2010 Tania R Marshall Explorations Unlimited Glenn A Norton Rockwell Diamonds Inc REVISED TECHNICAL REPORT ON THE WOUTERSPAN ALLUVIAL DIAMOND PROJECT, HERBERT DISTRICT, SOUTH AFRICA FOR ROCKWELL DIAMONDS INC Effective Date: 30 November, 2010 Signature Date: 30 May2011 Revision Date 25 July 2011 ROCKWELL DIAMONDS INC, WOUTERSPAN PROJECT November 30, 2010 Table of Contents Page 1 INTRODUCTION ........................................................................................................................................... 13 1.1 TERMS OF REFERENCE AND SCOPE OF WORK ....................................................................................................... 13 1.2 SOURCES OF INFORMATION .............................................................................................................................. 15 1.3 UNITS AND CURRENCY .................................................................................................................................... 16 1.4 FIELD INVOLVEMENT OF QUALIFIED PERSON ........................................................................................................ 16 1.5 USE OF DATA ................................................................................................................................................ 16 2 RELIANCE ON OTHER EXPERTS ..................................................................................................................... 18 2.1 LEGAL OPINION ............................................................................................................................................. 18 2.2 DIAMOND VALUATION .................................................................................................................................... 18 3 PROPERTY DESCRIPTION AND LOCATION .................................................................................................... 20 3.1 PROPERTY DESCRIPTION AND LOCATION .............................................................................................................. 20 3.2 PERMITS CONTRACTS AND AGREEMENTS ............................................................................................................. 22 3.2.1 The Wouterspan project ....................................................................................................................... 22 3.2.2 Surface ownership / land use rights ...................................................................................................... 22 3.2.3 Mineral rights (Mining/Prospecting Rights, permits, etc) ..................................................................... 22 3.2.3.1 Royalty Payments .......................................................................................................................................... 23 3.3 BEE COMPLIANCE .......................................................................................................................................... 23 3.4 ENVIRONMENTAL ........................................................................................................................................... 24 3.4.1 Water Permits ....................................................................................................................................... 24 3.4.2 Environmental and Rehabilitation ........................................................................................................ 24 3.4.3 ................................................................................................................................................................... 25 3.4.4 Mine closure .......................................................................................................................................... 25 3.5 SOCIAL RESPONSIBILITY ................................................................................................................................... 25 3.5.1 Social and Labour Plans ........................................................................................................................ 26 4 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY .............................. 27 4.1 TOPOGRAPHY, ELEVATION AND VEGETATION ........................................................................................................ 27 4.2 ACCESS AND INFRASTRUCTURE .......................................................................................................................... 28 4.3 CLIMATE ....................................................................................................................................................... 29 5 HISTORY ...................................................................................................................................................... 30 5.1 PREVIOUS OWNERSHIP .................................................................................................................................... 31 5.2 PREVIOUS EXPLORATION/DEVELOPMENT ............................................................................................................ 31 5.2.1 Historic .................................................................................................................................................. 31 6 GEOLOGICAL SETTING ................................................................................................................................. 33 6.1 GENERAL GEOLOGY AND MINERAL DEPOSITS OF SOUTH AFRICA ............................................................................. 33 6.2 THE ALLUVIAL DIAMOND FIELDS OF THE MIDDLE ORANGE RIVER ............................................................................ 34 6.3 PROPERTY GEOLOGY ....................................................................................................................................... 34 7 DEPOSIT TYPES ............................................................................................................................................ 40 7.1 PRIMARY FLUVIAL-ALLUVIAL GRAVEL DEPOSITS .................................................................................................... 40 7.2 DEFLATION OR ‘ROOIKOPPIE’ DEPOSITS .............................................................................................................. 41 7.2.1.1 Eluvial Rooikoppie Gravel ............................................................................................................................. 42 7.2.1.2 Colluvial Rooikoppie Gravel .......................................................................................................................... 43 8 MINERALIZATION ........................................................................................................................................ 45 8.1 NATURE OF MINERALISATION ........................................................................................................................... 45 8.2 SURROUNDING ROCK TYPES ............................................................................................................................. 49 8.3 GEOLOGICAL CONTROLS .................................................................................................................................. 50 8.4 MINERALISATION ON WOUTERSPAN .................................................................................................................. 53 9 EXPLORATION ............................................................................................................................................. 54 EXPLORATIONS UNLIMITED Page 2 ROCKWELL DIAMONDS INC, WOUTERSPAN PROJECT November 30, 2010 10 DRILLING ..................................................................................................................................................... 55 10.1 LOCATION ..................................................................................................................................................... 55 10.2 RESULTS ....................................................................................................................................................... 60 10.3 REPRESENTATIVENESS ..................................................................................................................................... 60 11 SAMPLING METHOD AND APPROACH ......................................................................................................... 61 11.1 LOCATION ..................................................................................................................................................... 61 11.1.1 Diamond Grade Estimation .............................................................................................................. 64 11.1.2 Diamond Value Estimation ............................................................................................................... 64 11.1.2.1 Diamond Size Distribution............................................................................................................................. 64 11.1.2.2 Diamond Sales............................................................................................................................................... 66 11.2 MINING AND PROCESSING OF SAMPLES .............................................................................................................. 67 11.2.1 Mining/Excavation Methodology ....................................................................................................