VANCOUVER, December 3, 2012 /PRNewswire/ --

Rockwell Diamonds Inc. ("Rockwell" or the "Company") (TSX: RDI; JSE: RDI) updates the market on its pilot Bulk X-Ray project at the Saxendrift Mine. Despite this project being a pilot study it has already repaid the cost of setting it up from processing the old recovery tailings.

The Bulk X-Ray project was initiated in November 2011 and commissioned ahead of schedule, five months later with a capital outlay some 7% lower than the initial budget of $1.5 million. During the six month period to date, a total of 1,596 carats have been recovered from reprocessing 27,609 m^[3] of old recovery tailings that had previously been processed by another operator using older technologies. These included three particularly large stones weighing 52, 72 and 145 carats respectively. In addition to a capital investment of $1.4 million, operating costs of $0.39 million were incurred, with revenue from sales of the diamonds recovered totalling US$4.2 million over the period to October 31, 2012.

The recovery tailings achieved a grade of 2.97 carats/100 m^[3]. The recovery of diamonds from these tailings suggests that the deployment of this technology in run-of-mine applications across Rockwell's Middle Orange River projects should yield additional recoveries beyond the stated grades and diamond values which have been identified using historical technology. There is the added benefit that the new high throughput technology can also lead to a meaningful reduction in operating costs.

"We are delighted that our initial capital outlay was paid back and believe this technology will become an integral component in our total diamond value management strategy," explains James Campbell, CEO, Rockwell Diamonds. "The work represents the opportunity for a step change in Rockwell's approach to diamond recovery, enabling a quicker payback than any other type of recovery plant. Particularly noteworthy is the fact that we achieved this only from material that had been processed previously. We have yet to deploy the technology in a run of mine application."

"Having completed the six-month pilot study, we have satisfactorily completed our proof of concept for the Bulk X-Ray technology, with its dual benefits of more efficient recovery of diamonds and lower operating costs," added Campbell. "Our projects team has also demonstrated its capability to replicate the system on other operations. The next phase is to roll out the technology at the new Saxendrift Hill Complex mine where the processing plant will be based on two Bulk X-Ray systems at a monthly processing rate of 100,000 m^[3]. Production is on track to commence early in the next fiscal year with an expected total capital outlay of about $2 million to be funded from working capital."

About Rockwell Diamonds:

Rockwell is engaged in the business of operating and developing alluvial diamond deposits, with a goal to become a mid-tier diamond production company.  The Company has three existing operations, which it is progressively optimizing, two development projects and a pipeline of earlier stage properties with future development potential.

Rockwell also evaluates merger and acquisition opportunities which have the potential to expand its mineral resources and production profile and would provide accretive value to the Company.

No regulatory authority has approved or disapproved the information contained in this news release.

Forward Looking Statements

Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities law. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements.

Factors that could cause actual results to differ materially from those in forward-looking statements include uncertainties and costs related to exploration and development activities, such as those related to determining whether mineral resources exist on a property; uncertainties related to expected production rates, timing of production and cash and total costs of production and milling; uncertainties related to the ability to obtain necessary licenses, permits, electricity, surface rights and title for development projects; operating and technical difficulties in connection with mining development activities; uncertainties related to the accuracy of our mineral resource estimates and our estimates of future production and future cash and total costs of production and diminishing quantities or grades of mineral resources; uncertainties related to unexpected judicial or regulatory procedures or changes in, and the effects of, the laws, regulations and government policies affecting our mining operations; changes in general economic conditions, the financial markets and the demand and market price for mineral commodities such as diesel fuel, steel, concrete, electricity, and other forms of energy, mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the US dollar, Canadian dollar and South African Rand; changes in accounting policies and methods that we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates; environmental issues and liabilities associated with mining and processing; geopolitical uncertainty and political and economic instability in countries in which we operate; and labour strikes, work stoppages, or other interruptions to, or difficulties in, the employment of labour in markets in which we operate our mines, or environmental hazards, industrial accidents or other events or occurrences, including third party interference that interrupt operation of our mines or development projects.

For further information on Rockwell, Investors should review Rockwell's home jurisdiction filings that are available at http://www.sedar.com.

For further information on Rockwell and its operations in South Africa, please contact:

James Campbell
CEO
+27(0)83-457-3724
Stéphanie Leclercq
Investor Relations
+27(0)83-307-7587

(RDI. RDIAF)

SOURCE Rockwell Diamonds Inc.