TORONTO, ONTARIO--(Marketwire - April 7, 2011) - Vaaldiam Mining Inc. ('Vaaldiam' or 'the Company') (News - Market indicators) is pleased to report a positive Preliminary Assessment ('PA') for the Braúna 3 Diamond Project ('B3'), located at its 5,000 hectare Braúna kimberlite diamond property ('the property') in the State of Bahia, Brazil. Vaaldiam reported on March 4, 2011 that it has entered into an agreement to increase its interest in the property from 20% to 51%. The property has excellent infrastructure and good exploration potential: it contains 22 known kimberlites, including B3, of which Vaaldiam has tested nine, all of which contained diamonds. Bahia is an economically under-developed state with government incentives for investors.

The B3 PA includes a conceptual open pit mine plan, processing plant design, environmental aspects, capital and operating cost estimates, and project cash flow models prepared by Coffey Consultoria e Serviços Ltda. ("Coffey"), a subsidiary of Coffey Mining and Coffey International Limited of Australia. The conceptual open pit mine plan is based upon a National Instrument 43- 101 ('NI43-101') compliant Mineral Resource estimate prepared by A.C.A. Howe International Limited ('Howe'), as reported by Vaaldiam on January 20, 2011, and a modified NI43-101 Mineral Resource prepared by Coffey as part of the PA.

Vaaldiam CEO Robert Jackson said "This PA confirms our belief that B3 is a low cost, high return kimberlite diamond project that compares extremely well with high cost development projects in Canada, for example. We are pleased with the PA and hope that we can improve on its initial economic assumptions by using a combination of our existing equipment and attractive equipment financing terms. This initial analysis excludes any potential deeper than 200 metres at B3, or from other nearby kimberlites, and we believe that this initial B3 open pit is only the beginning and that there is significant blue sky potential at the other nearby kimberlites and at depth at B3. We are working to convert that potential into reality."

Highlights of the study, for 100% of the project on an equity basis, are as follows:

• Using a 10% discount rate and an independent diamond value of US$338/carat:
  • Base case pre-tax Net Present Value ('NPV') of US$33.6 million and Internal Rate of Return ('IRR') of 42%, using Coffey's NI43-101 Mineral Resource with base case diamond grade of 16.8 carats per 100 tonnes ('cpht'); and
  • Second scenario pre-tax NPV of US$101.0 million and IRR of 107% using the Howe NI43-101 Mineral Resource diamond grade of 24.58 cpht.
• A conceptual open pit mine life of 5 years based on a production rate of 720,000 t/year, waste stripping ratio of 4.45 and a total open pit diamond production of 573,000 carats for Coffey's Mineral Resource and 839,000 carats for Howe's Mineral Resource. This excludes any potential below 200 metres at B3 or from other nearby kimberlites.
• Project capital cost of US$25 million (including 15% contingency) and average open pit life of mine operating cost of US$31/t run of mine production ('ROM') in a conceptual mine plan using open pit mining to a depth of approximately 200 metres below surface.

B3 Resources – Howe

Vaaldiam reported on January 20, 2011 that Howe prepared an initial NI43-101 Mineral Resource and defined Indicated Resources to a depth of approximately 40 metres of 0.63 million tonnes at a grade of 24.58 cpht in the South Lobe, and 0.67 million tonnes at a grade of 4.72 cpht in the North Lobe of the B3 kimberlite. Howe also reported Inferred Resources to a depth of approximately 200 metres containing 3.75 million tonnes at a grade of 24.6 cpht in the South Lobe and 1.04 million tonnes at a grade of 4.7 cpht in the North Lobe, at diamond valuations of US$338/carat and US$100/carat respectively.

B3 Resources – Coffey

Coffey reviewed the Howe Mineral Resource Statement and adjusted the diamond grade so that it is based on volume (ct/100m³) using density data acquired from the surface bulk samples and drilling programs, to account for a difference in density between the saprolitic samples excavated at surface and the harder, fresh kimberlite at depth. Coffey estimated an average resource diamond grade of 16.8 cpht for their base case scenario for the South Lobe of the B3 kimberlite, and a diamond valuation of US$338/carat. Coffey did not consider the North Lobe in the PA because the diamond grade based on the surface sampling completed to date was too low to be declared a Resource at a value of US$100/carat.

