DIAMOND RECOVERY PROCEEDING ON SCHEDULE.

TORONTO--(BUSINESS WIRE)--Aug. 3, 1995--UNITED REEF LIMITED(TSE: URP) United Reef Limited said today that operations at the new diamond recovery plant on its Bamingui River diamond property in the Central African Republic are proceeding on schedule. The plant was officially opened on June 9th and began processing diamond bearing gravels on June 10th. The plant recovered 185.9 carats in June and increased recoveries during July to 332.4 carats. The plant operated on 17 days in June and 25 days during July. By mid-July sufficient staff had been trained to commence operating the plant for two shifts per day and the plant is now operating thirteen hours per day. During the last two weeks of July the plant sustained average hourly throughput of 30 tonnes of gravel per hour, the plant's rated operating capacity.

The first seven weeks of operation provided interesting statistical information when compared to data collected from the 1993 and 1994 exploration programs. A total of 1,202 individual diamonds were recovered during June and July with a combined weight of 518.31 carats. This results in an average stone size of .43 carats, a significant increase from the 1993/1994 sampling results. In addition, the largest stone recovered during our sampling programs weighed 5.3 carats. During June and July the new plant recovered 3 large gem quality diamonds weighing 6.24, 7.32 and 9.70 carats, respectively. These encouraging new results are likely directly related to the efficiency of the new plant. A variety of 1 to 5 carat gem quality diamonds were also recovered from this production. Mining operations and grade control have been somewhat hampered by the rainy season, but continue to show improvement as the equipment operators have gained additional experience. We anticipate continuing improvement in tonnage throughput, diamond recovery and plant efficiency as additional modifications to feed and scrubbing circuits are implemented.

The first sale of production from the property is scheduled for September.

Ongoing exploration in the Bamingui River drainage continues to identify additional gravel resources. More than 340 reverse circulation drill holes were completed prior to the end of July in this area. Recently the 10 TPH mobile sampling plant has begun processing bulk samples.

CONTACT: Michael D. Coulter, 416/368-0993