Stornoway Diamond Corporation
TSX : SWY

Stornoway Diamond Corporation

January 11, 2007 08:00 ET

Stornoway Reports New Diamond Results From Aviat Kimberlites

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Jan. 11, 2007) - Stornoway Diamond Corporation (TSX:SWY) and Hunter Exploration Group are pleased to report diamond sample grades from minibulk samples collected at five of the 11 known kimberlite bodies on the Aviat Project, Melville Peninsula, Nunavut. The AV2 Upper kimberlite returned 0.72 carats per tonne (cpt), AV4 returned 0.67 cpt, AV4 East returned 0.29 cpt, AV5 returned 0.75 cpt, and AV8 Upper returned 0.26 cpt (from the recovery of all diamonds greater than 0.85mm on a square mesh sieve). Additional details are provided below.

All Aviat kimberlite bodies tested to date have proven diamondiferous with sample grades ranging from 0.26 to 0.97 carats per tonne. Three of the five sample grades reported in the table below pertain to the 'eastern' kimberlite group and two to the 'western' kimberlite group. The eastern kimberlite group was the focus of the 2006 exploration program which identified significant tonnage potential (for more details refer to Stornoway Press Release 06-31; October 11, 2006). A map of the Aviat kimberlites is available at http://www.stornowaydiamonds.com/_resources/aviat_kimberlite_bodies.jpg.

Eira Thomas, President and CEO, commented, "Aviat's eastern kimberlite system currently consists of eight known shallow dipping bodies up to 4m wide which have been intercepted over a broad 1.5 by 3.0km area which remains open along strike and down dip. Three previously reported minibulk sample grades from this area ranged from 0.77 to 0.97 carats per tonne. At 0.72 and 0.75 carats per tonne respectively, the new minibulk sample results from AV2 Upper and AV5 are comparable, and support the need for additional work to evaluate this extensive kimberlite system. In conjunction with this work we will continue our search for the source of 15 discrete, high interest, indicator mineral trains and are anticipating an exciting 2007 field season at Aviat."

Sample weights and diamond counts for standard sieve size classes greater than 0.85mm (using a square mesh sieve) are summarized in the following table. Sample grades reported for kimberlite occurrences AV2 Upper, AV4 East, AV5 and AV8 Upper are based on recovery of diamonds by Dense Media Separation (DMS) processing of surface samples collected in 2005. The diamond sample grade for kimberlite AV4 is derived from +0.85mm stones recovered from 514kg of material (471.3kg of drill core and 42.97kg of AV4 boulders) processed through caustic fusion and previously reported. The AV4 body does not outcrop and insufficient kimberlite material was available at surface to allow DMS processing of a larger sample.



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Number of Diamonds Recovered
Sample Sample Grade Sample Weight (by sieve size)
--------- ------------- ------------- ---------------------------------
Carats Per
Tonne Tonnes
(+0.85mm) (dry) 0.85mm 1.18mm 1.70mm 2.36mm
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AV2 Upper 0.72 2.2 41 17 7 1
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AV4(1) 0.67 0.5 8 8 1 0
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AV4 East(1) 0.29 2.1 17 13 0 0
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AV5 0.75 2.4 57 20 8 0
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AV8 Upper 0.26 2.5 15 11 3 0
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(1) The AV4 and AV4 East occurrences belong to the western 'cluster' or
'group' of known Aviat kimberlites, and are situated some 450m west of
the original AV1 discovery. The other three kimberlite bodies reported
above are part of the eastern cluster of eight known sheet like bodies
(c.f. Stornoway Press Release 06-31; October 11, 2006).


AV2 Upper has been previously described as a roughly east-west striking kimberlite sheet with an estimated true thickness of 1.6m that subcrops at surface. No subcrops of the parallel, 3.3m thick AV2 Lower kimberlite sheet have been discovered to date and therefore no minibulk sample was collected. Both of the AV2 bodies have been drilled over an area of about 150m by 200m, remain open in three directions and are situated about 1km east-southeast of the AV6 and AV7 discovery outcrops, now part of the 4.2m thick AV67 body. AV67 had a combined DMS sample grade of 0.86 carats per tonne, has been intersected by drilling over an area of about 400m by 1000m and is open in three directions. Stornoway is currently undertaking geological modeling and diamond studies to determine if the AV2 Lower kimberlite is related to AV67.

AV4 East is a boulder showing up-ice of, but in close proximity to, the drill tested AV4 kimberlite body. A bedrock source for AV4 East boulders has not yet been determined, but DMS results provided above are comparable to caustic fusion results previously reported from that specific boulder occurrence (SWY Press Release 04-30; December 14, 2004). Those historic caustic results (representing 117.44kg of fused kimberlite) would yield a sample grade of 0.37 carats per tonne for stones retained on a 0.85mm screen.

