PROGRESS UPDATE ON STRATEGY AND FUTURE PLANS JAMES CAMPBELL, CHIEF - PowerPoint PPT Presentation

PROGRESS UPDATE ON STRATEGY AND FUTURE PLANS JAMES CAMPBELL, CHIEF EXECUTIVE OFFICER MARCH 2012

2 AGENDA UNIQUE investment proposition • Corporate OVERVIEW • DIAMOND MARKET fundamentals • Progress with top STRATEGIC PRIORITIES • CASHFLOW and INVESTMENTS • Operational TARGETS for fiscal 2013 • VALUATION considerations • GROWTH plan and strategy • Sustainable DEVELOPMENT • PRIORITIES and OUTLOOK for fourth quarter 42.50 carat Type 2a from Saxendrift • (May 2011) FOCUS ON DIAMOND VALUE MANAGEMENT

3 A UNIQUE INVESTMENT PROPOSITION… Established diamond producer Ÿ Well-understood geology Ÿ Beneficiation partnership • Pipeline of projects to SUSTAIN and GROW production profile • Resources and reserve estimates STATED PER NI 43-101 • Experienced executive leadership and strong board of directors to DRIVE VALUE CREATION • Value adding BENEFICIATION partnership Turnaround in progress Ÿ Milestones towards executing strategic objectives • ENHANCING management and SKILLS base to unlock value and grow profitability • CONSOLIDATING Holpan and Klipdam to profitably process remaining deposits Improve profitability at Saxendrift with FIT - FOR - PURPOSE in-field screen • Establish LONG - LIFE OPERATION at Tirisano • Appropriate technology underpinning DIAMOND VALUE MANAGEMENT focus e.g. bulk X-ray at Saxendrift • Significant value gap FOCUS ON DIAMOND VALUE MANAGEMENT

4 BENEFICIATION JOINT VENTURE: SIGNIFICANT VALUE ADD BENEFICIATION ROUGH POLISHED VALUE ADD 35 ct D color internally 105 ct Type II A, + 62 % on initial rough flawless Middle Orange sale price Sold for $230,000/ct 212 ct yellow, + 50 % on initial rough 102 ct vivid yellow Middle Orange sale price 128 ct yellow, 81 ct vivid yellow Not yet sold Middle Orange Steinmetz Diamond Group (SDG) profit share agreement (>2.8 carat stones) • MARKET RELATED PRICES for diamonds sold into JV + 50% profit share • Realized revenue of $8.5m in last 3 years from 6,182 carats beneficiated ($5.5m F2012 YTD) • ±25% of revenue from beneficiation, expected to increase FOCUS ON DIAMOND VALUE MANAGEMENT

5 ROCKWELL ROUGH DIAMOND PRODUCTION: AVERAGE US$/CARAT World Diamond Average Small diamonds used in lower $90/carat price point and pavé jewellery <0.3 c/stone # Tirisano (North West Province, RSA) Engagement rings (Bridal-range), mid to high price point jewellery $700/carat ~0.9 c/stone # Klipdam (Vaal River, RSA) Engagement rings, high price point $1,100 /carat jewellery ~1.2 c/stone # Saxendrift* /Wouterspan/Niewejaarskraal High-end luxury jewellery (Middle Orange River, RSA) High Net Worth Individuals $2,000/carat Investment Stones ~2.5 c/stone # # - Rough stone average sizes * - Before increasing the bottom cut off to 5mm FOCUS ON DIAMOND VALUE MANAGEMENT

6 ROCKWELL OPERATIONS AND PROJECT LOCALITIES: NORTHERN CAPE AND NORTH WEST PROVINCES, SOUTH AFRICA FOCUS ON DIAMOND VALUE MANAGEMENT

7 EXTENSIVE DEPOSITS TO BENEFIT FROM DIAMOND FUNDAMENTALS Sales and revenue statistics for +2ct rough diamonds Saxendrift: Average quarterly price per carat 100% $3,500 US $/ct Linear (US $/ct) % of carats exceeding 2 cts 90% $3,000 80% % of revenue exceeding 2cts $2,500 70% 60% $2,000 50% $1,500 40% 30% $1,000 Recession 20% $500 impact 10% $0 0% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Saxendrift Klipdam Tirisano F2009 F2010 F2011 F2012 Sale of parcels to State Diamond Trader Volume (m 3 ) See slide 24 for for detailed 43-101 Mineral Reserves & Resources: At 28 Carats Value (USD) Category February 2011. millions Feb 28 2011 Estimates completed by Rockwell’s Manager, Resources, G.A. Norton, (Pr. Sci. Nat.), a qualified person who is not independent of the Company. Probable reserves 46.3 4,565,400 22,827 Reviewed by T.R. Marshall, PhD, (Pr. Sci. Nat.), Marshall, an independent qualified person Indicated resources 489.6 34,787,600 675,412 Inferred resources 1,141.1 82,062,000 828,641 1,677.0 FOCUS ON DIAMOND VALUE MANAGEMENT

