Stornoway Diamond Corporation
TSX : SWY

Stornoway Diamond Corporation

June 28, 2005 09:44 ET

Stornoway Diamond Corporation: Eastern Arctic Diamond Exploration Update; Seven New Kimberlites at Churchill Diamond Project

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - June 28, 2005) - Stornoway Diamond Corporation (SWY:TSX) would like to provide an update on its spring exploration activities in the Eastern Arctic where a total of 19 targets on the Churchill Project and 15 targets on the Aviat Project, respectively, have been tested during concurrent, ongoing drilling programs. The Company has been informed by joint venture partner, Shear Minerals Ltd. (SRM:TSXV), that kimberlite has been intersected in 9 drill holes defining 7 new kimberlites (8 kimberlites in total for 2005) on the Churchill Property near Rankin Inlet, Nunavut. No new kimberlites have been intercepted on the Aviat Property.

Eira Thomas, President and CEO commented, "We have completed less than 25% of the total drilling planned for 2005. At Churchill we continued to add new kimberlite bodies to what is emerging as one of Canada's largest kimberlite fields. At Aviat, we have tested our highest risk, lake based targets, selected using geophysics, and will now move on to test priority, land-based indicator mineral supported targets in the vicinity of 6 diamondiferous kimberlites identified on the property to date. The AV-5 kimberlite boulder occurrence, which returned the highest microdiamond counts from the property to date (93 diamonds from 48 kgs), will be drilled during this phase. Both Churchill and Aviat have returned highly encouraging mineral chemistry from sampling work which supports the likelihood of further diamond discoveries."

The Churchill Diamond Project is comprised of mineral rights to more than 7 million acres located near the community of Rankin Inlet and Chesterfield Inlet in the Kivalliq region of Nunavut. The project is owned by joint venture partners Shear, which has a 51% interest and is the operator, Stornoway (35%) and BHP Billiton Diamonds Inc (14%). So far in 2005, kimberlite has been intersected in nine drill holes defining seven new kimberlites on the Churchill Diamond Project and bringing the total number of confirmed kimberlite occurrences on the project to 30.

Target KD-428NW is characterized by a roughly oblate magnetic high anomaly with coincident EM approximately 80m by 180m; this vertical drill hole was drilled to a depth of 125m and intersected 116m of kimberlite terminating in kimberlite, the first kimberlite drilled in 2005.

Target KD-5135 intersected multiple lens of kimberlite totaling 6.3m within iron formation host rocks. This target is a circular magnetic high 75 m in diameter.

Target KD-900 is a 80m by 200m magnetic low anomaly. This vertical hole intersected 95.1 m of kimberlite from 7.4-102.5m,

Target KD-5108 was determined to be an approximately 1m wide kimberlite dyke. Target KD217 was re-drilled as a result of loosing the drill hole in 2004 due to bad ground after recovering only 3.3 m of kimberlite. Due to its location a second vertical hole was drilled and recovered 43.6m of kimberlite between 26m-69.6m.

Target KD-5821 is a magnetic low anomaly tested by a vertical hole and intersected 75.3m of kimberlite from 11m to 86.3m.

Target KD-209 was a magnetic low anomaly tested by a vertical hole, intersecting 4.1 m of kimberlite from 79.2 - 83.3m. A second inclined hole was repositioned to test the center of the target, and intersected 32.5 m of kimberlite from 32.0-64.5m

Target KD-5774 was a magnetic high anomaly tested by an inclined hole intersecting approximately 56 m of kimberlite between 80.2 -152.1m.

Target KD-244 is an 80x200 m magnetic low anomaly currently being tested by an inclined hole through the center of the strongest magnetic response. Kimberlite was intersected at a depth of 70 m, and remains in kimberlite at 77 m.

Representative samples are currently being collected from each of the new kimberlites and will be submitted to the Saskatchewan Research Council (SRC), an independent laboratory, for micro-diamond analysis. Samples will also be collected for petrographic and indicator mineral analysis to fully asses the diamond potential of these discoveries.

To date in 2005, 24 drill holes and 90 ground geophysical grids have been completed. The goal of the 2005 drill program is to test up to 50 priority targets at the source areas to high diamond potential mineral chemistry identified from till sampling on the property. The drill has now moved from the lake based targets to the land based targets. Drilling will continue through the summer and was not interrupted by the spring melt.

The 2005 Churchill Project field program is under the supervision of Jennifer Burgess, P. Geo., a Qualified Person under NI 43-101.

The Aviat Project is a joint venture between Stornoway Diamond Corporation (70%), BHP Billiton Diamonds Inc (20%) and Hunter Exploration Group and occupies 4.5 million acres on the Melville Peninsula, north of Hudson Bay. To date, 6 diamondiferous kimberlites have been discovered on the property, including the AV-1 kimberlite which has produced an initial sample grade of 0.83 carats/tonne from the processing of 10.4 tonnes of kimberlite.

The 2005 spring exploration program on the Aviat Project, Melville Peninsula, Nunavut, has been completed. During this program a total of 53 ground geophysical grids were completed over lake hosted targets. A total of 15 drill holes (1,402m) tested 15 different priority geophysical targets within and adjacent to the Tremblay indicator mineral corridor. All geophysical targets were explained but no kimberlite was intersected.

The 2005 summer exploration program will commence in early July and will focus on drilling of approximately 20 targets, prospecting, till sampling, and additional ground geophysical surveys. Drilling of priority land-based targets will include the AV-5 kimberlite boulder train which returned encouraging initial microdiamond counts from surface samples collected in 2004. Indicator mineral results continue to be received from the 2004 till sampling program and have returned high interest grain counts which remain un-sourced at the present time (grain counts from the best single sample to date exceed 500 visually picked pyropes as well as thousands of other indicator mineral grains).

Eira Thomas commented, "Aviat remains one of our top priorities for 2005. We continue to develop excellent targets based on the sampling results in 2004 and we are confident that further diamondiferous kimberlites remain to be discovered on the project in 2005".

Stornoway is a diamond exploration company with extensive landholdings (approximately 29 million acres) located in key project areas in northern Canada and Botswana. Stornoway will directly spend more than $15 million (Cdn) to explore our properties and, together with its partners, will be exposed to more than $22 million (Cdn) in exploration expenditures in 2005.

Stornoway's diamond exploration programs are conducted under the direction of Robin Hopkins, P.Geol. (NT/NU), a Qualified Person under NI 43-101.

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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