Stornoway Diamond Corporation (TSX:SWY), BHP Billiton Diamonds Inc. (BHP Billiton) and Hunter Exploration Group wish to provide the following update on the summer exploration activities at the Aviat Diamond Project, located in Canada's eastern Arctic territory of Nunavut.
The Aviat summer exploration program began on July 05, 2005 and crews are currently demobilizing. Three new kimberlite outcrops (AV6, AV7 and AV8) were discovered from prospecting. The occurrences are all hypabyssal kimberlite visually similar to previously reported kimberlites from the Aviat property, more specifically AV1 to AV5, inclusive, all of which proved significantly diamondiferous from initial test work. The three new discoveries are located in close proximity to the other known kimberlites, within approximately 6 km of AV1. AV1 has undergone the most advanced assessment from drilling to date and has returned a sample grade of 0.83 carats per tonne from the processing of approximately 10.4 tonnes of kimberlite (all sieved stones >0.85 mm). Approximately two tonnes of surface material was collected from each of these new showings for diamond analysis, with final results expected by year-end.
A total of 29 drill holes (approximately 2880m) were completed during the summer program. Three geophysical targets were drill tested without intersecting kimberlite. One hole was drilled at AV1 and extended the known kimberlite body some 170m to the west of previously reported intersections. The remaining holes focused in the vicinity of the AV2 through AV6 and AV8 occurrences. Multiple kimberlite intersections ranging from 0.1m to 23.6m were encountered at those occurrences - more details are provided below. Drilling suggests the bodies are sheet-like in nature, although actual dimensions and orientations have not yet been determined. Kimberlite AV7 could not be drilled due to its proximity to a lake.
Prospecting to follow-up anomalous indicator mineral results derived from the 2004 till sampling program has discovered almost 350 locations with kimberlite boulders, not counting the new kimberlite outcrops mentioned above. Although no mineralogical or geochemical studies have been made of these new boulder showings, based on the distribution and field descriptions, spatially related boulders are thought to represent a minimum of five trains coming from discrete source bodies that have not yet been identified. The significance of numerous, more isolated, boulder occurrences is not known at this time. Detailed till sampling was completed in nineteen priority areas outside of the known boulder trains, where anomalous till samples with high diamond potential pyrope garnets were recovered in 2004. More than 3100 till samples were collected in 2005.
Eira Thomas, President and CEO commented, "The geochemical results from 2004 continue to provide strong encouragement for the presence of further significantly diamondiferous kimberlite discoveries in at least five areas. From 2004, we have many samples that have returned significant proportions of, G10 and G10D pyrope garnets which so far, have not been evidenced in abundance from the known bodies (see pyrope plot below). The regional pyrope signature of the Tremblay Corridor is distinctly similar to that of the prolific Lac de Gras diamond fields which host Ekati and Diavik, Canada 's first two diamond mines, and therefore, Stornoway remains highly optimistic that further diamond discoveries are likely at Aviat. Tight sampling grids using 100m line spacing and 50m sampling intervals have been completed in each of the priority areas and should help to isolate targets for drill testing next year."
**Click link for enlarged graph
http://www.stornowaydiamonds.com/garnet_plots.pdf
The three new kimberlite outcrops discovered so far in 2005 are described in more detail below. In each case the true size, shape and nature of the showing is not known at this time, and no diamond results are available. Approximately 2000kg of surface material was collected from each new occurrence for analysis using both caustic fusion to recover microdiamonds and dense media separation for the recovery of macrodiamonds. Similar sized surface samples were also collected from AV2 and AV5, with smaller samples taken from AV3 and several of the unsourced boulder trains. Final results are anticipated before year-end.
The original AV6 showing comprised a 1.5mx2.5m outcrop of hypabyssal kimberlite. Test pits dug by hand in the immediate vicinity of AV6 bottom in frozen disaggregated kimberlite material that is believed to be subcrop. The test pits cover an area of approximately 3mx17m. Three holes were drilled. One hole failed to intersect kimberlite and multiple short intersections (up to 0.9m in length) were encountered in the other two holes.
AV7 was initially a 0.5mx0.7m outcrop situated some 320m southeast of AV6. Subsequent test pits dug by hand suggest an exposure of 6mx7.5m, although the boundaries are not well defined . The exposure lies 10m from a lakeshore and trends down slope towards the lake. Kimberlite boulders were also found along the lakeshore on either side of AV7 over a total distance of 76m. This lake is situated along the same prominent west-northwest trending structure that hosts the AV1 kimberlite. AV7 could not be drill tested during the summer program because of land use permit limitations given it's proximity to a lake. AV7 will be drill tested at a later date when the lake is frozen.
The AV8 kimberlite outcrop measures 3.7mx8.5m, with patchy discontinuous occurrences of subcrop or green kimberlitic tills recognized over an area of about 25mx28m. Six holes were completed. Five of the six holes intersected kimberlite to a maximum down hole length of 4.2m. The nature of the intersections suggests the presence of stacked sub-parallel sheets of kimberlite, although the orientation, extent and possible inter-relationship of these bodies is not known at the present time.
Four of the previously known kimberlite occurrences (AV1, AV2, AV3 and AV4) were also re-drilled during the summer program. The AV1 body was extended 170m west of any previously reported drill section (a 2.35m kimberlite intercept). A single hole at AV2 encountered four kimberlite intersections totaling 5.63m in down-hole length. AV3 has been extended 200m to the south of the surface exposure (three holes each with single intercepts of 0.89m, 2.99m and 4.94m) and a single infill hole on AV4 encountered 23.6m of kimberlite. The diamondiferous AV5 boulder showing (reported in 2004) was tested with seven drill holes. Although, four of the holes hit multiple kimberlite intersections from 0.18m to 1.37m in length, these intercepts appear visually distinct from the boulders and are not believed to represent the source body at this time. Additional material from the original AV5 boulder showing was collected for further analysis of geochemistry and diamond content. Detailed grid-scale till sampling was completed to help better isolate the potential source body of AV5 for drilling in 2006.
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
/s/ "Eira Thomas"
Eira Thomas