News Releases

February 23, 2000
Third Quarter Ended December 31, 1999 And Financial Restructuring
Trans Hex International Ltd. (TSE-THI) today announced the results of its operations for the nine months ended December 31, 1999. The Company also announced that Trans Hex Group Limited will convert their outstanding loan as at March 31, 2000 into equity and make project finance available to the Company's two principal projects for the 2001 fiscal year.

On the Barra Grande peninsula in the Minas Gerais state of Brazil, reverse circulation drilling and heavy mineral analysis of the drill samples have identified at least 3 targets, with potential gravel volumes in excess of 100 million cubic metres. Detailed drilling on 2 of these targets is in progress in order to define the best sites for sampling. Slow, but steady progress has been made in the ongoing negotiations for access with the landowners on the peninsula and no undue delays in the program are expected. The granting of environmental permitting for sample excavation and treatment is expected to take 3 to 4 months, during which time a mobile, 10 tonne-per-hour, dual 6 ft rotary pan plant will be constructed. The sampling program is designed to indicate diamond grades and values in the three target areas and will be used to direct the larger bulk sampling program.

The delay at the Company's Northbank project in Namibia continues, although progress has been made towards reaching a settlement with the landowner. Planning for the excavation and treatment of 75,000 cubic metres of gravel from the initial two bulk samples, following the construction of a 100 tonne-per-hour dense media separation plant, is complete. This sampling program will seek to confirm that gravels here have similar diamond grades and value as those being mined downstream on the southern bank of the river.

At the Skeleton Coast project, Namibia, a detailed marine bathymetric and seismic survey of the Swallow Breakers feature beyond the surf zone, has identified a paleo-beach connected to the current strand line by a series of north-south trending, sediment filled gullies separated by rocky ridges. A number of targets have been selected for sampling.

In Botswana, work is progressing on the Rainbow project where the Company will be deepening the exploratory hole into the Carol anomaly, a circular anomaly of 1 kilometre diameter that potentially represents a kimberlite of 80 hectare extent. Kimberlite indicator mineral sampling on 5 kilometre centres will also commence shortly on the Ngamiland project in Northern Botswana.

During the nine months under review the Company incurred a net operating loss of $711,000 (1999: loss of $1,532,000). Exploration and development expenditure capitalized during the nine months ended December 31, 1999 totaled $1,070,000 (1999: $989,000), the most material component being $808,000 incurred on the Barra Grande project in Brazil. General exploration expenditure during the period amounted to $86,000, while general and administration expenses were well contained at $588,000 for the nine months, compared with $733,000 in the comparable period of the prior year.

The loan from a related party is due to the Company's principal shareholder, Trans Hex Group Limited, a substantial South African diamond producer. The shareholder will apply the outstanding balance on this loan as at March 31, 2000 to purchase common shares in the Company at $4.00 per common share. The balance of the loan is expected to be approximately $3 million, which would result in the issue of some 750,000 common shares. The shareholder presently owns 9,975,001 common shares of the Company (or 71.8%) and on completion of the transaction would own approximately 10.7 million common shares, representing an interest of some 73%. The Company has also negotiated the terms of project finance Loan Agreements with Trans Hex Group Limited for the funding of the its two principal projects, Northbank and Barra Grande, for the 2001 fiscal year. These project finance loans, together with interest at LIBOR, are only repayable from the initial net cash flow from these properties, or proceeds of disposition if the properties are sold. The retirement of the outstanding loan and the new project finance loans are subject to receipt of all necessary approvals.

With this commitment of finance to the Northbank and Barra Grande projects, for the proposed sampling programs scheduled to commence during 2000, the Company's net working capital will be sufficient to fund the activities on its remaining properties and corporate overheads for the 2001 fiscal year.

With effect from April 1, 2000 Mr. Niel Hoogenhout will concentrate on the non-South African corporate activities of the group in his capacity as president and chief executive officer of Trans Hex International and will be stepping down for personal reasons as group managing director of Trans Hex Group Limited, the South African parent company of Trans Hex International. Mr. Hoogenhout will remain on the Board of Trans Hex Group Limited as a non-executive director. Mr. Bernard van Rooyen, the Chairman of Trans Hex Group Limited, has been appointed to the Board of the Company in a non-executive capacity.

Trans Hex International is an international diamond exploration company with interests in exploration projects and joint ventures in Namibia, Brazil, Botswana and Zimbabwe. The principal shareholder of the Company is Trans Hex Group Limited, a South African producer of high quality gem diamonds, with well established independent diamond marketing facilities. The design and conduct of the Company's exploration programs is the responsibility of Mr. Peter Walker, a professional geologist registered with the South African Council for Natural Scientific Professions.

FOR FURTHER INFORMATION PLEASE CONTACT:

D.M. (Niel) Hoogenhout - President and C.E.O. Tel +1.416.363-5440 Fax +1.416.363-6506 E-Mail nhoogenhout@transhex.com

Peter W.A. Walker - Vice President, Exploration Tel +27.21.939-1105 Fax +27.21.939-0711 E-Mail PeterW@transhex.co.za

Stephen Woodhead - Chief Financial Officer Tel +1.416.363-5440 Fax +1.416.363-6506 E-Mail swoodhead@transhex.com
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Tsodilo Resources Limited
Canada Trust Tower, BCE Place
161 Bay Street, P.O. Box 508
Toronto, ON Canada M5J 2S1
Telephone: (416) 572-2033
Fax: (416) 987-4369
Website: www.TsodiloResources.com/
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