Grizzly Diamonds Ltd.

Grizzly Diamonds Ltd.

January 11, 2007 18:56 ET

Grizzly Announces Drill Mobilization to Legend Diamond Project

$1.0 Million Winter Budget for Alberta

EDMONTON, ALBERTA--(CCNMatthews - Jan. 11, 2007) - Grizzly Diamonds Ltd. (TSX VENTURE:GZD)(FWB:G6H) ("Grizzly") today is pleased to provide a progress update and future plans for a number of its Alberta Diamond properties. A $1.0 Million budget has been approved for the winter 2007 diamond exploration programs in Northern Alberta. Grizzly currently holds just over 3 million acres (1.2 million hectares) of prospective land in northern Alberta in the Buffalo Head Hills, the Birch Mountains and the Pelican Mountains.

As part of this aggressive exploration program, Grizzly is in the process of mobilizing a geological crew from APEX Geoscience Ltd. and a drilling crew from Titan Diamond Drilling Ltd. to the first drillhole on Grizzly's Legend Kimberlite in the Birch Mountains of northeast Alberta. A budget of $500,000 has been approved for the Legend Project. Grizzly is planning a 1,500 m drilling program on the Legend Kimberlite in order to acquire a mini-bulk sample for diamonds and to adequately test the different phases of the kimberlite. This program will include a cross hair drilling pattern across the Legend Kimberlite as well additional drilling to test the Legend Camp Target and possibly other targets elsewhere on the property.

The Legend Kimberlite is a 500 to 800 m diameter multiphase kimberlite that is composed of a 5,200 nT magnetic high core that is about 300 m in diameter with a surrounding 200 to 500 m weakly magnetic outer area that is likely representative of a volcanic apron, perhaps similar in nature to the Fort a la Corne kimberlites. Based upon petrographic work conducted by the Alberta Geological Survey, the Legend Kimberlite represents a multiphase kimberlite with large tonnage potential. The Legend Kimberlite, under only 12.9 m of overburden, has been tested by a single drillhole that yielded 4 microdiamonds from a 406.5kg sample.

A further exploration budget of $500,000 has been approved to complete a combination of airborne and ground geophysical surveys over Grizzly's Buffalo Head Hills properties potentially leading to drilling during 2007 or early 2008. Grizzly currently holds more than 2 million acres of highly prospective ground for kimberlites in the Buffalo Head Hills surrounding a number of kimberlite pipes currently held by the Buffalo Head Hills joint venture comprised of Ashton Mining of Canada Inc, Encana Corp. and Pure Gold Minerals Ltd. Grizzly's lands contain abundant diamond indicator mineral anomalies and a number of untested geophysical targets. The Buffalo Head Hills joint venture has recently announced that they are in the process of collecting a 200 tonne bulk sample from the K-14 Kimberlite and that they are considering collecting further bulk samples from the K-91, BH-225, K-6 and K-5 Kimberlites.

Grizzly Diamonds is an aggressive Canadian exploration company focused on exploring for diamonds in Alberta and precious metals in North America. It currently holds diamond properties in the Buffalo Head Hills, Birch Mountains and Pelican Mountain areas of Alberta totaling over three million acres which host prospective geophysical targets and associated diamond indicator minerals. In British Columbia, the Corporation has four precious metal properties totaling over 23,000 acres.

All 2006 field programs are being conducted under the supervision of Michael Dufresne, P. Geol., a principal of APEX Geoscience Ltd. and a Qualified Person under NI 43-101.

On behalf of the Board

Grizzly Diamonds Ltd.

/s/ "Brian Testo"

Brian Testo, President

This news release contains forward-looking statements regarding ongoing and upcoming exploration work and expected geology, geological formations and structures. Actual results may differ materially from those anticipated in these statements.

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

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