Kennady Diamonds Announces Kelvin Exploration Results

• DMS "Commercial Size" Sample Grade of 2.59 carats per tonne
• Caustic Fusion "Commercial Size" Sample Grade 2.57 carats per tonne
• First Kelvin 2015 drill hole intersects kimberlite

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TSX-V: KDI

TORONTO, Jan. 26, 2015 /CNW/ - Kennady Diamonds Inc. ("Kennady Diamonds," the "Company") (TSX-V: KDI) is pleased to announce further diamond recovery results from the Kelvin 2014 summer/fall mini-bulk sample program. The mini-bulk sample was recovered by drilling along the north lobe of the Kelvin kimberlite.

Approximately 18.88 tonnes of kimberlite was processed by dense media separation ("DMS") at the Geoanalytical Laboratories Diamond Services of the Saskatchewan Research Council ("SRC") and a further 5 tonnes was processed by caustic fusion, with 3.77 tonnes being processed at the SRC and 1.23 tonnes being processed at the Rio Tinto diamond laboratory in Thunder Bay, Ontario. Processing of the samples was completed under the supervision of Mr. Howard Coopersmith, P. Geo., the Company's independent external Qualified Person for sample processing and diamond recovery.

Commenting, Kennady Diamonds CEO Patrick Evans said: "We are very pleased with the latest diamond recovery results, which confirm that the Kelvin kimberlite has the potential to host a high-grade diamond resource. Based on drilling and sampling completed to date, we estimate that the Kelvin – Faraday kimberlite cluster has the potential to host between 9 and 12 million tonnes at a grade of between 2 and 2.5 carats per tonne."

Kennady Diamonds is also pleased to announce that drilling to extend the strike of the Kelvin kimberlite to the northwest has resumed. Kimberlite has been intersected in the first drill hole of the 2015 drill season. Further results will be announced as they become available.

Table 1 below summarizes the caustic fusion diamond recovery results from the 2014 summer/fall mini-bulk sample.

Table 1 – Kelvin Caustic Fusion Diamond Recovery Results

*Total sample weight 5.001 tonnes
*Total weight of recovered diamonds greater than 0.85mm: 12.85 carats
*Sample grade of diamonds greater than 0.85mm: 2.57 carats per tonne

Table 2 below summarizes the DMS diamond recovery results from the summer/fall mini-bulk sample, which were announced on December 24, 2014.

Table 2 – Kelvin DMS Diamond Recovery Results

*Total weight of recovered diamonds greater than 0.85 mm: 48.84 carats
*Sample grade: 2.59 carats per tonne

Mr. Evans noted: "It's encouraging that the sample grades from the caustic fusion and DMS are essentially the same. This increases our confidence that we are achieving good recoveries in the DMS. It's also encouraging that the high diamond sample grades were achieved without the 'nugget' effect that would have been produced by the recovery of larger diamonds."

The three largest diamonds recovered from the Kelvin caustic fusion sample are described as:

• 0.73 carat off-white, transparent, octahedral with minor inclusions;
• 0.61 carat white/colorless, transparent, octahedral with minor inclusions; and
• 0.48 carat white/colorless, transparent, octahedral with minor inclusions.

To date Kennady Diamonds has recovered a total of 53.15 tonnes of kimberlite from Kelvin by drilling. Processing of that kimberlite by DMS and caustic fusion methods has yielded 124.90 carats greater than 0.85mm. The largest diamond recovered from that sample weighed 2.48 carats.

Mr. Evans concluded: "2014 was a remarkably successful year for Kennady Diamonds. Our project has developed rapidly since the listing of Kennady in 2012. Results to date confirm that our 100 percent controlled Kennady North project is Canada's most exciting new diamond discovery. We are currently preparing to take a 500 to 700 tonne bulk sample from Kelvin starting next month, while we continue delineation drilling at the Kelvin and Faraday kimberlites. We also look forward to commencing our exploration drill program at the diamond-bearing MZ and Doyle kimberlites as well as a number of new exploration targets."

About Kennady Diamonds
Kennady Diamonds Inc. controls 100 percent of the Kennady North diamond project located immediately to the north, west and south of the Gahcho Kué diamond mine currently under development by De Beers and Mountain Province Diamonds.

Kennady Diamonds aims to identify a resource along the Kelvin – Faraday kimberlite corridor of between 9 and 12 million tonnes and also to identify new kimberlites outside of the corridor. The Kelvin – Faraday kimberlite corridor is a target for further exploration.  The tonnage estimate is based on the drilling completed to date. The potential quantity is conceptual in nature as there has been insufficient drilling to define a mineral resource and it is uncertain whether further exploration will result in the target being delineated as a mineral resource.

Qualified Persons
This news release has been prepared under the supervision of Carl G. Verley, P. Geo., who serves as the Qualified Person under National Instrument 43-101. Mr. Howard Coopersmith, P. Geo., an independent consultant to the diamond industry, is Kennady's independent, external Qualified Person for sample processing and diamond recovery.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) has reviewed or accepts responsibility for the adequacy or accuracy of this release.

FORWARD LOOKING INFORMATION
This news release includes certain information that may constitute "forward-looking information" under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, the Company's strategic plans, future operations, future work programs and objectives. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of management and information available to management as at the date hereof. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

SOURCE Kennady Diamonds Inc.