Grizzly Diamonds Ltd.

Grizzly Diamonds Ltd.

January 16, 2007 17:32 ET

Grizzly Drills into the Legend Kimberlite

First Drillhole intersects 152.1 m of kimberlite

EDMONTON, ALBERTA--(CCNMatthews - Jan. 16, 2007) - Grizzly Diamonds Ltd. (TSX VENTURE:GZD)(FWB:G6H) ("Grizzly") announces that it has completed the first hole of an aggressive drill program into the Legend Kimberlite. On January 13th drill hole L07-01 intersected kimberlite at 18.59 meters and ended in kimberlite at 170.69 meters. The drill has now been moved to the second setup where drilling continues to acquire kimberlite for a mini-bulk sample.

"We are extremely pleased that the mini-bulk sample is underway" said Mr. Brian Testo, President and CEO of Grizzly. "We look forward to an exciting 2007."

This phase of the Legend Project has budget of $500,000 and comprises 1,500m of drilling including a cross hair drill pattern across the Legend Kimberlite as well as additional drilling to test the Legend Camp Target and possibly other targets elsewhere on the property. This program will focus on the collection of a mini-bulk sample for diamonds and to adequately test the different phases of the Legend Kimberlite.

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 was previously tested by a single drillhole that yielded 4 microdiamonds from a 406.5kg sample.

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 2007 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.

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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