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 Tue Feb 27, 2007
US$1.5 Million Credit Facility Transaction and Consolidation of Debt

 Cape Town, February 27, 2007 - Diamond Fields International Ltd. (DFI:TSX) ("DFI" or the "Company") is pleased to announce that it has entered into a credit facility agreement (the "Credit Facility Agreement") with Spirit Resources SARL ("Spirit") providing for a loan by Spirit of US$1.5 million to assist the Company with its existing and anticipated future working capital requirements. Spirit is controlled by Mr. Jean-Raymond Boulle who beneficially owns, directly or indirectly, an aggregate of 38,174,305 common shares of DFI representing approximately 27% of DFI's issued and outstanding shares.

As detailed in DFI's continuous disclosure filings with Canadian securities regulators (including the Company's Rights Offering Circular dated December 14, 2006), the Company is indebted to Spirit pursuant to a promissory note issued by the Company dated June 9, 2004, as amended (the "2004 Note"). As of February 15, 2007, an aggregate of US$2,298,689.26 in outstanding principal and accrued and unpaid interest was due to Spirit under the 2004 Note (the "2004 Note Amount"). Pursuant to the terms of the 2004 Note (and as approved by the shareholders of DFI at its annual general meeting held on November 16, 2005), the 2004 Note Amount is convertible, in whole or in part at the election of Spirit, into common shares of DFI at the price of C$0.25 per share.

As previously announced, by letter agreement dated June 2, 2005 Spirit agreed to postpone repayment of the amount owing under the 2004 Note and DFI agreed to secure such amount by all of DFI's and its subsidiaries' property and assets.

The Credit Facility Agreement, in addition to providing a loan in the amount of US$1.5 million to DFI for its working capital purposes, consolidates all of DFI's prior debt to Spirit (consisting of the 2004 Note Amount and other debt in the aggregate amount of US$182,944.86 as reported in the Company's financial statements) for an aggregate principal amount of US$3,981,634.12 owing under the Credit Facility Agreement (the "Principal"). Effective February 20, 2007, such Principal will accrue interest under the Credit Facility Agreement at the rate of 10% per annum, payable monthly with the first payment to commence on the last business day of February 2007. DFI will be entitled to pre-pay any part of the Principal prior to the maturity date of February [20], 2009.

The Credit Facility Agreement further provides that all amounts owing thereunder will be secured by all of DFI's and its subsidiaries' property and assets, including a first ship's mortgage over DFI's mining vessel "DF Discoverer". The Credit Facility Agreement contains other customary representations, warranties and covenants. A copy of the Credit Facility Agreement, including the schedules thereto which comprise the security instruments, will be filed on the SEDAR website (www.sedar.com) under the Company's profile as a material contract.

As Spirit is an insider of the Company, the transaction contemplated by the Credit Facility Agreement constitute a "related party transaction" under Rule 61-501 of the Ontario Securities Commission (the "OSC Rule"). However, as a loan or credit facility transaction, the transaction is exempted from the formal valuation requirements of the OSC Rule. The Company is also exempted from the shareholder approval requirements of the OSC Rule provided by the exemption contained in section 5.7(1)7 (Loan to Issuer, No Equity or Voting Component) of the OSC Rule. In reaching these conclusions, the directors of the Company (each of whom are independent of Mr. Boulle and Spirit) unanimously determined that the Credit Facility Agreement is on commercially reasonable terms that are not less advantageous to the Company than if a similar credit facility were obtained from a person or company dealing at arm's length with the Company, and that the Credit Facility Agreement and the transactions and agreements contemplated thereby are fair and reasonable to the Company and are in the best interests of the Company and its shareholders. The Credit Facility Agreement has been accepted by the Toronto Stock Exchange ("TSX").

A material change report was not filed prior to 21 days before the execution of the Credit Facility Agreement and the advance of funds thereunder, as the Company wished to negotiate and complete the transaction on an expedited basis in view of its working capital requirements and for other sound business reasons.

The Credit Facility Agreement also provides that the Principal and all outstanding accrued and unpaid interest may become convertible, in whole or in part at the election of Spirit, into common shares of DFI, subject to receipt of necessary approvals of TSX and the minority shareholders of the Company as required under the OSC Rule and the rules and policies of the TSX. The Company has agreed to hold a special meeting of its shareholders to seek the necessary shareholder approval of such conversion feature priced at the lowest conversion rate currently available under the rules of the TSX and will provide further details in due course. Until such approvals are obtained, no amount owing under the Credit Facility Agreement will be convertible into common shares of the Company, except in respect of the 2004 Note Amount which remains convertible pursuant to the terms of the 2004 Note as previously approved by shareholders.

Pursuant to the Credit Facility Agreement, effective February 22, 2007, Spirit advanced US$930,000 to the Company, leaving an additional US$570,000 available for future advances under the Credit Facility Agreement as may be required by DFI.

DIAMOND FIELDS INTERNATIONAL LTD.

"Roger Daniel"

Roger J. Daniel, President and CEO
For further information, contact Roger Daniel at +27 21 425 1990
Website: www.diamondfields.com

Forward-Looking Statements:
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors identified in Diamond Fields' periodic filings with Canadian Securities Regulators. Such forward-looking information represents management's best judgment based on information currently available. No forward-looking statement can be guaranteed and actual future results may vary materially. Diamond Fields does not assume the obligation to update any forward-looking statement.
 
 

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