Stornoway Diamond Corporation Reports Updated Renard Preliminary Assessment Pre-Tax NPV Increases By 1,400% To $C885 Million by 24hgold

March 22, 2010

STORNOWAY REPORTS UPDATED RENARD PRELIMINARY ASSESSMENT PRE-TAX NPV INCREASES BY 1,400% TO $C885 MILLION

Stornoway Diamond Corporation (TSX-SWY) is pleased to announce the receipt of an updated Preliminary Assessment for the Renard Diamond Project in North Central Qu?bec. 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 SOQUEM INC. (?SOQUEM?). The study comprises a conceptual mine plan, capital and operating cost estimates, and cash flow model prepared by Scott Wilson Roscoe Postle Associates Inc. (?Scott Wilson RPA?), a diamond processing plant design, with capital and operating cost estimates, prepared by AMEC Americas Limited (?AMEC?), and social, environmental and permitting aspects contributed by Stantec Experts-conseil limit?e (?Stantec?). The conceptual mine plan is based upon a National Instrument (?NI?) 43-101 compliant mineral resource estimate prepared by Golder Associates Ltd. and reported previously by Stornoway on December 8th, 2009.

Highlights of the study, on a 100% project basis, are as follows:

Base case estimates of pre-tax Net Present Value (?NPV?) and Internal Rate of Return (?IRR?) at C$885 million (at an 8% discount rate) and 24.8% respectively using a September 2009 diamond valuation of US$117/carat and a US dollar exchange rate of C$1.11.

A conceptual mine life of 25 years based on a production rate of 1.8 million tonnes per year and a total diamond production of 30 million carats.

Pre-production capital cost of C$450 million, including contingencies, which increases to a total capital cost of C$511 million after sustaining capital and closure cost.

Average life of mine operating cost of C$39.45/tonne in a conceptual mine plan utilizing both open pit and underground mining.

Estimates of pre-tax NPV and IRR at C$1,173 million (at an 8% discount rate) and 29.7% respectively using current market assumptions for rough diamond pricing and the current US dollar exchange rate.

President and CEO Matt Manson stated, "The updated preliminary assessment at Renard shows a dramatic increase in NPV compared to a year ago due to the recent threefold expansion in the project?s resource base. The larger mine that this resource can now support has also allowed us to reduce our estimate of overall operating costs at the expense of a modestly higher capital cost. Considerable effort has been applied to defining these costs with a high degree of confidence. As a consequence, we see Renard as a project with the potential to deliver a robust mining margin over a very long mine life.?

Executive Chairman Eira Thomas stated, ?This study has firmly established Renard as one of the best undeveloped diamond deposits in the world, well on track to becoming Qu?bec?s first diamond mine. We now have a project with size, mining margin and significant upside potential in the resource. Our principal kimberlite body, Renard 2, is high grade and open at depth, and limited exploration drilling has been undertaken on the other kimberlites below 300 m. As we move the project towards full feasibility this year, we intend to continue exploring what is proving to be a major diamond deposit.?

Stornoway will host a conference call to answer questions on the updated Renard Preliminary Assessment on Monday, March 22, 2010 at 11am Eastern Standard Time. To participate in the call, dial 1-877-440-9795 within North America (local access 416-340-8530) or 800-9559-6849 internationally. A playback will be made available after the call by dialing 1-800-408-3053 (local access 416-695-5800) with the access code 1081742.

Updated Preliminary Assessment

In December 2008 Stornoway reported the results from an initial NI 43-101 compliant Preliminary Assessment of the Renard Diamond Project (?Technical Report on the Preliminary Assessment of the Renard Project?, dated December 12, 2008, revised March 25, 2009), prepared by Agnico-Eagle Mines Limited (?Agnico?) and AMEC, and reviewed by Scott Wilson RPA. Since this time, a highly successful drill program has resulted in a tripling of both the indicated and inferred resources at Renard, prompting an update to the earlier study. For this updated 2010 Preliminary Assessment, Scott Wilson RPA have redesigned the conceptual mine plan to best exploit the new, larger resource, and refreshed the capital and operating cost estimates. AMEC have also supplied updated cost estimates for a diamond processing plant design derived from the earlier study, but now expanded to a rated capacity of 5,000 tonnes per day.

Cost estimation in the updated Preliminary Assessment has largely been completed to a Pre-Feasibility standard: most capital and operating costs are drawn from direct supplier quotes, or unit costs established at comparable Qu?bec and Nunavut mining operations, including those of Agnico. However, the conceptual nature of the mine design and the inclusion of inferred resources in the economic assessment define the study as a ?Preliminary Assessment? under NI 43-101 Standards of Disclosure for Mineral Projects. Inferred mineral resources are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and therefore there is no certainty that the Preliminary Assessment will be realized.

Financial Model
A base case financial model has been prepared using a US dollar exchange rate of C$1.11, as recommended for planning purposes by Scott Wilson RPA, and NPV has been calculated at an 8% discount rate. A diamond price estimate of US$117/carat has been adopted following a diamond valuation and modeling exercise undertaken by WWW International Diamond Consultants Ltd. ("WWW") in September 2009, and has been applied equally to the Renard 2, 3, 4 and 9 kimberlite pipes. An annual diamond price escalation factor of 2.5% has been applied starting in 2011, consistent with a consensus of recent diamond industry price forecasts. On this basis, pre-tax NPV is C$885 million, with a pre-tax IRR of 24.8% (Table 1).

To read the complete news release, please click here .

For more information, please contact Matt Manson (President and CEO) at 416-304-1026
or Nick Thomas (Manager Investor Relations) at 604-983-7754 or toll free at 1-877-331-2232
Pour plus d? information, veillez contactez M. Ghislain Poirier (Directeur Environnement et Affaires Publiques) au 418-780-3938 ou gpoirier@stornowaydiamonds.com
** Website: www.stornowaydiamonds.com Email: info@stornowaydiamonds.com *

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, including plant costs, and operating costs; (v) diamond values and increases in diamond values; (vi) strip ratios, rates of extraction of kimberlite and mining rates; (vii) expected time frames for repayment of borrowed funds; (viii) anticipated dilution of mineralized material; (ix) anticipated breakage in processing; (ix) mine expansion potential; (x) exploration potential at the Project; (xii) road construction and operation costs; and (xi) expected time frames for completion of permitting and regulatory approvals, proceeding to 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) the presence of and continuity of diamonds in its host rocks at the Project at modeled grades; (ii) the capacities of various machinery and equipment; (iii) the availability of personnel, machinery and equipment at estimated prices; (iv) exchange rates; (v) diamond values and diamond price escalation factors; (vi) discount rates; (vii) tax rates and royalty rates applicable to the proposed mining operation; (viii) financing structure and costs; (ix) diamond recovery and breakage, (x) reasonable contingency requirements; (xi) anticipated financial performance, (xii) receipt of regulatory approvals on acceptable terms within commonly experienced time frames; (xiii) the settlement of an Impact and Benefits Agreement on acceptable terms within a reasonable time frame. 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.

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March 22, 2010

STORNOWAY REPORTS UPDATED RENARD PRELIMINARY ASSESSMENT PRE-TAX NPV INCREASES BY 1,400% TO $C885 MILLION

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