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A New Force in the Canadian Diamond Industry

A New Force in the Canadian Diamond Industry. RBC Diamond Conference London, May 15, 2008. Forward Looking Information.

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A New Force in the Canadian Diamond Industry

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  1. A New Force in the Canadian Diamond Industry RBC Diamond Conference London, May 15, 2008

  2. Forward Looking Information This presentation may contain forward looking statements, being statements which are not historical facts, and discussions of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based upon a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. Important factors that could cause actual results to differ materially from the Stornoway's expectations are in Stornoway documents filed from time to time with the Toronto Stock Exchange and provincial securities regulators, most of which are available at www.sedar.com. Stornoway disclaims any intention or obligation to revise or update such statements. 2

  3. Our Vision To create a successful growth oriented diamond company that succeeds in the practical business of mining and selling rough diamonds, and which pursues an aggressive exploration strategy to seek and develop world-class diamond mining opportunities in a market that has become increasingly under-supplied.

  4. Quality Diamond Assets in Canada • Ownership in Renard, one of Canada’s largest undeveloped diamond resources with potential for near term cash flow and leveraged against strong, predicted price growth • Four advanced diamond projects capable of adding reserves • One of Canada’s leading, diversified exploration portfolios with “blue-sky” potential

  5. Stornoway as an Investment Opportunity Lowest Risk Canadian Portfolio With Large Exploration Upside For Investors

  6. Capital Market Profile 6 *as of April 30th, 2008 $1.74 billion $1.93 billion Market Cap (millions)

  7. Financial Platform As of April 30, 2008

  8. Why Canada? 8

  9. Canada’s Place in Global Diamond Exploration World Diamond Exploration Expenditures 2006 Russia Canada Sierra Leone Expenditures in Millions (Cdn) Democratic Republic of Congo Angola Australia Botswana Namibia South Africa Expenditure Information from Metals Economics Group, CorporateExploration Strategies 2006 and Courtesy of the Ontario Ministry of Northern Development and Mines

  10. DecliningRiskProfile Canadian Project Pipeline Development-Track • Renard, Quebec Advanced Exploration • Aviat, Nunavut • Churchill, Nunavut • Qilalugaq, Nunavut • Timiskaming, Quebec & Ontario Early-Stage Exploration • Over 12 million acres of prospective ground in Canada over 150 kimberlites discovered to date.

  11. Stornoway’s Principal Properties (encompassing 155 kimberlites) Legend Development Track ProjectAdvanced Stage ProjectsGrass Roots ProjectsAreas of Exploration Focus 11 11 Mackenzie Wales Island (10) Aviat (11) Coronation Gulf (10) Qilalugaq (16) Slave Craton (6) Churchill (79) Blackstone N. Alberta Renard (14) Pikoo Calling Lake Timiskaming (9)

  12. The Renard Kimberlites, Otish Mountains, Québec Development Track Projects

  13. The Foxtrot Project and Renard Kimberlites- Renard” 1-10 kimberlite pipes and “Lynx-Hibou” kimberlite dyke system within “Foxtrot” property 50/50 Joint Venture between Ashton (a subsidiary of Stornoway) and SOQUEM Discovered 2001-2003 Québec is routinely assessed as one of the top mining jurisdictions in the world Agnico-Eagle Mines Ltd. is Stornoway’s largest shareholder and a leading mine developer in Québec . Legend Development Track ProjectAdvanced Stage ProjectsGrass Roots ProjectsAreas of Exploration Focus Mackenzie Wales Island Aviat Coronation Gulf Qilalugaq Slave Craton Churchill Blackstone N. Alberta Renard Pikoo Calling Lake Montreal Winnipeg Timiskaming Calgary Toronto

  14. North Dyke Discovery N Laforge 2 Ice Direction Laforge 1 Brisay LG4 North Anomaly LG2 LG3 Foxtrot Property Eleonore Renard Wemindji Western Troy Eastmain Mine R7 Strateco R10 R1 R7 Hibou Troilus Mine R1 Temiscamie Mistissini Renard Core Area Matagami Chibougamau Legend Lynx Stornoway/Soquem JV Properties HydroQuebec Facility Renard Kimberlites Kimberlitic Dyke Kimberlitic Pebbles & Boulders Diamond in Till Anomaly Outline HydroQuebec Powerlines Winter Road Road South Anomaly SE Dyke Discovery Southeast Anomaly 2 km Renard Kimberlite Bodies

