VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 25, 2011) - Peregrine Diamonds Ltd. (News - Market indicators) ("Peregrine" or "the Company") is pleased to report that a 32.54 tonne mini-bulk sample of surface material collected from the CH-28 kimberlite returned 8.94 carats of commercial-sized diamonds larger than the 0.85 mm sieve size, for a Diamond grade of 0.27 carats per tonne ("cpt"). 

The CH-28 kimberlite has an estimated surface expression of two hectares and is located on the 9,800 square kilometre Chidliak project ("Chidliak"), Baffin Island, Nunavut, Canada. CH-28 is approximately 50 kilometres north of the Southern Focus Area, an area at Chidliak with an eight kilometre radius that currently hosts six kimberlites with economic potential.

The mini-bulk sample from the CH-28 kimberlite was processed by dense media separation ("DMS") at the Saskatchewan Research Council Geoanalytical Laboratories ("the SRC"). The Diamond results are presented in square mesh sieve format in the following table. 

The four largest diamonds were described by the SRC as a 0.98 carat brown tetrahexahedroid, a 0.44 carat white/colourless distorted crystal, a 0.37 carat off-white cubic Diamond and a 0.37 carat white/colourless tetrahexahedroid. The remaining nine diamonds in the +2.36 mm sieve size range in weight from 0.15 to 0.35 carats, with one being white/colourless, another grey and the remaining seven off-white.

Images from CH-28 are available at the following link www.pdiam.com/i/pdf/Chidliak468.pdf.

SAMPLE COLLECTION, PROCESSING AND Diamond RECOVERY

The 32.54 tonne CH-28 sample was collected from in-situ surface material (subcrop) over an area measuring approximately 50 by 50 metres. The sample consisted of macrocrystic kimberlite with abundant indicator minerals. The sample collection and shipment process was conducted under strict chain of custody protocols and was supervised by senior Peregrine personnel. 

At the SRC, the sample was crushed by a jaw crusher with a gap set at approximately 30 mm. The sample was then fed into a five tonne per hour DMS plant where it was subjected to scrubbing and two stages of crushing. DMS concentration was performed on +0.85-12.0 mm feed material. Heavy mineral concentrate from the DMS was treated through a two-stage Flow Sort x-ray sorter and vibrating grease table recovery circuit. The resulting concentrates were then hand-sorted for final Diamond recovery using sealed glove boxes. 

As an element of Peregrine's Quality Assurance/Quality Control protocols, 179 numerically laser-etched natural Diamond tracers ranging in size from 0.15 to 2.84 carats were added to the sample bags in the field and at the SRC, and 177, or 99 percent, of the tracers were recovered from the DMS concentrate.

ABOUT CH-28

The discovery of the CH-28 kimberlite was first reported on September 23, 2010. A 238.9 kilogram surface sample yielded 174 diamonds larger than the 0.106 mm sieve size, including five diamonds larger than the 0.850 mm sieve size which weigh a total of 0.196 carats. As reported on June 2, 2011, a core hole was drilled across CH-28 and a 393.1 kilogram sample of drill core yielded 251 diamonds larger than the 0.106 mm sieve size including 0.13 carats of commercial-size (+0.85 mm) stones. 

The SRC is an independent laboratory that is accredited by the Standards Council of Canada to the ISO/IEC Guide 25 standard for Diamond recovery by caustic fusion.

Mr. Peter Holmes, P. Geo., Peregrine's Vice President, Exploration, is a Qualified Person under NI 43-101 and is responsible for the design and conduct of the programmes carried out by the Company at Chidliak. Mr. Howard Coopersmith, P. Geo., an independent consultant to the Diamond industry, was Peregrine's external Qualified Person for the sample processing and Diamond recovery. Mr. Holmes and Mr. Coopersmith have reviewed this release and approve of its contents. 

Chidliak is a joint venture between Peregrine (49%) and BHP Billiton (51%). Peregrine is the operator.

Forward-Looking Statements: This news release contains forward-looking statements. All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements relating to the proposed exploration programme, funding availability, anticipated exploration results, resource estimates, and future exploration and operating plans) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks and uncertainties that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements and, even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on, the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things, uncertainties relating to the availability and cost of funds, timing and content of work programmes, results of exploration activities, interpretation of drilling results and other geological data, world Diamond markets, future Diamond prices, reliability of mineral property titles, changes to regulations affecting the Company's activities, delays in obtaining or failure to obtain required project approvals, any changing budget priorities of BHP Billiton, operational and infrastructure risks, and other risks involved in the Diamond exploration business. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to their inherent uncertainty.