-ordination and management of the affairs of the Ministry for Minerals, Energy and Water Resources. He currently serves as chairman of Botswana Development Corp. and African Energy Botswana Pty. Ltd. He was chairman of Barclays Bank of Botswana and Botswana Diamond Valuing Company, a director of DeBeers, the Diamond Trading Company, BCL and CIC Energy Corp., and the former chairman of Botswana Power Corp. and Water Utilities Corp. He has also served as the chairman of the Privatization and Outsourcing Agency of Botswana.

Mr. de Wet serves as the technical director of DeWetDrilling and various other companies in the DeWetDrilling Group of Companies. He has gained vast experience in the field of most drilling disciplines over a period of 25 years in Southern Africa. Of particular importance is his expertise in diamond exploration and bulk sample drilling operations. He was the designer and manufacturer of the renowned Elephant mobile drill rig deployed in large-diameter fluid reverse circulation kimberlite bulk sampling operations all over Southern Africa during the past decade. Mr. de Wet is also the chief technical officer of Bauer De Wet Equipment Pty. Ltd., where he was tasked with the conceptualization, design and manufacture of the 90-tonne Buffalo multipurpose drill rig primarily developed for the shallow onshore oil and gas market as well as the Rhino 1300 range of tracked blast hole drill rigs. The Buffalo 90 is capable to satisfy directional drilling requirements down to 2,000 metres.

Overall supervision of the company's exploration program is the responsibility of Dr. de Wit, a qualified person as such term is defined in National Instrument 43-101. Dr. de Wit has reviewed the information contained herein and approved the contents of this press release.

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