Peregrine Diamonds Ltd.
TSX : PGD

Peregrine Diamonds Ltd.

December 06, 2010 08:01 ET

Peregrine Reports CH-6 Mini-Bulk Grades of 6.8, 3.5, 2.8 and 2.0 Carats Per Tonne in Four Samples Totalling 14.11 Tonnes

Exceptional White/Colorless Diamond Population With High Clarity and Superior Shapes

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Dec. 6, 2010) - Peregrine Diamonds Ltd. ("Peregrine" or "the Company") (TSX:PGD) is pleased to report that a 14.11 tonne mini-bulk sample of drill core collected from the CH-6 kimberlite returned 40.04 carats of commercial-sized diamonds larger than the 0.85 mm sieve size. The mini-bulk sample was divided into four sub-samples, based on geology. The sub-samples, which were processed separately and ranged in size from 1.03 to 7.56 tonnes, returned diamond grades of 6.81, 3.49, 2.82, and 2.03 carats per tonne ("cpt"). The sub-sample with the highest grade was collected from the upper portion of the pipe. Overall, the 14.11 tonne sample yielded 523 commercial-size diamonds, nine of which weighed 0.50 carat or more, including two diamonds larger than one carat. The largest three diamonds were a 1.29 carat off-white, transparent macle, a 1.02 carat off-white, transparent octahedron, and a 0.99 carat white/colorless, transparent, tetrahexahedron.

Mr. Howard Coopersmith, Peregrine's external Qualified Person for the sampling and diamond recovery process stated, "Overall, CH-6 shows an exceptional white diamond population, with high clarity and many superior shapes present. There are indications of fancy yellow stones as well, and very few browns or greys. It is expected that larger parcels of CH-6 diamonds would produce valuations comparable to better quality kimberlite diamond mines in the world."

The CH-6 kimberlite has an estimated surface expression of at least 0.8 hectare based on drilling, is open to expansion in several directions including depth, is covered by only 15 metres of overburden, and is located on the 9,800 square kilometre Chidliak project ("Chidliak" or "the Project"), Baffin Island, Nunavut, Canada. The sample processing and diamond recovery were conducted by the Saskatchewan Research Council Geoanalytical Laboratories ("the SRC"). The diamond results, including the grades for the four geologically distinct sub-samples, Units A through D, and for the final cleanup of the plant equipment after all the samples were processed, are presented in square mesh sieve format in the following table.

SUMMARY OF CH-6 MINI-BULK SAMPLE DIAMOND RESULTS
Kimberlite Sub-Sample Sample
Weight
(tonnes)
Numbers of Diamonds According to Sieve Size Fraction (mm) Total
Diamonds
Carats
(+0.85
mm)
Diamond
Grade
(cpt)
(+0.85
mm)
+0.85
-1.18
+1.18
-1.70
+1.70
-2.36
+2.36
-3.35
+3.35
-4.75
+4.75
Unit A 1.03 16 27 10 5 3 1 62 7.03 6.81
Unit B 3.38 37 70 32 14 0 0 153 9.53 2.82
Unit C 2.13 22 36 20 8 3 0 89 7.44 3.49
Unit D 7.56 48 70 44 24 4 0 190 15.32 2.03
Plant Cleanup - 14 13 2 0 0 0 29 0.72 -
Total 14.11 137 216 108 51 10 1 523 40.04 2.84
 
The diamond grade of the CH-6 mini-bulk sample as determined by DMS processing may not be representative of the overall diamond grade of the CH-6 kimberlite due to a number of factors including the limited area of the kimberlite from which the CH-6 sample was collected and the relatively small size of the mini-bulk sample.

The colors and shapes of the nine diamonds 0.50 carat and larger are described by the SRC as follows: three diamonds are white/colorless, two are off-white, three are yellow and one is grey. Four of the diamonds are described as octahedrons, three are macles, one is a tetrahexahedron and one is an aggregate.

Mr. Eric Friedland, Peregrine's Chief Executive Officer stated "If these spectacular results are confirmed by future work, CH-6 will be one of the highest grade kimberlite pipes in the world, comparing favorably to the pipes of the renowned Canadian Diavik™ Diamond Mine, which grade from 3.0 to 4.8 carats per tonne. Another important attribute of CH-6 is that it's covered by shallow glacial till, whereas the Diavik™ pipes were discovered under a large lake, which required considerable expenditure and creative engineering to allow for mining. We are very pleased with the apparent high quality of the CH-6 diamonds, suggesting that the average diamond value will likely be substantial. The combination of high grade and strong diamond value could make CH-6 the anchor pipe of a possible future diamond mine, as it is clustered with at least four other kimberlites that have economic potential in Arctic settings, including the estimated five hectare CH-31 pipe. The next steps for CH-6, beginning in 2011, are continued core drilling to define the ultimate size of this pipe, as it remains open for expansion in several directions including depth, and larger bulk samples to provide further confirmation of its world class grade and diamond value potential."

Photographs of some of the diamonds recovered from CH-6 and additional information about this pipe are available at the following link http://www.pdiam.com/i/pdf/Chidliak758.pdf.

SAMPLE COLLECTION, PROCESSING AND DIAMOND RECOVERY

A representative 14.58 tonne sample was collected from the eight HQ (6.3 centimetre diameter) core holes drilled at CH-6 this year and from excess NQ (4.7 centimetre diameter) drill core acquired from CH-6 in 2009. After collection in the field, the drill core was shipped 120 kilometres to Peregrine's core logging facility in Iqaluit, the capital of Nunavut, where it was logged and divided into four separate sub-samples based on geologic logging and interpretation. A representative control sample weighing 465.3 kilograms was then extracted from the original 14.58 tonne sample, to be processed separately from the 14.11 tonne mini-bulk sample. The logging, collection and shipment of the samples was conducted under strict chain of custody protocols, supervised by senior Peregrine personnel. 

