Peregrine Announces Modelled Values of US$43 to US$70 Per Carat for DO-27 Bulk Sample Diamonds

December 17, 2007 PDF version
Vancouver, British Columbia, Canada - Monday, December 17, 2007 - Brooke Clements, President of Peregrine Diamonds Ltd. (“Peregrine”) (TSX: PGD) is pleased to report modelled diamond values for 2,075 carats of diamonds recovered from the nine hectare DO-27 kimberlite pipe, WO Diamond Project, NT, Canada. The average modelled value ranged from US$43 to US$70 per carat, with a “Base Case” average of US$51 per carat. The valuation was completed in Antwerp, Belgium under the supervision of WWW International Diamond Consultants Ltd. (“WWW”), an internationally recognized diamond valuation and consultancy company. These valuation results, along with updated grade and geological information, will be used by Peregrine and AMEC Americas Ltd. (“AMEC”) to complete the Preliminary Technical Assessment (“PTA”) report, which will investigate the current economic potential of DO-27.

DIAMOND VALUATION RESULTS

The cumulative 2,075 carat diamond parcel was acquired by large diameter, reverse circulation bulk sample drilling campaigns completed by Peregrine in 2005, 2006 and 2007. All of the diamonds valued are from the Main Lobe and Northeast Lobe pyroclastic kimberlite (“PK”) units. An additional 188 carats that were recovered from other minor, volumetrically insignificant, Northeast Lobe lithologies in 2006 and 2007 were not included in the valuation model as these lithologies may not be included in the final resource model. Detailed information on the three bulk sampling campaigns can be found in Peregrine press releases dated June 14, 2005, September 5, 2006 and September 18, 2007.

The valuation results are summarized in the table below.

DO-27 DIAMOND VALUATION RESULTS
Bulk Sampling Program Weight Of Valuation Sample (Carats)(1) Largest Diamonds (Carats) “Base Case” Diamond Price Model (US$/Carat)(2) “High” Diamond Price Model (US$/Carat)(2) “Low” Diamond Price Model (US$/Carat)(2)
2007 1,566 9.45, 7.03, 6.03, 5.17, 4.84, 4.35, 4.19 $52 $72 $39
2006/2005 509(3) 7.11, 3.91, 2.34 $46 $62 $41
Combined 2,075(4)
$51 $70 $43
(1) Sample weights represent the total carat weight of diamonds presented for valuation following the combination of individual sub-samples and after acid cleaning.
(2) As determined by WWW International Diamond Consultants Ltd.
(3) Values from the WWW October, 2006 price book, as reported by Peregrine on November 6, 2006.
(4) The combined sample was re-priced and modelled based on the WWW October 31, 2007 price book.


The modelled price estimates for DO-27 represent an average diamond price in the rough diamond market in November, 2007 that might reasonably be expected, based on standard production-scale recoveries of commercial sized diamonds greater than 1.00 mm in size.

The most valuable diamonds in the 2007 parcel were a 4.35 carat fancy yellow octahedron and a 4.19 carat white stepped octahedron, both valued at US$1,900 per carat (see photograph here).

In addition to determining a modelled average price, WWW showed a 1,123 carat parcel from the Main Lobe PK lithology from the 2007 bulk sample to four other internationally recognized, Antwerp-based rough diamond valuators in order to obtain additional market-based, unmodelled valuations. This parcel was selected for spot price valuation as it was the single largest representative parcel of Main Lobe PK diamonds. Average October, 2007 spot prices for the 1,123 carat parcel of US$46, US$48, US$52 and US$56 per carat respectively were determined by