Stornoway Diamond Corporation (TSXV-SWY) is pleased to report that it has acquired over 5.8 million additional acres of federal prospecting permits and claims in eastern Nunavut and has entered into a strategic alliance with BHP Billiton to explore new landholdings on the Melville Peninsula.
On February 2nd, 2004 a further 5.5 million acres of permits were granted on the south central portion of the Melville Peninsula situated north of BHP Billiton's Qilalugaq (Area 8) property and immediately south of the Aviat Project. In addition, 378,336 acres of claims comprising the Alexis property have been staked surrounding and adjacent to BHP Billiton's Qilalugaq property, where nine new diamondiferous kimberlite discoveries were reported last month. Stornoway and BHP Billiton have entered into a 50:50 agreement to jointly explore these new permits and claims. In addition, permits totaling 284,547 acres were acquired on Wales Island, situated immediately west of the Melville Peninsula. These landholdings will be explored under an agreement between Stornoway, BHP Billiton, and Navigator Exploration Corp, with each company holding an initial 33.3% interest.
Eira Thomas, President of Stornoway commented: "The new diamond discoveries made at Stornoway's Aviat and BHP's Qilalugaq in 2003 confirm the high regional potential of the Melville Peninsula. Close to 6 million acres of new ground has been acquired in and around these discoveries which significantly increases Stornoway's exposure to this prospective but vastly underexplored area. Stornoway is very pleased to be joining forces with BHP Billiton to leverage our respective knowledge and exploration expertise in the area."
Stornoway now maintains varying interests in more than 12 million acres of prospective diamond properties throughout the Melville Peninsula, including a 70% interest in the 5.5 million acre Aviat Project where the discovery of the diamondiferous AV-1 and AV-2 kimberlites were announced last year. Approximately $5 million was spent at Aviat in 2003 on an aggressive program that included the collection of roughly 2,300 till samples for indicator minerals, 55,000 line km of airborne magnetics, 1,900 line km of airborne electromagnetics, prospecting, ground geophysical surveying, the collection of approximately 8 tonnes of kimberlite from the surface exposure of AV-1 and 1,102m of core drilling. A much larger drilling campaign is planned for early in 2004, following the receipt and interpretation of data from 2003. Aviat is a joint venture between Stornoway (70%), BHP Billiton (20%) and Hunter Exploration Group (10%).
Shear Minerals Ltd., Stornoway and BHP Billiton also acquired a further 138 federal prospecting permits totaling 6.4 million acres surrounding and immediately adjacent to the Churchill Diamond Project near the community of Rankin Inlet, Nunavut. The Joint Venture's landholdings now encompass mineral rights to more than 8 million acres of prospective diamond ground. Airborne geophysical surveys have identified more than 400 geophysical anomalies on the property to date, of which 26 have been drill tested. This drill testing has identified 16 kimberlites on the main Churchill area and an additional two on the International Samuel Churchill West area. It is anticipated that approximately $6 million will be spent on the Churchill properties in 2004. Shear has a 51% interest in the project and is operator. Stornoway and BHP Billiton have 35% and 14% interests respectively.
On behalf of the Board
STORNOWAY DIAMOND CORPORATION
/s/ "Eira Thomas"
Eira Thomas
President
This news release contains forward-looking statements regarding ongoing and upcoming exploration work and expected geology, geological formations and structures. Actual results may differ materially from those anticipated in these statements.
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