At the SRC, the 14.11 tonne sample was crushed by a jaw crusher with a gap set at approximately 30 mm. The sample was then fed into a five tonne per hour DMS plant where it was subjected to scrubbing and two stages of crushing. DMS concentration was performed on +0.85-12.0 mm feed material. Heavy mineral concentrate from the DMS was treated through a two-stage Flow Sort x-ray sorter and vibrating grease table recovery circuit. The resulting concentrates were then hand-sorted for final diamond recovery using sealed glove boxes. 

As an element of Peregrine's Quality Assurance/Quality Control protocols, 40 numerically laser-etched natural diamond tracers ranging in size from 0.26 to 1.62 carats were added to the mini-bulk sample bags at the Iqaluit core logging facility. Additionally, 35 numerically laser-etched natural diamond tracers ranging in size from 0.14 to 4.74 carats, and 45 synthetic tracers with a density of 3.53 g/cm3 were added to the samples at the SRC. One hundred percent of all the tracers were recovered at the SRC. 

To exercise control over the DMS results, the representative 465.3 kilogram control sample was processed by caustic fusion at the SRC for diamonds larger than the 0.425 mm sieve size and the results are presented in the following table.

CAUSTIC FUSION DIAMOND RESULTS FOR THE 465.3 KILOGRAM CONTROL SAMPLE FROM CH-6
Kimberlite Sub-Sample Sample Weight (kg) Numbers of Diamonds According to Sieve Size Fraction (mm) Total Diamonds Carats (+0.85 mm)
0.425 -0.600 0.600 -0.850 0.850 -1.180 1.180 -1.700 1.700 -2.360 2.360 -3.350 3.350 -4.750
Unit A 44.5 7 7 3 3 1 0 0 21 0.21
Unit B 122.2 19 19 9 5 2 1 0 55 0.60
Unit C 61.0 4 4 2 1 0 0 1 12 1.07
Unit D 237.7 19 12 7 6 1 0 0 45 0.36
Total 465.3 49 42 21 15 4 1 1 133 2.24

The largest diamond recovered from the control sample was a 0.99 carat white/colorless, transparent octahedron. The caustic fusion recoveries will be used in conjunction with other audits to confirm the efficiency of the processing and diamond recovery circuits at the SRC.

ABOUT CH-6

The CH-6 kimberlite was discovered by core drilling during the summer of 2009, and as announced on September 21 and November 12, 2009, 4,737 diamonds larger than the 0.075 mm sieve size were recovered by caustic fusion analysis of 569.1 kilograms of kimberlite from this pipe, including ten diamonds larger than 0.10 carats and four diamonds larger than 0.30 carats.

As reported on July 19, 2010, eight HQ (6.3 centimetre diameter) core holes were drilled into the CH-6 kimberlite this year. Seven of the holes were vertical, four of which terminated in kimberlite, and one was an angle hole across the north-central portion of the kimberlite body. Geological interpretation of the CH-6 drill logs indicates that the pipe consists of volcaniclastic kimberlite to a vertical depth of between 100 and 150 metres underlain by massive coarse-grained macrocrystic kimberlite. Abundant coarse-grained kimberlite indicator minerals and abundant mantle xenoliths, including eclogite, harzburgite, websterite and garnet lherzolites up to 23 centimetres in size were observed, consistent with the kimberlite samples collected from CH-6 in 2009. The 14.11 tonne mini-bulk sample was split into the following four sub-samples based on both geologic observation and interpretation of the drill logs:

  • Unit A (1.03 tonnes): Unit A comprises the upper portion of the pipe, to a depth of approximately 40 to 45 metres below surface and consists of highly weathered kimberlite interpreted to be volcaniclastic in origin. 
  • Unit B (3.38 tonnes): Unit B is a less weathered kimberlite unit below Unit A to depths of approximately 100 metres below surface, and is interpreted to be of volcaniclastic origin.
  • Unit C (1.97 tonnes): Unit C is a zone of apparently mixed volcaniclastic and massive kimberlite that locally underlies Unit B to depths of approximately 150 metres.
  • Unit D (7.56 tonnes): Unit D comprises the pipe infilling phase and is a massive kimberlite that contains variable amounts of Paleozoic carbonate rock fragments; some marginal magmatic dyke material is also included in this sample. This unit underlies Units B and C and the sample was collected to a maximum depth of 325 metres. 

All sub-samples contain abundant mantle xenoliths. 

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.

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 programmes carried out by the Company at Chidliak. Dr. Jennifer Pell, Peregrine's Chief Geoscientist, was the Company's Qualified Person for the sample processing and diamond recovery. Howard Coopersmith, an independent consultant to the diamond industry, was Peregrine's external Qualified Person for the sample processing and diamond recovery process. Mr. Holmes, Dr. Pell and Mr. Coopersmith have reviewed this release and approve of its contents. 

Chidliak is a joint venture between Peregrine (49%) and BHP Billiton (51%). 

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
    Chief Executive Officer
    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 and Corporate Communications
    604-408-8880
    or
    Peregrine Diamonds Ltd.
    Investor Relations
    604-408-8880
    investorrelations@pdiam.com
    www.pdiam.com