Vaaldiam Mining Inc. is preparing to restart diamond production at the Duas Barras mine in Minas Gerais, Brazil with production expected by Q3, 2010. The mine contains National Instrument 43-101 indicated resources of 1,530,800 cubic meters of gravel at an average grade of 0.16 carats of diamonds per cubic meter and 0.18 grams gold per cubic meter, and inferred resources of 810,000 cubic meters of gravel at an average grade of 0.16 carats per cubic meter and 0.18 grams of gold per cubic meter.

The mine is expected to generate immediate and self-sustaining cash flow for Vaaldiam from the sale of diamonds and gold. Prior to the financial crisis the Duas Barras mine achieved average rough diamond sales values of US$165 per carat. Operating costs are expected to average US$85 per carat.

Vaaldiam’s Brazil-focused strategy is to use cash flow from its alluvial diamond and gold production to finance hard-rock exploration for both diamonds and gold while disposing of non-core assets in Kenya and Canada.

The Company is also evaluating its Chapada diamond mine near Cuiaba in Mato Grosso, Brazil with regard to either restarting production in 2011 or selling the asset. Chapada historically produced large, high quality diamonds that prior to the suspension of mining activity in July 2008 achieved average sales values of US$490 per carat.

Robert Jackson, CEO, said “These two mines and their surrounding regions should make Vaaldiam self-supporting with the potential to increase resources and production. The Brauna and Catalao kimberlite diamond projects offer substantial exploration upside.”