Stornoway Diamond Corporation
TSX : SWY

Stornoway Diamond Corporation

June 08, 2009 08:30 ET

Stornoway Diamond Corporation: Renard Summer Drill Program Commences

VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 8, 2009) - Stornoway Diamond Corporation (TSX:SWY) is pleased to announce the commencement of the next phase of an ongoing resource expansion and optimization program at the Renard Diamond Project in North Central Quebec. The Renard Diamond Project, which includes the Renard kimberlite pipes and the Lynx-Hibou system of kimberlite dykes, is a 50:50 joint venture with SOQUEM INC. ("SOQUEM").

Core drilling of some 9,500m on the Renard 2 kimberlite pipe will commence on June 10, and continue until late August. The objective of this program will be conversion of the 10.5 to 12.3 million tonnes of potential mineral deposit material identified at Renard 2 to a formal resource classification. The winter drill program at Renard exceeded expectations in the amount of new kimberlite discovered (see Stornoway Press Release dated March 31, 2009, available at: http://www.stornowaydiamonds.com/investor_relations/news_releases/2009/index.php?&content_id=473). It now appears that the Renard 2 kimberlite is approximately twice as large as previously thought when modeled to a depth of 570 meters below surface, and approximately three times larger when modeled to a depth of 712 meters below surface. The summer program will focus on detailed delineation drilling and sampling of the newly discovered material within Renard 2, and is expected to allow a restatement of the National Instrument ("NI") 43-101 mineral resource by year end, followed by a revision of the project's economic assessment.

President and CEO Matt Manson stated, "In the existing Renard Preliminary Assessment, Renard 2 contributed the bulk of the high grade resource contained within the conceptual mine plan. The discovery of such a large amount of new kimberlite in this pipe, much of it within the scope of the existing underground mine design, is expected to have a very positive impact on project economics, and has the potential to add approximately 8 to 10 years of mine life to the 7 year mine plan already established. The growing scale of the Renard Diamond Project, taken together with the Quebec government's recent announcement of major capital funding for the regional Route 167 Extension project, confirms it as one of Canada's premium diamond development projects".

The 2009 summer work at Renard conforms with Stornoway's stated objective of conducting modest, value-driven, exploration programs focused on our key, advanced projects during the currently challenging resource equity environment. It compliments ongoing desktop work at Stornoway's 90% owned Aviat Project designed to provide a qualified estimate of contained value and potential mining methods for Aviat's large Eastern Sheet Complex ("ESC"; Stornoway Press Release dated May 05, 2009, available at: http://www.stornowaydiamonds.com/investor_relations/news_releases/2009/index.php?&content_id=477), and continuing readiness to exploit, on an opportunistic and inexpensive basis, new discovery prospects identified within Stornoway's grassroots exploration portfolio.

About The Renard Diamond Project

In December 2008, Stornoway reported a positive Preliminary Assessment for the Renard Diamond Project (Stornoway press release of December 15, 2008, available at: http://www.stornowaydiamonds.com/investor_relations/news_releases/2008/index.php?&content_id=457), with an initial NI 43-101 compliant mineral resource comprising 7.0 million carats of Indicated Mineral Resources (11.6 million tonnes at an average grade of 60 carats per hundred tonnes, or "cpht") and 4.5 million carats of Inferred Mineral Resources (7.2 million tonnes at an average grade of 63 cpht). At this time, extensive exploration upside was identified in the form of an additional 9 to 21 million carats classified as "potential mineral deposit" (14 to 32 million tonnes ranging from 31 to 164 cpht).

Within the conceptual mine plan contained within the Preliminary Assessment, the most important kimberlite in terms of mineable carats, mine life and revenue was Renard 2, which was estimated to contain 3.36 million tonnes of Indicated Mineral Resource (at an average grade of 81 cpht) and 1.80 million tonnes of Inferred Mineral Resource (at an average grade of 86 cpht), as calculated to a depth of 570m. The diamond valuation for Renard 2, dated March 2008, was estimated at US$123/ct (with sensitivities of US$110 to US$139/ct). At that time, potential mineral deposit at Renard 2 was an additional 2.5 to 7.1 million tonnes with grades estimated between 73 and 164 cpht, calculated to a depth of 700m.

The recent winter drilling at Renard 2 (see Stornoway Press Releases March 09, available at: http://www.stornowaydiamonds.com/investor_relations/news_releases/2009/index.php?&content_id=468 and March 31, available at: http://www.stornowaydiamonds.com/investor_relations/news_releases/2009/index.php?&content_id=473) supports a better constrained geological model that is consistent with a revised potential mineral deposit estimated at between 10.5 and 12.3 million tonnes to 712 meters below surface, a substantial increase over the previous estimate. In this new model, Renard 2 has a dimension of 195 meters by 45-60 meters at a depth of 570 meters below surface as opposed to 48 meters by 10 meters previously, and remains open below 712 meters. Geological logging of the kimberlite intersected in the winter suggests that the kimberlitic breccia lithologies present in the deeper portions of Renard 2 are the same as those seen in the upper portions of the pipe. In these upper portions, extensive reverse circulation drilling and underground bulk sampling has established mineral resource level grades and a diamond valuation. To establish resource grades throughout the pipe, detailed micro-diamond and petrographic analysis will be used to correlate the newly drilled material with the portions of the pipe for which detailed geological and diamond data already exists. This comparative technique of grade extrapolation is an accepted and well established methodology for diamond resource estimation.

Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. In addition, the potential quantity and grade of any potential mineral deposit is conceptual in nature, and it is uncertain if further exploration will result in the target being delineated as a mineral resource.

Stornoway Diamond Corporation

Stornoway Diamond Corporation is one of Canada's leading diamond exploration and development companies, involved in the discovery of over 200 kimberlites in six Canadian diamond districts. The Company benefits from a diversified diamond property portfolio, a strong financial platform and management and technical teams with experience in each segment of the diamond "pipeline" from exploration to marketing. The Renard Diamond Project is managed by Dave Skelton, P. Geol. (AB/QC), Vice President, Project Development. Mr. Skelton is a Qualified Person under NI 43-101 and has reviewed the contents of this press release

SOQUEM INC.

SOQUEM is a wholly-owned subsidiary of Societe generale de financement du Quebec ("SGF"). The SGF, the Quebec industrial and financial holding company, has as its mission to undertake economic development projects in the industrial sector in cooperation with partners and in compliance with the economic development policies of the Government of Quebec.

On behalf of the Board

STORNOWAY DIAMOND CORPORATION

Matt Manson, President and Chief Executive Officer

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. Any statements made regarding a NI 43-101 Preliminary Assessment of a project includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the Preliminary Assessment will be realized. References to NI 43-101 Resource Calculations are Mineral Resources and are not Mineral Reserves and therefore do not have demonstrated economic viability. 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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