1
Building a Canadian Diamond Resource Base
June 2010 Update
Nick Thomas, Manager Investor Relations
2
Forward Looking Information
This presentation may contain forward looking statements, being
statements which are not historical facts, and discussions of future
plans and objectives. There can be no assurance that such statements
will prove accurate. Such statements are necessarily based upon a
number of estimates and assumptions that are subject to numerous
risks and uncertainties that could cause actual results and future events
to differ materially from those anticipated or projected. Important
factors that could cause actual results to differ materially from the
Stornoway's expectations are in Stornoway documents filed
from time to time with the Toronto Stock Exchange and
provincial securities regulators, most of which are
available at www.sedar.com.
Stornoway disclaims any
intention or obligation to
revise or update such
statements, except as
required by law.
3
Why Diamonds? Why Renard?
Years of Reserves Left at Current Production Rate
100
90 Jwaneng and
Argyle Start
80
World diamond Orapa Jwaneng and
70 Argyle Full
reserves are 60
Production
being depleted 50
and are not 40
being replaced Ekati
30 Diavik
Snap Lake
20 15 years left of reserves at current production rate and Victor
10
0
1970 1975 1980 1985 1990 1995 2000 2005
Source: BMO Capital Markets (after Rio Tinto and BHP Billiton) Reports- Data after 2005 SWY Estimates
4
Why Diamonds? Why Renard?
Rough Diamond Price Index
Sept 2009: Renard
diamond valuation
Rough diamond
prices have
been growing
steadily
Sources: BMO Rough Diamond Price Index, Market Reports
5
An Inventory of Diamond Projects for a Future in Diamonds
Ownership
43-101 Resource of 36.3 million carats, advancing to
50% Renard become Québec’s first diamond mine
90% Aviat 24.1-40.3 million carats (conceptual)
50% Qilalugaq Large 11ha pipe at 30 cpht
15-20 million tonnes at 10-15 cpht Aviat
100% Timiskaming (conceptual) Qilalugaq
Churchill
47% Churchill 90+ kimberlite bodies, 3 minibulk sampled
Renard
200+ kimberlite pipes discovered in Canada; Timiskaming
100% Exp. >20 active projects
Development Track: 43-101 Resource
Advanced: delineation drilling and
minibulk sampling completed
A conceptual study does not comprise a NI 43-101 compliant mineral resource estimate, and no
mineral resource has yet been established at Aviat. The total diamond content estimate is based on Diamondiferous Kimberlites being
limited micro and macro diamond data as per October 2008 and assuming 100% recovery of stones in
all size fractions down to a +1.00 mm bottom cut-off. The contained carats estimate uses the
evaluated
conceptual range of total content of kimberlite material, conceptual estimate of total diamond content
and an allowance for approximately 5% internal dilution within the conceptual model. Exploration stage
6
Renard: Québec’s First Diamond Mine
Why Stornoway?
Renard: One of the Best Undeveloped Diamond
Projects in the World
7
Renard: Québec’s First Diamond Mine
Renard is a Project with.. Mackenzie
Wales Island
Aviat
Size: US$4B Resource
Coronation Gulf Qilalugaq
Upside: US$1-2B “PMD” Slave Craton
Churchill
Blackstone
Exploration Blue Sky
Good Mining Margin Renard
Calling Lake
Modest Cap-ex and Op-ex
Timiskaming Montreal
Calgary Winnipeg
Québec: World’s Best Mining Toronto
Jurisdiction1
A Road Under Development
A Good Partner: 50% JV with
1
2009 Fraser Institute Survey
8
Renard Kimberlite Bodies
N
Laforge 2
Laforge 1
Brisay
LG4
R10 LG2 LG3
R7 Foxtrot Property
Eleonore
Hibou R1 Wemindji Renard
Western Troy Eastmain Mine
R65 Strateco
R4 R8
Troilus Mine
Temiscamie
R9 R3
R2 Mistissini
Matagami
Lynx Chibougamau
Legend
Stornoway/Soquem JV Properties HydroQuébec
Kimberlite Bodies Under HydroQuébec Facility Powerlines
Assessment for Mining Renard Kimberlites Winter Road
Kimberlitic Dyke Road
Regional Kimberlites Exploration/
Mining Projects
2 km
9
Kimberlite Pipe Geology
Renard 2 Revised Geological Model, December 8th, 2009
Dec 2008
0m
3.4mt Ind. at 81cpht
1.8mt Inf. at 86cpht
(to 560m)
Predominantly
Kimb2a (Blue)
Predominantly
Kimb2b (Brown)
Cracked Country Rock
Country Rock Breccia
560m
700m
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Kimberlite Pipe Geology
Renard 2 Revised Geological Model, December 8th, 2009
Dec 2008
0m
3.4mt Ind. at 81cpht
1.8mt Inf. at 86cpht
(to 560m)
Predominantly
Kimb2a (Blue)
Predominantly
Kimb2b (Brown)
2009 Drilling discovered
Renard 2 to be four times Cracked Country Rock
bigger than previously Country Rock Breccia
thought to 700m depth.