  15. The Renard Kimberlites are Complicated and have Variable Grades(Renard 2 Geological Model, February 2008) Halo HK CRB Brown (kimb2b) Blue (kimb2a) West View Oblique View (no Halo) Plan View

  16. The Renard Kimberlites are Complicated and have Variable Grades(Renard 3 Geological Model, February 2008) CRB+HK Brown (kimb3f) Halo ? Blue (kimb3b) Green (kimb3i) Grey (kimb3g) Plan View Looking North (No Halo) Looking North

  17. Renard Bulk Sample Program (2006-2007) Extraction and processing of 10,000 tonne bulk sample from Renard kimberlites 2, 3 and 4. Combination of underground decline and surface trenching On-site treatment by DMS of 6,000 tonnes. Valuation of 6,500 carat sample October 2007, revised March 2008. Underground Sample Renard 2 & 3 Surface Sample Renard 4 Underground Sampling

  18. 2007 Bulk Sample Results 18 1The estimated diamond content, expressed as carats per hundred tonnes, may not be representative of the overall diamond content of the body due to a number of factors, including location and size of the samples

  19. Pre-Feasibility Study 19 • Agnico-Eagle will author the main pre-feasibility report with support and contributions from AMEC Americas Ltd. • Four Study Modules • Module 1: Resource (AMEC) • Module 2: Mine (AEM) • Module 3: Plant (AMEC) • Module 4: Cap-ex, Op-ex and Financial Model (AEM) 10.15 carat June 2007 : • Pre-feasibility Phase 1 Commences November 2007: • Pre-feasibility Phase 2 Commences. • First results beginning Q2 2008.

  20. A Renard Diamond Resource The Renard Kimberlites are Small Grades are Variable, but Good by World Standards The Renard Diamonds are High Quality with: Good crystal shapes Colours of White to Brown No “Boart” or Industrial Grade diamonds A potential for large “Special” diamonds Renard 3 Bulk Sample Diamonds Renard 3 Mini-Bulk 4.3ct Lynx Mini-Bulk 5.7ct Renard 3 Bulk Sample Diamonds 4.89ct 6.36ct 10.15ct 4.26ct 4.94ct 20

  21. Renard Diamonds: Value Upside with Large Gems 21 By weight... By value… At Renard, Quality Improves with Size! SWY Internal Analysis of 6,500 carat sample

  22. Conceptual Site Layout(Working Draft) Winter road Hibou Overburden Storage Open Pit R2 & R3 Open Pit R4 & R9 Processed Kimberlite and Strip Rock Lynx Plant and Accommodation Water Treatment 1 000 m Permanent Road

  23. Conceptual Mine Plan: Combined Open Pit and Underground Mining(Working Draft) 23 Elev 500 Portal 130 m Level 540 Drilling Level 100 m Level 525 (Drilling Level) Level 530 Mucking Level Level 515 (Mucking Level) Renard 3 Level 504 (Drilling Level) Elev 0 Level 494 (Mucking Level) Renard 4 Renard 9 Renard 2

  24. Plant and Production Rate Investigating 3,500 and 5,000 tonnes per day options 1.3m to 1.8m tonnes/year or 1m to 1.5m carats/year Recovery of large diamonds a priority for flow sheet design Proven technology on diamond recovery Investigating onsite Genset against powerline and cheap hydro: Cap-ex/Op-Ex trade off 24

  25. Renard Development: An Optimistic Schedule 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012 2012 2013 2013 1999 Grassroots Exploration Discovery Staged Mini-Bulk Sampling Bulk Sampling Pre-Feas Feas./ Permitting The Timing and Nature of Infrastructure Development is Key ? Construction ? Prod. 1999