The AV5 kimberlite, known from both extensive boulder occurrences and limited drilling over an area of 150m by 200m, is situated about 500m south of the AV6 and AV7 discovery outcrops. Stornoway is currently undertaking geological modeling and diamond studies to determine the relationship, if any, of the AV5 kimberlite to other kimberlite sheets in the 'eastern' kimberlite group.

The DMS sample grade reported above for the AV8 Upper body matches with microdiamond curves as derived from previously reported caustic fusion samples collected from the AV8 Upper outcrop (SWY Press Release 04-30; December 14, 2004). The AV8 Upper discovery outcrop is situated just over 3km east-southeast of the AV6 and AV7 outcrops and averages 2.9m true thickness. Drilling during 2006 identified the presence of stacked kimberlite sheets and suggests the AV8 Middle and AV8 Lower sheets are comprised of multiple intrusions within horizons approximately 5-8m thick. Caustic fusion results for the AV8 Middle and AV8 Lower sheets are still pending and will be reported when available.

The Aviat kimberlties continue to return promising diamond sample grades which, when coupled with the significant tonnage potential identified following the summer drill program, means that Stornoway will continue to focus on exploration of the eastern sheet complex at Aviat. Unsourced mineral trains will also be investigated. Although the DMS sample grades for AV8 Upper and AV4 East reported above are similar, the two occurrences are separated by more than 6km, are lithologically different and not thought to be related. Additional detail for each of the DMS samples is provided below.



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No. of Carat
Stones Weight Largest Largest
Dry greater greater Stone Stone
Weight than than Carats Dimension Weight
Body (kg) 0.850mm 0.850mm Per Tonne (mm) (carats)
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AV2 Upper 2189 66 1.5795 0.72 4.12x2.83x2.21 0.189
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AV4 East 2091 30 0.607 0.29 2.70x2.15x1.30 0.048
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AV5 Bldrs 2410 85 1.8025 0.75 3.77x2.47x1.78 0.095
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AV8 Upper 2529 29 0.6545 0.26 2.67x2.32x2.03 0.129
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The majority of diamonds recovered through DMS processing of AV2 Upper and reported above are described as bright white stones representing a mix of octahedral and tetrahexahedroid forms. More than half of the diamonds recovered from AV4 East boulders are described as bright white stones with the remainder a mix of grey and brown stones representing dodecahedroid, octahedral and tetrahexahedroid forms. Diamonds from AV5 are described as a mix of white and grey stones representing both octahedral and tetrahexahedroid forms, and the AV8 diamonds are described as a mix of white, grey and brown stones representing mostly tetrahexahedroid and combination forms.

New diamond results reported above are based on recovery of diamonds by a Dense Media Separation plant owned by Stornoway, and operated by Microlithics Laboratories in Thunder Bay, Ontario, an independent mineral process laboratory currently providing services exclusively to Stornoway and its affiliates. Stornoway's diamond exploration programs are conducted under the direction of Robin Hopkins, P.Geol. (NT/NU), a Qualified Person under NI 43-101. As part of Stornoway's ongoing QA/QC program, DMS residues from AV8 Upper are currently being subject to a complete tails audit. Any significant changes to the sample grade provided above will be reported when available.

The Aviat Project is a joint venture between Stornoway Diamond Corporation (70%), BHP Billiton (20%) and Hunter Exploration (10%) Group and occupies close to 4 million acres in eastern Nunavut on the Melville Peninsula, north of Hudson Bay. Stornoway Diamond Corporation maintains interests in more than 18 million acres of ground, spanning 40 properties in northern Canada and Botswana, and representing one of the largest, most diversified and prospective diamond property portfolios in the world. These projects include advanced-stage exploration properties such as Aviat, Qilalugaq and Churchill, where a total of 78 kimberlites have been discovered since 2002, 42 of which have so far proven diamondiferous and several of which have been minibulk sampled and returned potentially economic grades.

On behalf of the Board

STORNOWAY DIAMOND CORPORATION

Eira Thomas, President

This news release may contain forward looking statements, being statements which are not historical facts, including, without limitation, statements regarding potential mineralization, exploration results, resource or reserve estimates, anticipated production or results, sales, revenues, costs, "best-efforts" financings or discussions of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based upon a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. Important factors that could cause actual results to differ materially from the Company's expectations are in Company documents filed from time to time with the Toronto Stock Exchange and provincial securities regulators, most of which are available at www.sedar.com. The Company disclaims any intention or obligation to revise or update such statements.

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