Stornoway Announces Award of Contract for Renard Feasibility Study

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 09/30/10 -- Stornoway Diamond Corporation (TSX: SWY) is pleased to announce that SNC-Lavalin Inc. has been awarded the lead contract for the preparation of the Renard Diamond Project Feasibility Study. SNC-Lavalin is an international engineering and construction firm headquartered in Montreal, Quebec. The SNC-Lavalin contract will cover principal mine design and engineering work, with AMEC Americas Limited to be retained to provide diamond mining and processing expertise under subcontract. The Renard Diamond Project is a 50:50 joint venture with DIAQUEM a wholly-owned subsidiary of SOQUEM INC., itself a wholly-owned subsidiary of Societe generale de financement du Quebec ('SGF'), the Quebec government's main industrial and financial holding company.

Matt Manson, President and CEO, commented: 'The award of the lead contract for the Renard Feasibility Study is an important milestone for the project. We are very pleased to have retained a team with broad experience in recent Canadian diamond mine development and in the Quebec mining sector. The Feasibility Study will form an important component of our overall program of mine design, social and environmental assessment and permitting that is being overseen by our Quebec based mine development team.'

In March 2010, Stornoway released the results of an updated Preliminary Assessment at Renard which outlined a base case estimate of pre-tax Net Present Value of C$885 million (at an 8% discount rate) and an Internal Rate of Return of 24.8%. This study showed the project to have the potential to produce approximately 30 million carats of diamonds over a 25-year mine life based on the currently defined National Instrument ('NI') 43-101 Indicated and Inferred Resources. The Renard Feasibility Study will build upon this initial work, and will examine best-case mine optimization scenarios, including the expansion of processing capacity from 5,000 to 7,000 tonnes per day. Work elements will include open pit and underground mine design, production scheduling, diamond process plant design, and metallurgical testing. Site infrastructure design will include such elements as worker accommodations, warehousing, maintenance infrastructures, and onsite power generation. Mineral Resource and Reserve estimation, and certain specialized aspects of mine design, will be completed under separate contracts awarded by Stornoway to other consultants directly. The Feasibility Study is expected to be substantially completed by the third quarter of 2011.

About Stornoway Diamond Corporation

Stornoway Diamond Corporation is one of Canada's leading diamond exploration and development companies, involved in the discovery of over 200 kimberlites in seven Canadian diamond districts. The Company benefits from a diversified diamond property portfolio, a strong financial platform and management and technical teams with experience in each segment of the diamond 'pipeline' from exploration to marketing.

About SGF

Societe generale de financement du Quebec (sgfqc.com), an industrial and financial holding company, has a mission to carry out economic development projects, particularly in the industrial sector, in cooperation with partners and in compliance with accepted profitability requirements and with the economic development policy of the Quebec government. As part of its new mandate, SGF is authorized by the Quebec government to go beyond its traditional role as an equity investor by offering complementary solutions, such as loans, debentures or preferred shares.

SOQUEM, a wholly-owned subsidiary of Societe generale de financement du Quebec, is to undertake exploration, development and mining activities throughout the province of Quebec.

About the Renard Diamond Project

The Renard Diamond Project is located approximately 250km north of the community of Mistissini in the James Bay region of North-Central Quebec, and falls within the environmental protection regime of the James Bay and Northern Quebec Agreement. Based on the March 2010 Preliminary Assessment, total capital investment is currently estimated to be $511 million, with an average operating expenditure of approximately $67 million per year and a workforce of 300 people. Pending the completion of all applicable mine feasibility and environmental and social impact assessments, the receipt of all regulatory approvals, and a positive production decision by the project partners, Stornoway currently anticipates mine production to commence by the end of 2013.

On behalf of the Board

STORNOWAY DIAMOND CORPORATION

Matt Manson, President and Chief Executive Officer

This document contains 'forward-looking information' within the meaning of Canadian securities legislation and 'forward-looking statements' within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as 'forward-looking statements' are made as of the date of this document and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by law.

Forward-looking statements relate to future events or future performance and reflect current expectations or beliefs regarding future events and include, but are not limited to, statements with respect to: (i) the amount of mineral resources and potential mineral deposits; (ii) the amount of future production over any period; (iii) net present value and internal rates of return of the proposed mining operation; (iv) capital costs and operating costs; (v) mine expansion potential and expected mine life; and (vi) expected time frames for completion of permitting and regulatory approvals, completion of a Feasibility Study and making a production decision. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as 'expects', 'anticipates', 'plans', 'projects', 'estimates', 'assumes', 'intends', 'strategy', 'goals', 'objectives' or variations thereof or stating that certain actions, events or results 'may', 'could', 'would', 'might' or 'will' be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.

All forward-looking statements are based on Stornoway's or its consultants' current beliefs as well as various assumptions made by and information currently available to them. Many of these assumptions are set forth in the news release and include: (i) estimates of net present value and internal rates of return; (ii) estimates of potential production and duration of mine life; (iii) estimated completion date for the Feasibility Study; (iv) required capital investment and estimated workforce requirements; (v) receipt of regulatory approvals on acceptable terms within commonly experienced time frames; (vi) the assumption that the partners will make a production decision, and that decision will be positive; (vii) anticipated timelines for the commencement of mine production. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many forward-looking statements are made assuming the correctness of other forward looking statements, such as statements of net present value and internal rate of return, which are based on most of the other forward-looking statements and assumptions herein. The cost information is also prepared using current values, but the time for incurring the costs will be in the future and it is assumed costs will remain stable over the relevant period.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates expressed above do not occur, including the assumption in many forward-looking statements that other forward-looking statements will be correct, but specifically include, without limitation, risks relating to variations in the grade, kimberlite lithologies and country rock content within the material identified as mineral resources from that predicted, variations in rates of recovery and breakage; the greater uncertainty of potential mineral deposits, developments in world diamond markets, slower increases in diamond valuations than assumed, risks relating to fluctuations in the Canadian dollar and other currencies relative to the US dollar, increases in the costs of proposed capital and operating expenditures, increases in financing costs or adverse changes to the terms of available financing, if any, tax rates or royalties being greater than assumed, results of exploration in areas of potential expansion of resources, changes in development or mining plans due to changes in other factors or exploration results of Stornoway or its joint venture partners, changes in project parameters as plans continue to be refined, risks relating to receipt of regulatory approvals or settlement of an Impact and Benefits Agreement, the effects of competition in the markets in which Stornoway operates, operational and infrastructure risks and the additional risks described in Stornoway's most recently filed Annual Information Form, annual and interim MD&As, and Stornoway's anticipation of and success in managing the foregoing risks. Stornoway cautions that the foregoing list of factors that may affect future results is not exhaustive. When relying on our forward-looking statements to make decisions with respect to Stornoway, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Stornoway does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by Stornoway or on our behalf, except as required by law.

Contacts:

Stornoway Diamond Corporation

Matt Manson

President and CEO

416-304-1026


Stornoway Diamond Corporation

Nick Thomas

Manager Investor Relations

604-983-7754, toll free at 1-877-331-2232
info@stornowaydiamonds.com
www.stornowaydiamonds.com