April 2, 2018
Peregrine Diamonds Ltd. (“Peregrine” or “the Company”) (TSX:PGD) is pleased to announce the filing of a National Instrument (“NI”) 43-101 technical report titled “2018 Technical Report: Mineral Resource update for the Chidliak Project, Baffin Island, Nunavut, Canada” and dated effective February 15, 2018 (the “Technical Report”) for its 315,123-hectare Chidliak project, located approximately 120 kilometres north-east of Iqaluit, the capital of Nunavut. The Technical Report is an update to a report with an effective date of June 3, 2016 and supports an updated 17.96 million carat Inferred Resource at CH-6 that was announced by a news release dated February 15, 2018, and a 4.23 million carat Inferred Resource at CH-7 that was announced May 5, 2016.
The Technical Report summarizes the work completed in 2017 as part of the Chidliak Diamond Resource Development Program, which focused on core drilling and microdiamond sampling at CH-6. Material outcomes of the 2017 work program were summarized in a news release dated November 28, 2017.
PRELIMINARY ECONOMIC ASSESSMENT UPDATE
Work on the Preliminary Economic Assessment by JDS Energy and Mining Inc. (“JDS”) continues on schedule. Peregrine expects to receive the initial results in late June as previously announced.
Catherine Fitzgerald, P.Geo., Dr. Herman Grütter, P.Geo., and Dr. Jennifer Pell, P.Geo., all of Peregrine Diamonds Inc., prepared the updated CH-6 Inferred Mineral Resource estimate. Dino Pilotto, P.Eng. of JDS, consults to Peregrine and expressed opinion on reasonable prospects for economic extraction of the CH-6 Inferred Mineral Resource.
Ms. Fitzgerald, Dr. Grütter, Dr. Pell, Mr. Pilotto are Qualified Persons in terms of NI 43-101 standards of disclosure and have reviewed this release and approve of its contents.
ABOUT PEREGRINE DIAMONDS
Peregrine Diamonds is a TSX-listed diamond exploration and development company with its primary assets located in northern Canada.
Peregrine’s core asset is its 100-percent-owned, 315,123-hectare Chidliak Project, located 120 kilometres from Iqaluit, the capital of Nunavut, where 74 kimberlites have been discovered to date, with eight being potentially economic. A Preliminary Economic Assessment (“PEA”) of a Phase One Diamond Development (“CP1D”) has been completed. The PEA highlights that the CP1D represents a robust, high-margin, ten-year, open-pit mining project with very attractive economics, including after-tax NPV of C$471 million, IRR of 29.8%, and a two-year payback. An Inferred Mineral Resource of 17.96 million carats in 7.46 million tonnes of kimberlite at an average grade of 2.41 carats per tonne has been defined for a portion of the CH-6 kimberlite. An independent diamond valuation by WWW International Diamond Consultants, of a 1,013 carat parcel of diamonds from CH-6, returned an average market price of US$213 per carat and modeled prices that range from a minimum of US$162 per carat to a high of US$236 per carat, with a base model price of US$188 per carat (all using the February 24, 2014 price book). In addition, a Target for Further Exploration (“TFFE”) of 1.09 to 2.35 million tonnes of kimberlite to a depth of 590 metres below surface has been identified at CH-6. An Inferred Mineral Resource of 4.23 million carats in 4.99 million tonnes of kimberlite at an average grade of 0.85 carats per tonne has been defined for a portion of the CH-7 kimberlite. An independent diamond valuation by WWW International Diamond Consultants of a 735.75 carat parcel of diamonds from CH-7 returned an average market price of US$100 per carat and modelled prices that ranged from a minimum of US$94 per carat to a high of US$155 per carat, with a base model price of US$114 per carat (all using the February 1, 2016 price book). In addition, TFFE of 0.90 to 2.36 million tonnes for a depth range of 240 to 320 metres has been estimated for the CH-7 kimberlite. A TFFE of 1.27 to 3.19 million tonnes to 250 metres depth has been estimated for the CH-44 kimberlite pipe.
Additional details of the Chidliak 2016 PEA are available in a National Instrument (“NI”) 43-101 technical report titled “Preliminary Economic Assessment Technical Report on the Chidliak Project, Nunavut, Canada” and dated effective July 7, 2016, available on SEDAR and the Company’s website.
The Chidliak 2016 PEA is preliminary in nature and 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. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. There is no certainty that the PEA will be realized.
Peregrine also controls the 8,494-hectare Lac de Gras Project in the Northwest Territories, lo