DIAMOND STUDY: Renard economic outlook positive

QUEBEC STORNOWAY DIAMOND CORP. of Vancouver and 50:50 joint venture partner SOQUEM of Quebec City have received a positive economic study for the Renard diamond project in north-central Quebec. The study includes a 43-101-compliant resource estimate, a processing plant design, mine plant, plus capital and operating cost estimates.

Here are the highlights:

The mineral resource includes 7.0 million ct of in the indicated category (11.6 million tonnes at an average grade of 60 cpht) and 4.5 million ct in the inferred category (7.2 million tonnes at an average grade of 63 cpht).

Projected capital cost are $308 million (including contingency), and the average life-of-mine operating cost are expected to be $50.39/tonne. These estimates are conceptual in nature for both open pit and underground mining.

The economic assessment is based on a base case 5.8 million ct resource with a pre-tax IRR of 13.9% (11.8% after tax), and an NPV of $52 million (calculated before tax at an 8% discount rate). Pre-tax IRR increases to 16.4% (13.9% after tax), with an NPV of $78m, based on an economic assessment that applies an alternate diamond price to the Renard 4 kimberlite pipe.

The Renard property also contains an additional 9 to 21 million ct classified as potential mineral deposit (14 to 32 million tonnes ranging from 31 to 164 cpht). Stornoway cautioned readers that such "potential" deposits do not meet 43-101 standards.

Stornoway's CEO Eira Thomas said, "More than ever, we remain confident that Renard will become Quebec's first diamond mine in a few short years."

The Renard project is located within the Foxtrot property in the Otish Mountains. Details are available at www.StornowayDiamonds.com.