Dec 17, 2007
Peregrine Announces Modelled Values of US$43 to US$70 Per Carat for DO-27 Bulk Sample Diamonds

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Vancouver, British Columbia, Canada - Monday, December 17, 2007 - Brooke Clements, President of Peregrine Diamonds Ltd. ("Peregrine") (TSX: PGD) is pleased to report modelled diamond values for 2,075 carats of diamonds recovered from the nine hectare DO-27 kimberlite pipe, WO Diamond Project, NT, Canada. The average modelled value ranged from US$43 to US$70 per carat, with a "Base Case" average of US$51 per carat. The valuation was completed in Antwerp, Belgium under the supervision of WWW International Diamond Consultants Ltd. ("WWW"), an internationally recognized diamond valuation and consultancy company. These valuation results, along with updated grade and geological information, will be used by Peregrine and AMEC Americas Ltd. ("AMEC") to complete the Preliminary Technical Assessment ("PTA") report, which will investigate the current economic potential of DO-27.

DIAMOND VALUATION RESULTS

The cumulative 2,075 carat diamond parcel was acquired by large diameter, reverse circulation bulk sample drilling campaigns completed by Peregrine in 2005, 2006 and 2007. All of the diamonds valued are from the Main Lobe and Northeast Lobe pyroclastic kimberlite ("PK") units. An additional 188 carats that were recovered from other minor, volumetrically insignificant, Northeast Lobe lithologies in 2006 and 2007 were not included in the valuation model as these lithologies may not be included in the final resource model. Detailed information on the three bulk sampling campaigns can be found in Peregrine press releases dated June 14, 2005, September 5, 2006 and September 18, 2007.

The valuation results are summarized in the table below.

DO-27 DIAMOND VALUATION RESULTS

⁽¹⁾ Sample weights represent the total carat weight of diamonds presented for valuation following the combination of individual sub-samples and after acid cleaning.
⁽²⁾ As determined by WWW International Diamond Consultants Ltd.
⁽³⁾ Values from the WWW October, 2006 price book, as reported by Peregrine on November 6, 2006.
⁽⁴⁾ The combined sample was re-priced and modelled based on the WWW October 31, 2007 price book.

The modelled price estimates for DO-27 represent an average diamond price in the rough diamond market in November, 2007 that might reasonably be expected, based on standard production-scale recoveries of commercial sized diamonds greater than 1.00 mm in size.

The most valuable diamonds in the 2007 parcel were a 4.35 carat fancy yellow octahedron and a 4.19 carat white stepped octahedron, both valued at US$1,900 per carat (see photograph at: http://www.pdiam.com/i/photos/2x4caraters.jpg).

In addition to determining a modelled average price, WWW showed a 1,123 carat parcel from the Main Lobe PK lithology from the 2007 bulk sample to four other internationally recognized, Antwerp-based rough diamond valuators in order to obtain additional market-based, unmodelled valuations. This parcel was selected for spot price valuation as it was the single largest representative parcel of Main Lobe PK diamonds. Average October, 2007 spot prices for the 1,123 carat parcel of US$46, US$48, US$52 and US$56 per carat respectively were determined by the four groups whereas the average spot price determined by WWW was US$46 per carat.

WWW believes it is highly unlikely that the modelled average price will be lower than the minimum values and that the high values should not be considered maximum values. The modelled average price is extremely sensitive to the value of large diamonds so there is a high degree of uncertainty in the modelled value of the larger stones that would be expected in a production scenario. This is an important fact given that the 2,075 carat parcel submitted for modelling contained only 22 stones greater than two carats and five stones greater than five carats.

Diamond price models principally attempt to correct for an absence of large diamonds which are typically under-represented at this scale of bulk sampling. WWW commented that the bulk samples are still considered small for fully modelling the average dollar value per carat. Usually, the average diamond price from a bulk sample is lower than the average diamond price for the resource in a mining scenario. WWW has indicated that for typical kimberlite diamond mines, 7,000 carats would usually give an unmodelled average price within 10 percent of the true value of a production scenario and a 3,000 carat parcel an unmodelled true value within 15 percent. After modelling of the price for a 3,000 carat parcel, confidence limits would be expected to tighten to within 10 percent.

FUTURE WORK

Information from the 2005, 2006 and 2007 bulk sampling, core drilling and diamond valuation programs is being used by AMEC to construct geological and resource models for DO-27. The results of that work will allow the completion of the PTA by AMEC. The PTA will investigate possible mining and processing scenarios for DO-27 based on the geological and resource models. As reported on July 24, 2007, the PTA will include a study of alternative front-end processing techniques to take advantage of the soft, low work index, characteristics of DO-27 kimberlite. The final completion of the PTA, and associated resource models, is expected in the second quarter of 2008. As part of the resource model portion of the PTA, average grade and average per carat diamond values for DO-27 may be adjusted to optimize recovery cut-off sizes to better reflect potential mining and processing scenarios.

Though Peregrine and WWW recognize that a larger diamond parcel from DO-27 would result in higher confidence levels in the average diamond value, Peregrine believes that all the data currently in hand are sufficient to allow a reasonable assessment of the economic potential of DO-27 in the PTA. Therefore, no additional bulk sampling campaigns are currently planned at DO-27 for the winter 2008 field season.

Jennifer Pell, Ph.D., P.Geo., Chief Geoscientist for Peregrine Diamonds Ltd., is the Qualified Person under NI 43-101, for work on the DO-27 kimberlite. Ms. Pell monitored the valuation process in Antwerp for Peregrine. Howard Coopersmith, an internationally recognized consultant to the diamond industry, was Peregrine's external Qualified Person for the 2005, 2006 and 2007 bulk sampling programs. Quality control and assurance protocols and procedures for the processing, transport, recovery, valuation and security of the diamonds conform to industry standard Chain of Custody provisions and were reviewed and verified by both Peregrine's internal and external Qualified Person.

Peregrine is a Canadian diamond exploration/development company that is managed by experienced geoscientists. In addition to work on the DO-27 kimberlite, Peregrine is also exploring for other diamondiferous kimberlites on its extensive land holdings in Canada. As reported on November 22, 2007, Peregrine has discovered a new diamondiferous kimberlite field on the Nanuq property in the eastern Arctic region of Nunavut. Peregrine trades on the Toronto Stock Exchange under the symbol "PGD".

For further information, please contact Jim Crawford, Manager - Investor Relations at 604-408-8880 or at jim@pdiam.com.

Forward-Looking Statements: This document includes forward-looking statements. Forward-looking statements include, but are not limited to statements concerning Peregrine's projects and other statements that are not historical facts. When used in this document, the words such as "could," "confident," "plan," "estimate," "expect," "anticipated," "intend," "likely," "may," "potential," "should," "scheduled," "significant," and similar expressions are forward-looking statements. Although Peregrine Diamonds Ltd. believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Important factors that could cause actual results to differ from these forward-looking statements are disclosed in the corporation's periodic filings with Canadian regulators.