• Processing of Kelvin bulk sample completed


• Diamond sorting and breakage study underway


• 148 meters of kimberlite intercepted at Kelvin North


• 8.4 meters of kimberlite intercepted at MZ

Kennady Diamonds Inc. (“Kennady Diamonds”, the “Company”) (TSX-V: KDI) is pleased to announce that processing of the Kelvin 436 tonne bulk sample was completed recently. The bulk sample was processed at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council (“SRC”), which is accredited to the ISO/IEC 17025 standard by the Standards Council of Canada as a testing laboratory for diamond analysis. Diamond sorting and a diamond breakage study are underway at the SRC and are expected to be completed by the end of August 2015.

Kennady Diamonds CEO Patrick Evans commented: “The primary purpose of the 2015 Kelvin bulk sample program is to recover a sufficiently large diamond parcel to allow a preliminary diamond valuation. The bulk sample was recovered by drilling on ice at the southeast lobe of Kelvin, areas where the kimberlite outcrops at surface and also where the country rock cover is relatively thin. Although the internal country rock dilution appears to be higher in this area, targeting the southeast lobe reduced the drilling costs compared with the deeper north lobe of Kelvin which appears to be less diluted.”

During the winter of 2014, Kennady Diamonds recovered a 25 tonne mini-bulk sample from the southeast lobe of Kelvin that returned a sample grade of 1.79 carats per tonne. This is the same area where the Kelvin 436 tonne bulk sample was recovered. A subsequent 19 tonne mini-bulk sample from the less diluted north lobe of Kelvin returned a sample grade of 2.59 carats per tonne.

Kennady Diamonds has retained the services of WWW International Diamond Consultants to provide an independent valuation of the Kelvin bulk sample diamonds and also to develop size frequency distribution and revenue models. This work will commence in Antwerp, Belgium, in early September and is expected to be completed by October.

Kennady Diamonds is also pleased announce further drill results from the 100 percent-controlled Kennady North diamond project. The focus of drilling at the Kelvin kimberlite remains infill and geotechnical drilling. In addition, the Company has commenced exploration drilling at the MZ kimberlite, which is located approximately 25 kilometers to the west of the Kelvin camp.

Mr. Evans noted: “The infill drilling at Kelvin is designed to support the preparation of the maiden resource statement expected before the end of the year, and the geotechnical and hydrological drilling is providing data to support the future Kelvin mine design.”

Mr. Evans added: “To take advantage of the excellent weather conditions, we have moved one drill rig to the west of the Kelvin–Faraday corridor to conduct exploration drilling. One new exploration target located between the Kelvin–Faraday corridor and MZ was tested, but no kimberlite was intersected. Drilling at the diamond-bearing MZ kimberlite is now underway and kimberlite has been intersected in the first two holes, which are detailed below.”

Table 1 below provides details of the latest drill results from the Kelvin 2015 summer drill program.

Drilling of Kelvin North infill hole 048b was stopped in kimberlite at 317 meters due to challenging ground conditions. With the mobilization of a larger fourth drill rig to Kennady North, consideration will be given to re-drilling this hole.

Table 2 below details the drill results from the MZ 2015 summer drill program.

The new drill targets at MZ are based on the results of recently completed ground geophysics. Previous drilling at MZ identified a series of diamondiferous kimberlite sheet structures. The current drill program is designed to provide additional data on the size and structure of the MZ kimberlite and also to provide a diamond parcel for grade analysis. It is encouraging that within the 8.4 meters of kimberlite recovered from drill hole 053a 3.5 meters of undiluted kimberlite was intersected between downhole depths of 76.5 meters and 80 meters. On the completion of the exploration drilling at MZ, the third drill rig will return to resume delineation drilling at the Faraday kimberlites.