Peregrine Diamonds Ltd.
TSX : PGD

Peregrine Diamonds Ltd.

September 23, 2010 08:20 ET

Peregrine Announces a Coarse Diamond Size Distribution for the CH-28 Kimberlite at Chidliak; Pipe Size Estimated at Two Hectares

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 23, 2010) - Peregrine Diamonds Ltd. (TSX:PGD) ("Peregrine" or "the Company") is pleased to report a coarse diamond size distribution from a 238.9 kilogram surface sample collected from the CH-28 kimberlite on the 9,800 square kilometre Chidliak project ("Chidliak" or "the Project") on Baffin Island, Nunavut, Canada. The sample yielded 174 diamonds larger than the 0.106 mm sieve size, including five diamonds larger than the 0.850 mm sieve size which weigh a total of 0.196 carats. The CH-28 kimberlite pipe, estimated at two hectares in size, is located at the north end of the Chidliak diamond district which currently includes 49 additional kimberlites and extends approximately 70 kilometres north-south and 40 kilometres east-west.

The following table summarizes caustic fusion diamond results from the CH-28 kimberlite, the first diamond results from the 2010 programme. The analyses were performed at the Saskatchewan Research Council Geoanalytical Laboratories ("the SRC").

SUMMARY OF CAUSTIC FUSION DIAMOND RESULTS FOR A SAMPLE FROM THE CH-28 KIMBERLITE

Sample   Numbers of Diamonds According to Sieve Size Fraction (mm)     Carats
Weight +0.106 +0.150 +0.212 +0.300 +0.425 +0.600 +0.850 +1.180 +1.700 Total (+0.850
(kg) -0.150 -0.212 -0.300 -0.425 -0.600 -0.850 -1.180 -1.700 -2.360 Diamonds mm size)
238.9 71 37 28 16 12 5 2 2 1 174 0.196

Of the five diamonds larger than the 0.850 mm sieve size, three were classified by the SRC as having an off-white color, one was grey and one was yellow. The largest diamond was a 0.11 carat off-white, transparent tetrahexahedroid.

Mr. Brooke Clements, President of Peregrine stated "With these highly encouraging initial diamond results, CH-28 is currently the fourth, and largest, kimberlite pipe at Chidliak that has economic potential in arctic settings, joining CH-1, CH-6 and CH-7. We are confident that this Project will continue to deliver kimberlites with economic potential."

The discovery of the CH-28 kimberlite by prospecting was announced on August 4, 2010. Abundant kimberlite boulders and cobbles were discovered at surface within a depression having a diameter of 160 metres that corresponds with a magnetic-high geophysical anomaly. Kimberlite boulders over one metre in size are present. The observed kimberlite is volcaniclastic with limestone xenoliths and abundant coarse-grained kimberlite indicator minerals ("KIMs") including pyrope garnet, ilmenite and chrome diopside. CH-28 is located near the CH-17 kimberlite, which is the northern-most of two high-priority magnetic anomalies situated under a lake, each with an estimated surface expression of at least one hectare, as announced on May 20, 2010.

The northern half of the Project, an area that includes the CH-28 and CH-17 kimberlites, will be a focus of exploration for Peregrine in 2011. This area hosts several unexplained high-interest KIM anomalies and currently over ten high-priority geophysical anomalies. Exploration in this area is scheduled to commence in March, 2011 with the core drilling of lake-based kimberlite targets as well as CH-17 and will continue through the summer months with the core drilling of land-based targets and CH-28.

Images from CH-28 are available on Peregrine's web-site at http://www.pdiam.com/i/pdf/chidliak913.pdf.

The SRC is an independent laboratory that is accredited by the Standards Council of Canada to the ISO/IEC Guide 25 standard for diamond recovery by caustic fusion. The kimberlite samples were collected, sealed in secure containers and shipped to the SRC under strict chain of custody protocols supervised by senior Peregrine personnel.

As announced on November 24, 2008, BHP Billiton has exercised its First Option earn-in rights for Chidliak. Peregrine projects that BHP Billiton will reach $22.3 million in cumulative expenditures toward the end of this month, thereby earning a 51 percent interest in the Project. Upon vesting a 51 percent interest, BHP Billiton has a Second Option to earn an additional seven percent interest in the project by electing to fund the project to completion of a Bankable Feasibility Study. Peregrine expects to be advised regarding the Second Option election in November, 2010.

Mr. Peter Holmes, P. Geo., Peregrine's Vice President, Exploration, is a Qualified Person under NI 43- 101 and is responsible for the design and conduct of the programs carried out by the Company on the Chidliak property. Mr. Holmes has reviewed this release and approves of its contents.

Forward-Looking Statements: This news release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements relating to the proposed exploration programme, funding availability, anticipated exploration results, resource estimates, and future exploration and operating plans) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward- looking statements and, even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things, uncertainties relating to the availability and cost of funds, timing and content of work programmes, results of exploration activities, interpretation of drilling results and other geological data, world diamond markets, future diamond prices, reliability of mineral property titles, changes to regulations affecting the Company's activities, delays in obtaining or failure to obtain required project approvals, any changing budget priorities of BHP Billiton, operational and infrastructure risks, and other risks involved in the diamond exploration business. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to their inherent uncertainty.

Contact Information

  • Peregrine Diamonds Ltd.
    Mr. Eric Friedland
    CEO
    604-408-8880
    or
    Peregrine Diamonds Ltd.
    Mr. Brooke Clements
    President
    604-408-8880
    or
    Peregrine Diamonds Ltd.
    Mr. Mike Westerlund
    Vice President, Investor Relations
    604-408-8880
    or
    Peregrine Diamonds Ltd.
    Investor Relations
    604-408-8880
    investorrelations@pdiam.com
    www.pdiam.com