Peregrine Diamonds Ltd.

Peregrine Diamonds Ltd.

December 14, 2006 08:30 ET

Peregrine Diamonds Ltd.: Commencement of Third Bulk Sampling Program at DO-27

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Dec. 14, 2006) - Peregrine Diamonds Ltd. ("Peregrine") (TSX:PGD) is pleased to announce that land-based, large diameter, bulk sample drilling ("LDD") on the North East Lobe portion of the plus nine hectare, DO-27 kimberlite pipe, WO Diamond Project, NWT, Canada, began on December 6, 2006, more than 60 days earlier than the last bulk sampling program. The first LDD drill hole, DO27-NE-01, was completed yesterday to a planned depth of 98 metres with the majority of the hole drilled at 24 inch diameter. A total of 45 sample bags of kimberlite were recovered (each sample bag has a maximum rated capacity of 1.8 tonnes). The drill rig is currently setting up on the next hole, DO27-NE-02, which is located 25 meters south of DO27-NE-01. A second LDD rig is anticipated to begin drilling on the North East Lobe in early January 2007.

This early start resulted from careful logistical planning, having the two Encore Drilling, LDD rotary rigs on-site from last season, and the decision to begin this third bulk sample on the land-based portion of the main diamond-bearing pyroclastic unit of the North East Lobe of DO-27. Peregrine is currently the only mid-tier diamond exploration company properly positioned to commence bulk sampling in Canada's North so early in the season.

The primary focus of this bulk sampling program will be to significantly add to the 510 carat parcel of diamonds already recovered by Peregrine. In order to obtain a geologically meaningful average diamond valuation, at least 3,000 carats will be required (see November 6, 2006 press release).

This early start to the bulk sampling program, coupled with a significant increase in the project's infrastructure, has set the stage for an aggressive execution of this program.

Infrastructure improvements include:

- the staging of numerous pieces of ice making equipment, including water trucks, bulldozers, front-end loaders and road graders, on-site at the end of last season.

- the construction of Peregrine's own ice airstrip capable of hosting C-130 Hercules aircraft, anticipated to be completed and operational by mid-January 2007.

- the acquisition of a third large diameter drill rig: a dual-rotary, Foremost DR-40 with approximately 250,000 ft/lbs of torque, which is capable of setting large diameter casing (up to 40 inch) in soft, unconsolidated overburden and kimberlite. Completion of the Hercules capable ice airstrip will likely enable Peregrine to deliver the DR-40 to site several weeks earlier than an ice road based delivery.

- the DR-40 drilling rig is anticipated to facilitate the setting of 28 inch diameter casing, which should enable the extraction of kimberlite using 24 inch diameter drill-holes, in contrast to the majority of holes drilled last season which were 13 3/4 inch diameter. This 10 1/4 inch increase in drill hole diameter should result in an approximately 300% increase in the volume of kimberlite extracted per vertical metre of depth.

- a variety of casing sizes, 28, 24, 20 and 16 inch diameter, will be available for use onsite for the winter 2007 bulk sample (as opposed to only 28 and 16 inch available for the last bulk sample). This will allow Peregrine maximum drilling flexibility to meet the varied ground conditions encountered during lake based drilling.

- Peregrine also plans to adopt a modified vertical extraction technique in which controlled hole collapse will be used to extract the maximum amount of kimberlite from each drill hole. This bulk sampling method of controlled hole collapse is specifically designed to take advantage of the DO-27 kimberlite's natural tendency to expand and slough down the hole.

Program highlights for this third bulk sample include:

- up to 8 LDD holes planned on the land-based North East Lobe portion of the kimberlite, targeting the main pyroclastic unit in this area.

- these land-based holes are being drilled from ice pads with a minimum of 24 inches of thickness, next to previously drilled, pilot core holes.

- up to 20 LDD holes planned over the central portion of the kimberlite, targeting the main pyroclastic unit. These holes will be drilled on the DO-27 lake ice, which must be built up to a thickness of at least 72 inches. Currently, the ice thickness is approximately 40 inches, with ice-making activities ongoing and scheduled to continue into the New Year. It is anticipated that sufficient ice thickness to begin this drilling will be achieved by mid-January 2007, subject to weather.

- The budget for the Fall 2006/Winter 2007 LDD, bulk sampling programs only, total approximately $26.6 million.

An update on the various core drilling programs (Mid-zone between the DO-18 and DO-27 kimberlites, Geotechnical and Exploration), preliminary resource calculations, and the Preliminary Technical Assessment Report, will be provided in the New Year.

Peregrine is a well-funded Canadian diamond exploration/development company that is managed by experienced geoscientists. The company is completing a Preliminary Technical Assessment Report on the 9 hectare DO-27 and 3 hectare DO-18 diamondiferous kimberlite pipes, and is exploring for other diamondiferous kimberlites on its extensive land holdings in Canada. The company trades on the Toronto Stock Exchange under the symbol "PGD".

On Behalf of the Board of Directors:

Eric Friedland, President

Forward-Looking Statements: This document includes forward-looking statements. Forward-looking statements include, but are not limited to statements concerning Peregrine's projects, pre-feasibility studies, and other statements that are not historical facts. When used in this document, the words such as "could", "confident", "plan", "estimate", "expect", "anticipated", "intend", "likely", "may", "potential", "should", "scheduled", "significant", and similar expressions are forward-looking statements. Although Peregrine Diamonds Ltd. believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed under the heading "Risk Factors" and elsewhere in the corporation's periodic filings with Canadian regulators.

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