8 LEADERSHIP TEAM WITH CREDENTIALS TO DELIVER VALUE Board of Directors: Mark Bristow (Chairman) CFO Dave Copeland Gerhard Jacobs, BAcc, MBA Richard Linnell Willem Jacobs Sandile Zungu Mining and corporate experience with Johan van’t Hof Group Technical junior and senior mining companies Manager with operations in SA, Australia and Glenn Norton, Canada. Knowledge of public listed BSC (Hons) mining Companies. Geological, mineral resource President and CEO management and production COO James Campbell, experience in alluvial diamond deposits, Michael Hunt, BSc (Hons ) ARSM, MSc (Advanced Chemical diamond and coal exploration. Qualified MBA (Dunelm) Engineering) person and Pr.Sci.Nat. Seasoned diamond executive with >30 yrs in diamonds incl. mgt. roles at career spanning over 20 years at Orapa (world’s largest diamond mine) Diamond Marketing & Sales Manager De Beers and 4 years as Managing & The Oaks (De Beers’ smallest Jeffrey Brenner Director of African Diamonds plc. mine). Operations Manager at Pangea FIMMM, C.Eng, C.Sci and Pr.Sci.Nat. DiamondFields plc from 2007. A leading international diamantaire Group HR/IR Manager and specialist in valuation, marketing Richard Mhlonto, and sales of rough diamond Nat Dip (HR Management production from alluvial deposits. & Development) Extensive HR & Industrial Relations management experience including organizational and structural design initiatives as well as strategy development and implementation. FOCUS ON DIAMOND VALUE MANAGEMENT

9 CAPITAL STRUCTURE AND SHAREHOLDING Top shareholders (% shares in issue) Number of shares Strategic: Daboll (Steinmetz) 21.3% • Shares outstanding 47,942,746 Godia Capital 8.3% • Middle East Investors 7.1% • Warrants - Institutional: Conus Partners 6.9% • Options ($0.90-9.45) 2,121,931 Earth Resources (ERIG) 3.6% • Craton Capital 2.6% • Convertible Debt (~$0.56) 3,499,257 Wells Capital 1.6% • Other: Fully Diluted 53,563,934 Etruscan 2.6% • Mark Bristow 1.2% • FOCUS ON DIAMOND VALUE MANAGEMENT

10 STRONG FUNDAMENTALS FOR DIAMOND SECTOR Diamond DEMAND in carats forecast to grow at 6% p.a. to 2020 • – OUTPACING annual SUPPLY growth of 2.8% – SHORTAGES , particularly in large carat diamond segments CHINESE and INDIAN MIDDLE CLASS to double by 2020 • – Driving demand surge Combined market share predicted to EQUAL US market – Source: PolishedPrices.com share of 30% by 2020 Growing SCARCITY of +2CT diamonds • Currently represents 5% of diamond PRODUCTION and – 50% of sales VALUE for producers Source: Deutsche Bank / Alrosa FOCUS ON DIAMOND VALUE MANAGEMENT

11 PROGRESS WITH TOP STRATEGIC PRIORITIES ENTRENCHING DIAMOND VALUE MANAGEMENT Board of directors STRENGTHENED Tirisano ACQUISITION closed out Constructive PROGRESS with resolution of BEE matters CORPORATE FINALIZATION of Midamines legacy issue Strategic review of project opportunities for EFFECTIVE CAPITAL ALLOCATION REORGANIZATION of senior mine MANAGEMENT teams Production RAMP - UP COMMENCED at Tirisano after addressing fatal flaws OPERATIONAL Production STABILIZING at Saxendrift $7.8m RAISED at $0.75 without warrants or other incentives DISPOSAL of non-core assets generated further $6.4m FINANCIAL Gross PROFIT of $0.5m in Q3 (Impact of Tirisano start up and Midamines) NET CASH holdings of $10.8m at end of Q3 Implementation of in-field screen at Saxendrift COMPLETED Proof of concept commissioning of bulk X-ray technology ON TRACK TECHNOLOGY Relocation of CONTAINERIZED RECOVERY from Holpan (on care & maintenance) to Tirisano FOCUS ON DIAMOND VALUE MANAGEMENT

$m CASHFLOW: INVESTING IN CAPACITY FOR GROWTH $10 $15 $20 $25 $5 $- Opening cash and cash equivalents BALANCE SHEET PROVIDES REQUIRED WORKING CAPITAL TO Cash Generated ACHIEVE SHORT TO MEDIUM TERM OBJECTIVES by Operations Net changes in working capital Proceeds of Private Placement Proceeds of convertible bond Proceeds from sale of assets Capex: Tirisano, Saxendrift and purchase of mineral property interests Movement in FOCUS ON DIAMOND VALUE MANAGEMENT reclamation deposits Other cash flows Closing cash and cash equivalents 12

13 OPERATIONAL TARGETS FOR FISCAL 2013 CASH OPERATING COST/m 3 PRODUCTION GRADE CAPITAL REVENUE/CARAT MINE (m 3 ) (carats/100m 3 ) EXPENDITURE (US$) BUDGET F2012 YTD At name plate In line with F2012 KLIPDAM Stable $7.32* $10.35 Minimal capacity (90 000) YTD Increase to 150 In line with two year 000 with new in- SAXENDRIFT Stable $8.42 $8.35 $400,000 average field screen Ramping up to Gradual In line with stated 90,000m 3 p.m. improvement to TIRISANO $10.38** $16.84 $750,000 prices of $700 06/2012 1.8 by 06/12 - ZAR/CAD exchange rate of 8.00 - Full implementation of contops at all operations for F2013 - Corporate expenses budgeted to remain stable - Beneficiation (stones > 2.8 carats) not included in average price per carat expectation * Change of mining plan ** Ramp-up FOCUS ON DIAMOND VALUE MANAGEMENT