Motapa Diamonds Inc.
TSX VENTURE : MTP

Motapa Diamonds Inc.

January 26, 2007 09:00 ET

Motapa Third Quarter Financial Statements and Interim MD&A

NORTH VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 26, 2007) - Motapa Diamonds Inc. (TSX VENTURE:MTP) has filed its interim consolidated financial statements and its Management Discussion and Analysis for the 9 months ended November 30, 2006, with the regulatory authorities through SEDAR. The interim consolidated financial statements were prepared by management in accordance with Canadian generally accepted accounting principles and were not reviewed by Motapa's auditors.

Overview

Highlights of Motapa's exploration activities during its third quarter of fiscal 2007 are:

- Preparatory work for the evaluation of the Mothae kimberlite continued this quarter. This included completion of access road construction, continued site development work, scoping and design of a processing plant suitable for processing the planned Mothae bulk sample, completion of ground geophysical surveys and a substantial pitting program. The pitting program provided key information on overburden conditions and kimberlite variability, and provided sample material for indicator-mineral and microdiamond analysis. The ground geophysical surveys provide a clear indication of the outline of the Mothae kimberlite and an indication of internal phase variability.

- Namdeb (50% owned by DeBeers Centenary AG and 50% by the Government of the Republic of Namibia) completed its due diligence investigation of the Kavango project, including a detailed review and interpretation of Motapa's data and a magneto-telluric geophysical survey over the license area to define the location of the craton margin, and subsequently exercised its option to form a joint venture on this project. Namdeb and Motapa are finalising plans for the next 2-year work program which will be sole funded by Namdeb.

- Stornoway Diamond Corporation completed ground magnetic surveys over 28 moderate and high-interest gravity and magnetic anomalies identified from the Sua Pan Falcon airborne survey.

- Final results from the heavy mineral sampling program carried out over the Lebiri project in Gabon confirm that abundant visually high-interest chromites were recovered downstream of some of the aero-magnetic anomalies that were the target of the sampling program. These recoveries were from relatively small, well-constrained catchment areas, providing encouraging signs of local kimberlitic sources.

- The Company also relinquished further ground in Botswana that was deemed to be no longer of continuing interest.

Cash and cash equivalents decreased by $776,270 during the quarter ended November 30, 2006 (decrease in 2005: $513,452) to $3,994,140 (2005: $5,375,083) as a result of operational expenditure. Interest income increased slightly to $36,410 (2005: $30,463) and a foreign exchange loss of $118,368 was recorded (2005: gain of $87,999) in line with the US dollar/Canadian dollar exchange rate, interest rates and average cash balance holdings for the period.

Corporate expenditure for the quarter ended November 30, 2006 decreased to $230,541 compared to $379,091 in the comparative period. The decrease is attributable to the incentive stock option expense of $181,734 in the comparative period as compared to the current period expense of $25,137.

Exploration expenditure totalled $628,847 (2005: $740,106), with the largest expenditure of $281,904 (2005: $nil) occurring in Lesotho on preparatory work for the evaluation of the Mothae kimberlite. In Gabon, a total of $157,568 (2005: $52,120) was attributable to follow-up geochemical sampling activities over aero-magnetic targets, and in Mozambique, orientation sampling accounted for expenditures of $79,107 (2005: $nil).

On behalf of the Board

MOTAPA DIAMONDS INC.

Dr. Larry Ott, Chief Executive Officer

This news release may contain assumptions, estimates, and other forward-looking statements regarding future events. Such forward-looking statements involve inherent risks and uncertainties and are subject to factors, many of which are beyond the Company's control that may cause actual results or performance to differ materially from those currently anticipated in such statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

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