2004 CHURCHILL DIAMOND PROJECT UPDATE Six additional kimberlite discoveries


Shear Minerals Ltd. (SRM:TSXV), Stornoway Diamond Corporation (SWY:TSX), and BHP Billiton Diamonds Inc. announced today that the field component of the 2004 exploration program on the Churchill Diamond Project, Nunavut, is now complete.

The fall 2004 drill program completed eleven holes that tested eleven geophysical targets, all located within one of two indicator mineral corridors. A total of five holes were located in the southern corridor and discovered three new kimberlitic bodies. A total of six holes were located in the Josephine River Corridor of which three intersected new kimberlitic bodies. A table of detailed results will be posted at www.shearminerals.com.

Representative kimberlite samples from the drill targets have been shipped and received by the Saskatchewan Research Council (SRC), an independent laboratory, for micro-diamond analysis. Results will be released as soon as they are available. Samples have also been collected for petrographic and indicator mineral analysis to fully asses the diamond potential of these discoveries.

The field program on the Churchill Project was terminated early due to the rapid deterioration in the weather and the difficulty of reaching drill targets and operating safely. Conditions in general in the North have been challenging for the industry this year, resulting both in a later than usual summer start and an early shut-down.

Those targets not drilled in 2004 will be considered in the spring 2005 program along with other lake-bound targets and new targets identified in the detailed helicopter-borne Mag/EM data collected this summer. The spring drilling program is planned to commence in the first quarter of 2005 and together with the targets drilled this summer, will test up to 40 targets.

The Churchill Diamond Project is host to high interest G10 mineral chemistry and the partners continue to narrow down the source to these high interest grains. During 2004, a total of 4,213 till samples were collected on the property and subsequently shipped to the SRC for processing and analysis. To date, 1,732 samples have been processed and 275 picked with results received. Since 2001, more than 2,700 microprobe-confirmed diamond indicator mineral grains have been recovered from 738 till samples, representing 38% of all samples taken.

Approximately 27% of all pyrope garnets are G10 subcalcic pyropes that plot to the left of the 85% line defined by Gurney (1984), implying derivation from within the diamond stability window. These samples are largely contained within four corridors approximately 15km wide. Within the main Josephine River Corridor, a distinct and well preserved cold geotherm (35mW/m2) indicates a large diamond stability window in the mantle beneath the project area.

The ongoing sampling program is an integral part of identifying drill targets in order to locate the source of the property's high-interest indicator mineral chemistry.

In 2004, a high resolution helicopter-borne airborne EM-magnetic survey totaling 33,613 line km was
conducted on the Churchill property. A total of 690 targets have been identified in the preliminary data from the first half of the survey. Since 2002, a total of 55,521 line km of fixed wing magnetics has been flown on the project, including 16,575 line-km flown in 2004. The airborne data collected this year is currently being interpreted.

The 8.5 million acre Churchill Diamond project, located near the community of Rankin Inlet in the Kivalliq region of Nunavut is a new and expanding kimberlite district which Shear and its partners discovered in 2003. Success at Churchill has contributed to a major staking rush in the eastern arctic where diamond exploration investment is expected to exceed $100 million in 2004. Shear has a 51% interest in the project and is operator. Stornoway Diamond Corp. and BHP Billiton Diamonds Inc. have 35% and 14% interests respectively. The 2004 field program is under the supervision of Jennifer Burgess, P. Geol., a Qualified Person under NI 43-101.

On behalf of the Board
/s/ "Eira Thomas"
Eira Thomas

For further information, please contact the
Company at 604-331-2259 or 1-888-338-2200

On behalf of the Board
/s/ "Pamela Strand"
Pamela Strand, P. Geol.

For further information, please contact the
Company at 780-435-0045 or 1-866-298-9695


For further information, please contact the Company at 604-331-2259 or (888) 338-2200
** Website: www.stornowaydiamonds.com Email: info@stornowaydiamonds.com **

This news release may contain forward looking statements, being statements which are not historical facts, including, without limitation, statements regarding potential mineralization, exploration results, resource or reserve estimates, anticipated production or results, sales, revenues, costs, "best-efforts" financings or discussions of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based upon a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. Important factors that could cause actual results to differ materially from the Company's expectations are in Company documents filed from time to time with the Toronto Stock Exchange and provincial securities regulators, most of which are available at www.sedar.com. The Company disclaims any intention or obligation to revise or update such statements.