Peregrine Diamonds Ltd.

Peregrine Diamonds Ltd.

March 28, 2011 08:20 ET

Peregrine Diamonds Ltd.: Chidliak Joint Venture Approves $17.7 Million 2011 Diamond Exploration Program

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 28, 2011) - Peregrine Diamonds Ltd. (TSX:PGD) ("Peregrine" or "the Company") is pleased to announce that the Chidliak Joint Venture (Peregrine 49% and BHP Billiton 51%) has approved a $17.7 million 2011 exploration program on the 8,580 square kilometre Chidliak project ("Chidliak" or "the Project") on Baffin Island, Nunavut, Canada. Since 2008, 50 kimberlites have been discovered on the Project, with seven of these having characteristics consistent with economic potential in Arctic settings. Peregrine is the operator of the 2011 program and field work has commenced.

The 2011 program has two primary objectives:

  • Continued exploration focussed on discovering large kimberlites using new targeting information developed from the 2010 discovery of the CH-31 and CH-33 kimberlites. CH-31 is drill-confirmed at greater than five hectares in surface area, and new geophysical interpretations for CH-33 indicate potential for an elongated body with surface area greater than seven hectares.
  • Further evaluation of known kimberlites with economic potential by core drilling and/or mini-bulk sampling.

The 2011 program is expected to set the stage for the collection of bulk samples in 2012 to obtain initial parcels of diamonds sufficient to estimate the diamond value of the most promising kimberlites.

Mr. Tom Peregoodoff, Vice President, Exploration at BHP Billiton said "BHP Billiton is encouraged by the initial results from the Chidliak project. With our partner Peregrine Diamonds, we have made good progress since the first kimberlite discovery in 2008 and we look forward to a successful 2011 campaign."

Mr. Brooke Clements, President of Peregrine, stated "We are confident that the $17.7 million 2011 exploration program will allow us to advance the Chidliak project substantially this year, building on our very successful 2010 program during which 34 kimberlites were discovered. There is real potential to discover additional large kimberlites which, if found to have coarse diamond size distributions, would add significant value to the Project."

The main work activities approved for 2011 include the following:

  • Up to 13,000 metres of core and reverse circulation ("RC") drilling with the following principle objectives:
    • Core and/or RC drilling of high-priority geophysical anomalies with large surface footprints that have been selected from airborne geophysical surveys conducted in 2008 and 2010, as well as priority targets that will be developed from the airborne survey that is currently underway.
    • Core drilling of the known high-interest kimberlite bodies to increase the understanding of their size, geology and diamond content.
  • Collection of a mini-bulk sample of approximately five tonnes by core drilling from the CH-31 kimberlite. CH-31 is estimated at over five hectares in size and an 840 kilogram microdiamond sample collected in 2010 returned 1.39 carats of commercial size (+0.85 mm) diamonds.
  • Collection of a 20 tonne mini-bulk sample from the surface of the CH-28 kimberlite. CH-28 is estimated at two hectares in size and a 239 kilogram microdiamond sample collected in 2010 returned 0.193 carats of commercial size (+0.85 mm) diamonds.
  • Completion of a 12,000 line-kilometre RESOLVE heli-borne magnetic-electromagnetic geophysical survey.
  • Ground geophysical surveys over anomalies selected from the 2008, 2010 and 2011 airborne geophysical surveys.
  • Indicator mineral sampling, ground geophysics and prospecting; 24 of the 50 currently known kimberlites have been discovered at surface by prospecting.
  • Initiation of preparations for a multi-kimberlite 2012 bulk sampling program.
  • Continuation of environmental baseline studies.

Field work has commenced at Chidliak with the construction of a third exploration camp, named Aurora, located 42 kilometres north of the Discovery Camp, and the initiation of ground and airborne geophysical surveying. Drilling of lake-based targets in the northern portion of the Project is scheduled to commence this week. Lake ice conditions are expected to support on-ice drilling until at least mid-May. The first two drilling locations will be the CH-17 kimberlite and anomaly 165, located 200 metres south of CH-17 and three kilometres north of Aurora Camp. In April and May, a second core drill and an RC rig will be utilized to test targets in the central portion of Chidliak.

Peregrine geophysicists have recently selected 21 geophysical anomalies over two hectares in size for follow-up this year, four of which are interpreted to be greater than 4.5 hectares. Many of these anomalies display magnetic/electromagnetic responses similar to the large CH-31 and CH-33 kimberlites. These anomalies will be evaluated by ground geophysics this winter and priority targets will be drilled this year. The Company also expects to generate additional large targets this spring from the 12,000 line-kilometre RESOLVE heli-borne survey that is currently being flown.

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 project. 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 program, 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 programs, 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
    Peregrine Diamonds Ltd.
    Mr. Brooke Clements
    Peregrine Diamonds Ltd.
    Mr. Mike Westerlund, Vice President,
    Investor Relations and Corporate Communications
    Peregrine Diamonds Ltd.
    Investor Relations
    604-408-8881 (FAX)