Canadian explorer Peregrine Diamonds has confirmed the presence of diamonds at its Chidliak property, in Canada's Nunavut Territory, the company said on Monday.

The firm discovered the CH-1 kimberlite on the Baffin Island property in July, and two surface samples, weighing a combined 194,9 kg, had since returned 190 diamonds larger than the 0,075 mm sieve size, including 12 diamonds larger than the 0,6 mm sieve size.

The company also reported that it has discovered a second outcropping kimberlite, CH-2, about 1,5 km from CH-1. The new pipe is estimated to be about three hectares in size, while CH-1 is estimated at six hectares.

“This discovery establishes Chidliak as an important new Canadian diamond district, approximately 700 km from the nearest known kimberlite occurrence,” Peregrine said in a statement.

The coarse diamond size distribution indicated the potential for large, commercial-size diamonds in CH-1, the firm said.

"The discovery of two kimberlite pipes and the confirmation of diamonds, so early in the exploration cycle, is rare and bodes well for the diamond potential at Chidliak."

The samples were processed for diamonds by caustic fusion at the Saskatchewan Research Council Geoanalytical Laboratories.

Peregrine has collected a further one-ton sample from CH-1, which it has sent for processing, and a field crew is currently collecting samples from CH-2.

"We expect that more diamondiferous kimberlites will be discovered at Chidliak in the future," said president Brooke Clements.

Independent analyst John Kaiser last month described Peregrine's find on Baffin Island as "decent sized" and commented that the market had "completely ignored" the announcement.

There are currently four producing diamond mines in Canada.

The country's first diamond mine, BHP Billiton's Ekati mine, opened in the Northwest Territories in 1998, followed by the Diavik operation, owned by Rio Tinto and Aber Diamonds (now Harry Winston), in 2003.

Cash strapped Tahera Diamonds closed its Jericho mine earlier this year, two years after starting up, and diamond giant De Beers officially opened its first mines outside Africa, the Snap Lake mine, located 220 km north-east of Yellowknife, in Canada's Northwest Territories and the Victor mine, in Ontario, last month.

Peregrine shares were trading 2,17% higher on Monday afternoon, at C$0,235 a share by 15:56 in Toronto.

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