New Kimberlite Discoveries at Aviat


Stornoway Diamond Corporation (TSXV-SWY) is pleased to announce that initial summer prospecting and till sampling work on the 5.5 million acre Aviat Project in eastern Nunavut has identified new kimberlite float occurrences along a 20 km long, 1.5 km wide trend in the vicinity of but distinct from previously identified diamondiferous kimberlites AV-1 and AV-2. Two of the new float occurrences, referred to as AV-3 and AV-4 respectively, consist of multiple boulders and cobbles ranging from 5 cm up to 1.5 m in size and suggest proximal sources. Samples have been collected for indicator mineral and caustic fusion analysis and ground geophysics is underway in the vicinity of both occurrences to help define targets for drilling. Overall, the kimberlite float displays characteristics similar to AV-1 and AV-2 and appears to be dominated by macrocrystic, hypapyssal type I kimberlite. Kimberlitic indicator minerals, including olivine, garnet and ilmenite have been commonly observed throughout the trend and are evident at both occurrences described above.

The summer prospecting program began in early August and has so far focused on the Tremblay corridor in the vicinity of the diamondiferous AV-1 and AV-2 kimberlites. A total of 58 occurrences have been mapped within the float trend in proximity to anomalous till samples taken in 2002 and 2003 suggesting multiple additional source bodies. The Tremblay corridor extends for more than 75 km and varies between 3 and 8 km in width and contains numerous kimberlitic indicator mineral anomalies identified from the 2003 till sampling program. Partial microprobe results received as of August 13, 2004 continue to confirm the overall high diamond prospectivity of the region. A total of 330 samples analysed to date have returned probe confirmed kimberlitic grains, including several samples with high proportions of G10 garnets suggestive of possible provenance from diamondiferous source bodies. A total of 607 pyrope garnets have been probe-confirmed from Aviat to date, approximately 30% of which are classified as G10 garnets. While most of the encouraging mineral chemistry is associated with the Tremblay corridor, both down and up ice of the AV-1 and AV-2 kimberlites, additional encouraging results have been returned from regional samples located elsewhere within the project area. Prospecting will continue both within the Tremblay corridor and regionally throughout the Aviat property over the next four weeks to further delineate the nature, extent and source of the kimberlite float trains and to continue to explore for new occurrences coincident with anomalous till samples.

As part of the 2004 exploration program, Stornoway has collected 6,200 line kilometers of fixed wing gravity gradiometer surveying using BHP Billiton's proprietary Falcon survey equipment within and along the Tremblay Corridor. Preliminary results of this work are expected in late September of 2004. Approximately 7,500 line kilometers of helicopter magnetic and electromagnetic data has been collected so far this spring and a further 20,000 km will be collected before the end of the season. Some 33 ground geophysical grids have been completed over targets of potential interest, and this survey work is ongoing. Drilling will commence later in August. The 2004 field program is under the supervision of Dean Besserer, P. Geol. of APEX Geoscience Ltd., a Qualified Person under NI 43-101.

Aviat is being explored under a joint venture between Stornoway (70%), BHP Billiton plc (20%) and Hunter Exploration Group (10%), and hosts the diamondiferous AV-1 and AV-2 kimberlites, discovered from prospecting during 2002 and 2003, respectively. AV-1 and AV-2 represent the first diamond discoveries on the Melville Peninsula and helped precipitate one of the largest land rushes in Canadian history, with over 90 million acres having been acquired for diamond exploration in the eastern arctic by early 2004. Exploration expenditures of approximately $12 million have been budgeted for Aviat in 2004.

Stornoway has been involved in 22 kimberlite discoveries in Nunavut since 2002 and currently maintains interests in more than 20 million acres of prospective landholdings throughout northern Canada that will be explored under a preliminary budget of $20 million for 2004. Stornoway's contribution to the budget is expected to exceed $12 million.

On behalf of the Board

/s/ "Eira Thomas"

Eira Thomas

For further information, please contact the Company at 604-687-7545 or (888) 338-2200
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