Kennady Diamonds Announces 2013 Summer Diamond Recovery Results from Kelvin Kimberlite

Kelvin summer sample grade 4.56 carats per tonne
Kelvin 2013 sample grade 5.38 carats per tonne
1.06 carat, 0.83 carat and 0.53 carat diamonds recovered

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TORONTO, Dec. 16, 2013 /CNW/ - Kennady Diamonds Inc. ("Kennady Diamonds", the "Company") (TSX-V: KDI) is pleased to announce the diamond recovery results from the 2013 Kelvin summer drill program at the 100 percent controlled Kennady North diamond project, located in Canada's Northwest Territories.

Approximately 3,454 kilograms of kimberlite was recovered from 21 holes drilled at the Northwest Lobe of the Kelvin kimberlite. The kimberlite was processed at the Geoanalytical Laboratories Diamond Services at the Saskatchewan Research Council, which is accredited to the ISO/IEC 17025 standard by the Standards Council of Canada as a testing laboratory for diamond analysis using caustic fusion.

The 2013 Kelvin summer drill program, with results summarized in Table 1 below, returned an average sample grade of 4.56 carats per tonne.

Table 1 - Kelvin 2013 Summer Diamond Recovery Results

Total Weight (Kg)	Number of Diamonds According to Sieve Size Fraction (mm)												Total Diamonds
	+0.106 -0.150	+0.150 -0.212	+0.212 -0.300	+0.300 -0.425	+0.425 -0.600	+0.600 -0.850	+0.850 -1.180	+1.180 -1.700	+1.700 -2.360	+2.360 -3.350	+3.350 -4.750	+4.750
3,314	3,753	3,219	1,996	1,349	713	432	214	94	43	7	4	0	11,824

*Total weight of sample 15.11 carats
*Sample grade: 4.56 carats per tonne

Kennady Diamonds CEO Patrick Evans commented: "2013 has been a remarkably successful year for Kennady Diamonds. Our two drill campaigns have produced results which far exceeded our expectations. We recovered a total of 4.3 tonnes of kimberlite from Kelvin containing more than 16,000 microdiamonds of which 474 are commercial size diamonds. The Kelvin summer drill program returned an outstanding sample grade of 4.56 carats per tonne and the winter program returned an exceptional sample grade of 8.13 carats per tonne, for a combined sample grade of 5.38 carats per tonne. These are amongst the highest kimberlite sample grades ever recorded and confirm that the Kelvin kimberlite has both a coarse diamond size distribution as well as the potential to host a high grade diamond resource".

Table 2 below provides details of the number and weight of the plus 0.85mm "commercial" size diamonds recovered from the Kelvin summer drill program. Diamonds larger than 0.85mm can be sorted into categories with different price points and are considered, under Canadian Institute of Mining ("CIM") guidelines, to have "commercial" characteristics.

Table 2 - Kelvin 2013 Summer "Commercial" Size Diamonds

	Sieve Size Fraction (mm)
	+0.850  -1.180	+1.180  -1.700	+1.700  -2.360	+2.360  -3.350	+3.350  -4.750	+4.750	Total	Sample Grade (carats/tonne)
Number of Diamonds	214	94	43	7	4	0	362
Weight (ct)	2.1069	2.2354	2.0089	2.1726	2.9033	0	11.4271	3.4481

*Total sample weight 3,314kg
*Total sample grade 4.56 carats/tonne

Table 3 below provides details of the characteristics of some of the largest diamonds recovered from the Kelvin 2013 summer drill program.

Table 3 - Kelvin Summer 2013 Diamond Characteristics

Weight (carats)	Length  (mm)	Width (mm)	Height  (mm)	Description
1.06	7.00	4.50	3.30	Off-white, transparent, broken aggregate, inclusions
0.83	5.40	4.00	3.40	White/colorless, transparent, octahedral, broken, inclusions
0.53	4.80	4.00	2.70	Off-white, transparent, octahedral, no inclusions
0.49	5.00	3.60	3.00	Off-white, transparent, octahedral, minor inclusions
0.42	4.00	3.00	2.50	Off-white, transparent, octahedral, no inclusions

A total of 362 commercial size diamonds were extracted from 3,314 kilograms of kimberlite from the Kelvin 2013 summer drill program. By comparison, 112 commercial size diamonds were recovered from approximately 1,000 kilograms from the Kelvin 2013 winter drill program. This illustrates a high degree of consistency between the 2013 summer and winter samples of approximately one commercial size diamond for every nine kilograms of kimberlite.

While the 362 commercial size diamonds from the 2013 Kelvin summer drill program were recovered from the Northwest Lobe of the Kelvin kimberlite, the 110 commercial size diamonds recovered from the 2013 winter program came from sixteen different drill holes across the approximate 1 kilometer strike of the Kelvin kimberlite. Based on this, it is apparent that the Kelvin kimberlite hosts commercial size diamonds across the length and breadth of the kimberlite.

As announced on August 6, 2013, the 2013 Kelvin winter drill program (summarized in Table 4 below) returned an exceptional sample grade of 8.13 carats per tonne, which included an extraordinary 2.48 carat diamond.

