Peregrine Announces Completion of Rc Drilling Portion of 2015 Diamond Resource Development Program at Chidliak

May 14, 2015 PDF version
Peregrine Diamonds Ltd. (“Peregrine” or “the Company”) (TSX:PGD) is pleased to announce the completion of the large diameter reverse circulation (“RC”) drilling component of its 2015 Diamond Resource Development Program at its 100 percent-owned Chidliak diamond project (“Chidliak”). Chidliak is located 120 kilometres northeast of Iqaluit, the capital of Nunavut, Canada. During the winter program, six large diameter RC holes totalling 1,212.1 metres were drilled into the CH-7 kimberlite resulting in the collection of 558.5 wet tonnes of kimberlite after screening to +1.18 mm in the field.

The data acquired from the bulk sample will be used to establish the grade of the different geologic units at CH-7, and the resulting representative diamond parcels will be the subject of an independent diamond valuation. If results warrant, Peregrine will use this information, together with previously acquired geologic and diamond data, to prepare a maiden resource statement for CH-7. That resource would be included in a Preliminary Economic Assessment (“PEA”) scheduled for the first half of 2016 for a potential Phase 1 mine development at Chidliak.

Due to the lack of snowfall this winter coupled with the onset of spring weather conditions at Chidliak, the RC drilling program has ended prior to drilling at the CH-6 or CH-44 kimberlites. One RC hole planned for CH-6 was designed to provide additional information to permit potential conversion of the current Inferred Resource to an Indicated Resource category. A summer 2015 core drilling program planned for CH-6 is designed to establish an Inferred Resource for that portion of kimberlite occurring shallower than 250 metre depth that currently is considered a Target for Further Exploration. At CH-44, three RC holes were planned to allow inclusion of a potential maiden resource in the planned 2016 PEA. As the potential resource base at CH-44 is less than those at each of CH-6 and CH-7, priority was placed on completing the RC drilling at CH-7. A program designed to establish a maiden resource at CH-44 is planned for 2016. The shallow overburden at CH-44 will allow a bulk sample to be collected by cost-effective surface trenching.

Peregrine plans to complete a PEA in 2016 as scheduled, which should not be delayed by the absence of large diameter RC bulk sampling information from CH-6 and CH-44. The PEA is intended to be based on the Inferred Resources declared for the highest priority kimberlites based on size and diamond grade, CH-6 and CH-7. The tonnage, grade and diamond value for CH-6 and CH-7 that will be used in the PEA will be finalized after completion of the Summer 2015 drill program and receipt of results from the CH-7 bulk sample. Any resource established at CH-44 would be integrated into subsequent Chidliak economic studies.

Mr. Tom Peregoodoff, President and CEO of Peregrine stated “The successful collection of the bulk sample from the CH-7 kimberlite will enable Peregrine to determine the grade and diamond value and this information would be used to declare an Inferred Resource for this kimberlite. We believe that a PEA based on Inferred Resources at CH-6 and CH-7 will demonstrate that there is potential for Chidliak to be developed into Baffin Island’s first diamond mine. CH-6 is one of the highest grade kimberlites in the world with an Inferred Resource of 8.57 million carats in 3.32 million tonnes of kimberlite. With an actual diamond value of US$213 per carat based on a 1,013 carat parcel of diamonds, this pipe alone has tremendous potential for development. The winter of 2015 was difficult for operations, and credit should be given to the Peregrine team and its contractors for completing this year’s bulk sample program under challenging weather conditions.”

The CH-7 bulk sample was collected by large diameter RC drilling (up to 26 inch/66 cm diameter holes). A total of 1,212.1 metres was drilled in six holes resulting in the collection of 653 bags of kimberlite weighing a total of 558.5 wet tonnes after screening on a shaker table with a 1.18 mm square mesh screen. Sample weights suitable for use in resource definition will be determined using moisture content, calculated drill hole volume based on caliper data and kimberlite specific gravity data. Table 1 provides a summary of the drilling. A total of 576 sample bags has already been transported to Iqaluit. Peregrine plans to transport the 77 bags remaining on site to Iqaluit primarily by fixed wing aircraft. The bulk sample bags are securely stored in Iqaluit and will be shipped for processing and diamond recov