Preliminary Assessment

Coffey prepared a conceptual mine plan, process plant design, capital cost and operating cost parameters, and a preliminary economic assessment based on the mineral resource block model prepared by Howe. Coffey based their economic assessment on two open pit mining scenarios focused only on the South Lobe of the B3 kimberlite. Coffey's 'Base Case' scenario is based on 3.49 million tonnes ('Mt') of Coffey's Mineral Resource. The Base Case financial model uses a diamond price of US$338/ct, which is the average value of 1,013.75 carats of diamonds recovered from the South Lobe of B3, independently valued by Diamond Counsellors International of London, U.K. and International Economic Strategies of Antwerp, Belgium in November 2010 (as reported by Vaaldiam on December 2, 2010).

The second scenario prepared by Coffey is based on 3.49Mt of Howe's South Lobe Mineral Resource.

Conceptual Mine Plan

The conceptual mine plan envisions open pit mining of the South Lobe of the B3 kimberlite to a depth of approximately 200 metres. The mining sequence and design was determined by optimizing the pit depth to achieve a production rate of 720,000 t/year to support a processing rate of 100 t/hr. The pit designs were finalized using the Whittle pit optimization software on both the Coffey Base Case and Howe Resource models, with a stripping ratio of 4.45:1. The plan assumes that contract mining will be employed for all mining operations.

Diamond Processing Plant

Coffey proposed a diamond processing plant capable of processing 720,000 t/year of kimberlite ore. Ore preparation will include initial jaw and cone crushing followed by tertiary crushing, scrubbing and screening with vibrating screens. Ore is concentrated in a Dense Media Separation plant and the diamonds separated from the heavy mineral concentrate using X-ray sorting and grease-table technology. Diamond recovery is estimated at 98% of the resource grade based on a bottom screen size cut-off of 1.0mm, and an upper-screen size cut-off of 30mm to allow the recovery of large diamonds.

Capital Cost

Coffey has estimated a capital cost, for the mining, diamond processing plant and infrastructure of US$25 million, including a 15% contingency. It is envisioned that contractors will be used for site infrastructure construction. Coffey based its estimate of the capital cost on factored costs from previous project equipment capital cost information.

Operating Cost

Coffey has considered a processing rate of 720,000 t/year ROM and an average waste stripping ratio of 4.45:1. The mining operation is envisioned to mine and transport an average of 3.9Mt per annum ('Mtpa') ore and waste and a total of 19.0Mt over the expected 5-year open pit life of mine, excluding any potential below 200 metres and from other nearby kimberlites.

Coffey's base case operating costs have been derived from first principles and from reference to contract mining costs at comparable-sized mining operations in Brazil. In summary, mining costs are estimated at US$4.25/t mined. Costs for processing and general and admnistration are estimated at US$6.23/t and US$1.72/t respectively.

Project Overview

The two-hectare B3 pipe is open vertically and laterally and is located in easily accessible terrain just 7 km south of the town of Nordestina. Nordestina has excellent infrastructure, grid power, services and a pool of skilled labour.

Vaaldiam has performed exploration work elsewhere on the property, including the Braúna 8 ('B8') kimberlite dike situated 5 km north of the B3 pipe. Mini-bulk samples from this 4.5 metre-wide dike produced 170 diamonds weighing 19.37 carats, including a 7.97 carat white octahedron stone, from approximately 46 dry tonnes, inferring a recovered grade of 42 cpht. The B8 occurrence is a vertically oriented kimberlite dike forming a 1,000 metre-long section of the northwest trending dike system. Recent exploration conducted in the vicinity of the B8 dike has confirmed that this dike is linked to the Braúna 21 occurrence. Mini-bulk sampling of the one hectare Braúna 7 pipe, situated 1 km to the east of the B3 pipe, resulted in the recovery of 30 diamonds with a total weight of 3.87 carats from approximately 87 tonnes of kimberlite with an estimated recovered diamond grade of 4.5 cpht.

Vaaldiam commissioned the B3 PA pursuant to its obligation under NI 43-101 to prepare and file technical reports and as such, the PA is the sole responsibility of Vaaldiam.

This release has been reviewed by Norman Lock (BSc, PhD, CGeol FGS, PrSciNat) who is a qualified person under NI 43-101.

Certain of the information contained in this news release constitutes 'forward-looking statements' within the meaning of securities laws. Such forward-looking statements, including but not limited to those with respect to the prices of metals and minerals, purchase payments, royalty payments, estimated future production and estimated costs of future production involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any forecast results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the actual prices of metals and minerals, the actual results of current exploration, development and mining activities, changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the documents of the Company filed from time to time with the Ontario Securities Commission.