Name and Location
Renard diamond project, Quebec, Canada.

Client
Stornoway Diamonds.

Project Description
The Renard diamond project is located about 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau, in the James Bay region of north-central Quebec.

An optimisation study on the project has confirmed a robust project.

The study has restated the project has National Instrument 43-101-compliant probable mineral reserves of 17.9-million carats, with a further 17.5-million carats classified as inferred mineral resources, and 23.5-million to 48.5-million carats classified as nonresource exploration upside. All kimberlites remain open at depth.

The November 2011 feasibility study included ramp and shaft access to the Renard underground mine. Shaft sinking will now be deferred until later in the mine life and access to the underground mine will be by way of a ramp only.

This will be developed to a depth of 610 m, sufficient to extract all mineral reserves and the inferred mineral resources, and enlarged to accommodate the planned production rate of 6 000 t/d of ore. Ore will be hauled to surface by 60 t trucks, with ramp ventilation capacity and surface maintenance facilities expanded to accommodate the increased fleet. Plant capacity remains at 6 000 t/d, expandable to 7 000 t/d. Power requirements are expected to total 12.2 MW during operations and to be provided by on-site diesel power generation.

According to the optimisation study, diamond production in years 1 and 2 will be derived predominantly from the Renard 2/3 openpit. Diamond production from the underground mine will start during Year 2. As indicated in the feasibility study, under-ground ore will be mined with blast-hole shrinkage on the 250 m, 430 m and 610 m development levels, with waste backfill from surface. The optimisation study contains a refined draw-point design and a mining sequence incorporating a panel-retreat method to better assure geomechanical stability and mitigate the unexpected onset of natural caving.

Value
As a result of design changes to the project, preproduction capital costs stand at an estimated C$752-million, a reduction of C$50-million from the previous estimate.

Duration
As a result of agreements between Stornoway and the Québec Ministère des Transports, the Ministère des Ressources Naturelles and the Ministère des Finances et de l’Économie (MFE) regarding the completion of the Route 167 Extension and the Renard mine road, as well as a revised financing agreement between Stornoway and the MFE, the new project development schedule assumes first road access to the project site by the fourth quarter of 2013, rather than July 2013, as stated previously. Plant commissioning is now scheduled to begin in December 2015, with commercial production achieved by June 2016, instead of July 2015 and January 2016, as stated previously.

Latest Developments
None stated.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
The cost of the project has been reduced by C$50-million. Plant commissioning has been postponed by six months.

Contact Details for Project Information
Stornoway Diamonds investor relations manager Nick Thomas, tel + 1 604 983 7754 or
email nthomas@stornowaydiamonds.com.