Stornoway Announces Positive Microdiamond Results from Renard 1 Potential for Additional Resources Following Discovery of Diamond Characteristics Similar to Renard 65

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/23/11 -- Stornoway Diamond Corporation (TSX: SWY) is pleased to announce positive microdiamond results from Renard 1, the second largest kimberlite at the Renard Diamond Project, located in North Central Quebec. The Renard Diamond Project, which includes the Renard kimberlite pipes and the Lynx-Hibou system of kimberlite dykes, is a 50:50 joint venture with DIAQUEM INC. ('DIAQUEM'), a wholly-owned subsidiary of SOQUEM INC. ('SOQUEM'), itself a wholly-owned subsidiary of Societe generale de financement du Quebec ('SGF'), the Quebec government's main industrial and financial holding company. On February 10, 2011, Stornoway announced that an agreement to acquire DIAQUEM'S 50% interest in the Renard Diamond Project had been approved by shareholders and is expected to close on April 01, 2011, on which date Stornoway will have acquired 100% ownership of the project. A bankable feasibility study is on schedule for completion in the 3rd quarter of 2011.

Renard 1 was discovered in 2001 and was subsequently drill tested with a total of 11 diamond drill holes representing 1,974 meters (see map of Renard kimberlite locations at http://stornowaydiamonds.com/_resources/airphoto_kimberlite_pipe_locations.pdf). Initial diamond recoveries were low and, at present, Renard 1 does not form part of the project's National Instrument ('NI') 43-101 compliant Mineral Resource (see press release of January 24, 2011). Starting in 2009, Stornoway undertook a review of the pre-existing sampling and geological data at Renard 1, and concluded that the diamond potential of the body had likely been underestimated. In 2010 a single, additional drill hole of 537 meters length was completed, and drill core intersections were sampled to determine microdiamond content by caustic fusion analysis. The results of this work are summarized in the table below.

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                    NUMBER OF DIAMONDS PER SIEVE SIZE (MM SQUARE MESH SIEVE)
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          Sample    0.106    0.150    0.212    0.300    0.425    0.600
          weight       to       to       to       to       to       to
Sample      (kg)  0.150mm  0.212mm  0.300mm  0.425mm  0.600mm  0.850mm Total
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Renard 1  370.78       49       22       15        8        4        2   100
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These micro-diamond results confirm that Renard 1 has strong similarities to the nearby Renard 65 kimberlite, with an almost identical diamond content and coarse diamond size frequency distribution. A location map, and a comparative stone count plot demonstrating the similarities in the micro-diamond signatures of the two kimberlites (taking full account of sample geology and dilution), can be found on the Stornoway website at http://tinyurl.com/4uwfabu.

Matt Manson, President and CEO commented: 'With Renard 1, we undertook to re-assess the economic potential of a large body that lay very close to our existing mineral resources and which we felt had been overlooked. The new microdiamond results have rewarded this approach. The developing Renard mine plan contemplates a combined open pit and underground operation established, initially, on the high grade Renard 2 and 3 kimberlites. However, Renard 65 has the potential to form a large, supplemental resource that is lower grade but easily open-pittable. Today's news now gives strong encouragement that Renard 1 has a similar potential. Ten years following its initial discovery, the Renard Project continues to demonstrate its considerable resource upside.'

On the basis of drilling completed to date, Stornoway estimates Renard 1 to contain 9.1 million tonnes of kimberlite to a depth of 282 meters. Renard 65 occurs 300m north of Renard 1 and is the largest kimberlite at the project. The current NI 43-101 compliant mineral resource for Renard 65 is 12.9 million tonnes of Inferred Resource to 290 meters depth at an average grade of 29 carats per hundred tonnes ('cpht'). An additional 29.5 to 41.6 million tonnes of non-resource, potential mineral deposit has been estimated at between 23 to 33 cpht. Both kimberlites are composed of several pipe-filling volcaniclastic to coherent kimberlite units and a distinct hypabyssal kimberlite unit. The reader is cautioned that mineral resources that are not mineral reserves do not have demonstrated economic viability. In addition, the potential quantity and grade of any potential mineral deposit is conceptual in nature, and it is uncertain if further exploration will result in the target being delineated as a mineral resource.

Next Steps

Stornoway is currently formulating a 2011 program of resource assessment at Renard that is expected to include the collection and processing of a large tonnage bulk sample from Renard 65. The purpose of this sample is to collect a large enough parcel of diamonds for valuation so as to allow the conversion of the existing Inferred Mineral Resource to an Indicated Mineral Resource. Should the results of this work confirm the potential viability of open pit mining at Renard 65, it is expected that additional drilling and sampling programs at Renard 1 will be initiated with a view to expanding the quantity of open-pittable resources of this type. In the meantime, petrographic, density and geochemical studies, as well as other work on Renard 1, remain outstanding. This data will be used to update the preliminary geological model and to better quantify a potential mineral deposit estimate for the body.

Scientific and Technical Data

Caustic dissolution data described above are based on work completed by Microlithics Laboratories, Thunder Bay, Ontario, an independent mineral process laboratory. As part of Stornoway's ongoing QA/QC programs all materials are subject to audit, and any significant changes will be reported when available.

Stornoway's diamond exploration programs are conducted under the direction of Robin Hopkins P.Geol. (NT/NU), Vice President, Exploration, a Qualified Person under NI 43-101. Mr. Hopkins has reviewed the contents of this press release.

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 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau in the James Bay region of North-Central Quebec. In May 2010, Stornoway filed a National Instrument 43-101 compliant technical report for the Preliminary Assessment at Renard that estimated the project to have the potential to produce approximately 30 million carats of diamonds over a 25 year mine life, with a pre-tax Net Present Value of C$885 million (at an 8% discount rate) and an Internal Rate of Return of 24.8%. Total capital investment was estimated at C$511 million. National Instrument 43-101 compliant Indicated and Inferred Mineral Resources currently stand at 23.8 and 17.5 million carats respectively, with a further 23.5 to 48.5 million carats classified as a non-resource, 'potential mineral deposit'. All kimberlites remain open at depth. Pending the completion of all ongoing mine feasibility and environmental and social impact assessments, and the receipt of all regulatory approvals, Stornoway currently anticipates being able to make a potential production decision at Renard by the end of 2011. Readers are referred to the technical report in respect of the Renard Diamond Project for further details and assumptions relating to the project.

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 or Toll Free: 1-877-331-2232
info@stornowaydiamonds.com
www.stornowaydiamonds.com


M. Ghislain Poirier

Vice-president Affaires publiques de Stornoway

418-780-3938
gpoirier@stornowaydiamonds.com


Sophie Alarie

Directrice Marketing et Relations publiques a la SGF

514-876-9368
salarie@sgfqc.com


Pierre Bertrand

Directeur general de SOQUEM

819-874-3773
pierre.bertrand@soquem.qc.ca