About the Qilalugaq, Pikoo, Timiskaming Exploration Projects
The Qilalugaq Diamond Project, located on the Rae Isthmus of Nunavut close to the hamlet of Repulse Bay, includes the Qilalugaq kimberlite pipes and the Naujaat system of kimberlite dykes. The project was originally optioned by Stornoway and subsequently acquired from BHP Billiton Diamonds Inc. in July 2006 and July 2010, respectively. The project includes the 12.5 hectare Q1-4 kimberlite, the largest kimberlite pipe in the eastern Canadian Arctic. In June 2012 Stornoway announced an Inferred Mineral Resource at Q1-4 of 26.1 million carats from 48.8 million tonnes of kimberlite with an average +1 DTC total diamond content of 53.6 carats per hundred tonnes (cpht) extending from surface to a depth of 205m. Additional resource upside in the form of a target for further exploration was estimated at between 7.9 to 9.3 million carats from 14.1 to 16.6 million tonnes of kimberlite with an average +1 DTC total diamond content of 56.1 cpht, extending from 205m depth to 305m depth.
The Pikoo Project comprises 33,374 hectares of contiguous claims located in central Saskatchewan, approximately 140 km east of La Ronge Saskatchewan and 100 km west of Flin Flon Manitoba and close to the community of Deschambault Lake. Previous geochemical and geophysical work by Stornoway has outlined the potential for several kimberlites with diamond potential on the property. In 2012 kimberlite float was discovered that returned a single microdiamond from 73.8 kilograms of material submitted for caustic dissolution.
The Timiskaming Project comprises 3,865 hectares of claims located close to the community of New Liskeard, Ontario. Stornoway and its predecessor companies have discovered a total of 9 kimberlites out of over 50 kimberlites that are believed to have been discovered in the region. Stornoway's 95-2 kimberlite, the best delineated and most promising Timiskaming kimberlite discovered to date, contains an Inferred Mineral Resource of 2.3 million carats from 20.2 million tonnes of kimberlite with an average +1 DTC total diamond content of 11.3 cpht extending from surface to a depth of 300m. The 95-2 kimberlite is excluded from the Timiskaming option agreement.
About the Renard Diamond Project
The Renard Diamond Project is located approximately 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau in the James Bay region of north-central Quebec. In November 2011, Stornoway released the results of a Feasibility Study at Renard, followed by an Optimization Study in January 2013, which highlighted the potential of the project to become a significant producer of high value rough diamonds over a long mine life. Probable Mineral Reserves as defined under NI 43-101 stand at 17.9 million carats, with a further 17.5 million carats classified as Inferred Mineral Resources, and 23.5 to 48.5 million carats classified as non-resource exploration upside. All kimberlites remain open at depth. Pre-production capital cost stands at an estimated C$752 million, with a life of mine operating cost of C$57.63/tonne giving a 67% operating margin over an initial 11 year mine life. Readers are referred to the technical report dated December 29, 2011 in respect of the November 2011 Feasibility Study for the Renard Diamond Project, and the press release dated January 28, 2013 in respect of the January 2013 Optimization Study, for further details and assumptions relating to the project.
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