Table 4 - Kelvin 2013 Winter Diamond Recovery Results

Total Weight (Kg)	Number of Diamonds According to Sieve Size Fraction (mm)												Total Diamonds
	+0.106 -0.150	+0.150 -0.212	+0.212 -0.300	+0.300 -0.425	+0.425 -0.600	+0.600 -0.850	+0.850 -1.180	+1.180 -1.700	+1.700 -2.360	+2.360 -3.350	+3.350 -4.750	+4.750
987	1,590	1,043	668	468	246	170	65	32	9	3	2	1	4,297

*Total weight of the sample 8.02 carats
*Sample grade 8.13 carats/tonne

Table 5 below provides details of the number and weight of the plus 0.85mm "commercial" size diamonds recovered from the 2013 Kelvin winter drill program.

Table 5 - Kelvin 2013 Winter "Commercial" Size Diamonds

	Sieve Size Fraction (mm)
	+0.850 -1.180	+1.180 -1.700	+1.700  -2.360	+2.360  -3.350	+3.350  -4.750	+4.750	Total	Sample Grade (carats/tonne)
Number of Diamonds	65	32	9	3	2	1	112
Weight (ct)	0.7383	0.9922	0.7283	0.5598	1.6504	2.4789	7.1479	7.2420

*Total sample weight 987kg
*Total sample grade 8.13 carats/tonne

Table 6 below summarizes the total 2013 Kelvin diamond recovery results, combining the 2013 winter and summer results.

Table 6 - Total Kelvin 2013 Diamond Recovery Results

Total Weight (Kg)	Number of Diamonds According to Sieve Size Fraction (mm)												Total Diamonds
	+0.106 -0.150	+0.150 -0.212	+0.212 -0.300	+0.300 -0.425	+0.425 -0.600	+0.600 -0.850	+0.850 -1.180	+1.180 -1.700	+1.700 -2.360	+2.360 -3.350	+3.350 -4.750	+4.750
4,301	5,343	4,262	2,664	1,817	959	602	279	126	52	10	6	1	16,121

*Total weight of sample 23.13 carats
*Total sample grade 5.38 carats/tonne

Table 7 below provides details of the total number and weight of the plus 0.85mm "commercial" size diamonds recovered in total during 2013.

Table 7 - Total Kelvin 2013 "Commercial" Size Diamonds

	Sieve Size Fraction (mm)
	+0.850  -1.180	+1.180  -1.700	+1.700  -2.360	+2.360  -3.350	+3.350  -4.750	+4.750	Total	Sample Grade (carats/tonne)
Number of Diamonds	279	126	52	10	6	1	474
Weight (ct)	2.8452	3.2276	2.7372	2.7324	4.5537	2.4789	18.5750	4.3188

*Total sample weight 4,301kg
*Total sample grade 5.38 carats/tonne

Patrick Evans added: "In addition to the outstanding sample grade, it is very encouraging to see the presence of a number of high quality macro diamonds without any inclusions. Together with grade, diamond quality is a key value driver."

Besides the outstanding sample grade, approximately 60 percent of the diamonds recovered from Kelvin during 2013 are classified as white and transparent. Most of the white diamonds have either no inclusions or only minor inclusions. Approximately 2 percent of the diamonds are classified as yellow and transparent with either no or only minor inclusions. The bulk of the remaining diamonds are classified as off-white and transparent. Photographs of the commercial size diamonds will be posted on the Company's website as soon as they become available.

Following the successful conclusion of the 2013 exploration program, preparations for the 2014 winter exploration program are underway. Further geophysics over the Kelvin and Faraday kimberlites, as well as new exploration targets outside of the Kelvin - Faraday kimberlite corridor, is scheduled to commence in February 2014. This will be followed in March 2014 by a much expanded drill program, including more than 10,000 meters of delineation and exploration drilling and the extraction of a mini-bulk sample of approximately 25 to 30 tonnes from the Kelvin kimberlite.

The 2014 winter program is expected to be completed by May with the results being announced in the third quarter of 2014. The Company plans to publish a maiden resource statement for the Kennady North project during the fourth quarter of 2014.

In the interest of time, micro diamonds in the smallest sieve size fraction (+0.075 to -0.106) were not recovered from the 2013 summer sample. While this size fraction usually contains a large number of diamonds, they are very small and of no scientific or commercial value for a diamond project as advanced as Kennady North. For example, 3,139 micro diamonds out of a total of 8,708 diamonds were recovered in this size class from the Kennady North 2013 winter sample. Despite the large number of micro diamonds, exclusion of this size class has no material impact on sample grade or forecasting the distribution of larger stones.

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About Kennady Diamonds
Kennady Diamonds Inc. controls 100 percent of the Kennady North project which comprises thirteen leases and claims located immediately to the north and west of the four leases controlled by the Gahcho Kué Joint Venture between De Beers Canada (51%) and Mountain Province (49%) located in Canada's Northwest Territories.

Kennady Diamonds aims to identify a resource along the Kelvin - Faraday kimberlite corridor of between 5 and 8 million tonnes, and also to identify new kimberlites outside of the corridor. This tonnage estimate is based on the drilling completed to date. The potential quantity is conceptual in nature as there has been insufficient drilling to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource.

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Qualified Person
This news release has been prepared under the supervision of Carl G. Verley, P.Geo., who serves as the qualified person under National Instrument 43-101.

FORWARD LOOKING INFORMATION
This news release includes certain information that may constitute "forward-looking information" under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, the Company's strategic plans, future operations, future work programs and objectives. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE: Kennady Diamonds Inc.

Kennady Diamonds Inc.
Patrick Evans, President and CEO
[phone]
[email protected]