  26. Road and power access are critical determinants for the economic viability of the Renard Project. Stornoway has conducted scoping-level studies for a 4-season forestry grade road from both the north (154km) and the south (238km). Stornoway lends full support to a Provincial and Federal Government, Community and Industry partnership created to facilitate a permanent “Route Monts Otish”. Infrastructure: Access Routes and Powerlines 26 Stornoway/Soquem JV Properties HydroQuebec Facility Kimberlitic Pebbles & Boulders HydroQuebec Powerlines Road Laforge 2 Laforge 1 Brisay Potential Powerlines LG4 LG2 LG3 Eleonore Renard Wemindji Eastmain Western Troy Strateco Potential Road Troilus Mine Temiscamie Mistissini Matagami Chibougamau

  27. Canadian Diamond Project Resources and Cap-Ex Mines Development Projects Development-Track Projects Source: 2005 Mine Estimates and 2006 Project Forecasts

  28. Renard: Opportunities and Challenges The Opportunities Renard has the potential to become Quebec’s first diamond mine. A producer of large, high value gems 200-300 jobs during construction, 150-200 jobs during operation Potentially 1m to 1.5m carats/year for more than 10 years Local purchasing, employment, and capacity development The Challenges The Project is modest in scope and requires careful, cost-conscious management. Government and community support for infrastructure development is key.

  29. Exploration Advanced Stage Projects

  30. Stornoway’s Property Portfolio (as at July 02, 2007) • 12.88 million acres total (in 34 active projects) • 0.40 million acres ‘development’ stage (Renard) • 5.04 million in ‘advanced’ stage projects (Aviat, Churchill, Qilalugaq and Timiskaming) • 7.44 million acres in ‘early stage’ projects (Pikoo, Botswana, Blackstone, Itza, etc.)

  31. Legend Development Track ProjectAdvanced Stage ProjectsGrass Roots ProjectsAreas of Exploration Focus Stornoway’s Advanced Stage Exploration Properties (encompassing 155 kimberlites) 31 31 Aviat (11) Qilalugaq (16) Churchill (79) Timiskaming (9)

  32. Aviat (90%)Budget for 2008 is $3.1 million Legend Development Track ProjectAdvanced Stage ProjectsGrass Roots ProjectsAreas of Exploration Focus 32 32 Aviat (11)

  33. Aviat – Ongoing Exploration 11 kimberlites to date (8 dyke-like) good grades from those tested to date (average 75-100 cpht in early stage sampling; 162 cpht from 20.6 tonne sample of AV267) diamonds derived from similar source best 2007 intersection: 7.0 m (dykes), 87.0 m (AV9 pipe) AV9 came back significantly diamondiferous; 2008 focus Press Releases of January 21st and 29th 2008 162 cpht and 3.64 Carat Diamond Recovered from AV267 Kimberlite 33

  34. Schematic Cross Section Aviat 2007 Exploration Summary 20.6 t 162 cpht 48.9 t 89 cpht 6.2 t 80 cpht 2.1 t

  35. S N 20.6 t 162 cpht 6.2 t 80 cpht AV2 Upper ? AV267 ? AV9 ? ? ? ? ? 150 m Aviat’s Eastern Sheet Complex: area of focus • preliminary resource model currently being formulated for AV267 body; larger sample planned for 2008 • AV9 body, discovered late in 2007, will be focus of spring drilling program commencing in April, 2008 • dimensions not currently known of AV9; larger sample required to understand diamond carrying capacity.

  36. Advanced Exploration Projects2007 Budget ~ $7.0 million 36 Evaluation Work Completed to Date

  37. Exploration Grass Roots Projects

  38. Grass Roots Exploration Budget 2007 = $3.0 million 8 drill ready projects Mackenzie Slave Craton Itza Blackstone Foxtrot N. Alberta Calling Lake Timiskaming Legend Areas of Grass Roots Exploration Focus

  39. Conclusion Stornoway Offers: • A new and unique diamond investment opportunity at the right time • Strong, experienced management • One of Canada’s leading technical teams with a track record of discovery • Diversified project pipeline including grass roots and development track assets • Future cash flow potential • A company well positioned for growth

  40. A New Force in the Canadian Diamond Industrywww.stornowaydiamonds.com

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