Dec 2009 560m
17.5mt Ind. at 103cpht
5.4mt Inf. at 120cpht
(to 700m)
700m
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Kimberlite Pipe Geology
Renard 2 Revised Geological Model, December 8th, 2009
Dec 2008
0m
3.4mt Ind. at 81cpht
1.8mt Inf. at 86cpht
(to 560m)
Predominantly
Kimb2a (Blue)
Predominantly
Kimb2b (Brown)
2009 Drilling discovered
Renard 2 to be four times Cracked Country Rock
bigger than previously Country Rock Breccia
thought to 700m depth.
Dec 2009 560m
17.5mt Ind. at 103cpht
5.4mt Inf. at 120cpht
(to 700m)
700m
12
Kimberlite Pipe Geology
Renard 2, 3, 4, 9 & 65 Revised Geological Models, December 8th, 2009
Renard 65
Renard 4
Renard 9
Five Kimberlite
Pipes Within a 1km Renard 3
Radius
Similar Geology
Untested
Single Diamond Exploration
Population Potential
Variable Grades
Renard 2
Open at Depth
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Renard Resources and Resource Upside
Revised Mineral Resource Statement , December 8th, 2009
Average
Average Contained Average Contained
Tonnes Diamond
Grade Carats Rock Value Value
(millions) Price
(cpht) (millions) (US$/tonne) (million US$)
(US$/carat)
Total 87 26.5 23.0
23.0 $117 $101 $2,680
Indicated (+44%) (+128%) (+228%)
(+228%) (+8%) (+56%) (+256%)
Total 75 17.8 13.3
13.3 $108 $80 $1,430
Inferred (+19%) (+149%) (+196%) (+17%) (+38%) (+254%)
(+196%)
Notes Increases/Decreases from Mineral Resource Statement Published December 12th 2008 are shown in italics.
Resource categories are compliant with the "CIM Definition Standards on Mineral Resources and Reserves". Mineral resources that are not mineral reserves do
not have demonstrated economic viability. Changes from NI 43-101 Mineral Resource Estimate Published in December 2008 are shown in italics. Totals may not
add due to rounding. Diamond Prices are base case "model“ prices as determined by WWW International Diamond Consultants Ltd. following a re-valuation in
September 2009. Grades and diamond prices are estimated at a +1DTC sieve size cut-off.
Contained
Grade Tonnes
Carats 10.15 carat gem
(cpht) (millions)
(millions) quality
octahedron
Potential 38 26.8 12.2
12.2
Mineral to to to
to
Deposit 168 45.7 26.5
26.5
Notes The potential quantity and grade of any potential mineral deposit is conceptual in
nature, and it is uncertain if further exploration will result in the target being delineated as a
mineral resource.
The potential mineral deposit for the Renard kimberlite pipes has been determined by
projecting reasonable kimberlite volumes from the base of the inferred resource to a depth
of 700m below surface. In the case of the Lynx and Hibou dykes, the potential mineral
deposit was established on the basis of known drill intersections of kimberlite for which
insufficient diamond sampling exists to adequately estimate a diamond resource grade.
14
Exploration Upside
Winter Drill Program, Results Released April 13th 2010
Renard 4 Renard 65 Renard 3
3 of 3
Kimberlites
Tested Prove
Larger at Depth
than Previously
Estimated
15
Renard Conceptual Mine Planning
Mineral Resource Categories and a Combined Open Pit/Underground Mine Plan
Lower Value Ore Higher Value Ore
Renard 4 & 9 Renard 2 & 3
US$48-54 per tonne US$121-143 per tonne
Potential
Open Pit
Mining
Potential
Underground
Mining
Blended LOM
Operating Cost of
All Pipes Open at Depth C$39.45/tonne
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Renard Conceptual Mine Planning
Updated Preliminary Assessment, March 22nd, 2010
Renard 4 Pit
Renard 2&3 Pits
Renard 9
Renard 3 Ramp
100m Development Levels
Renard 2
Shaft to 800m
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Renard Conceptual Mine Planning
Updated Preliminary Assessment, March 22nd, 2010
Conceptual Mine Plan Base Case Financial Model (100%)
25 year mine life at 5,000tpd C$885m pre-tax NPV ($C538m after tax)
30mcarats LOM Production: maximum 24.8% pre-tax IRR (20.5% after tax)
production at Year 6 of 1.6 mcarats/a.
C$3.4 Billion Operating Cash Flow
Open Pit Mining Renard 2,3&4.
LOM 70% Operating Margin
Assisted Block Caving Renard 2&4
5 Year Pay-Back
Blast-Stope Mining Renard 3&9
Assumptions
Capital Cost
8% Discount Rate
Total: C$511m (with sustaining capital
and contingencies) 30% Effective Tax Rate
Preproduction: $C450m (inc. shaft) Diamond Price of US$117/ct (Sept. 09)
Operating Cost Price escalation of 2.5% starting in 2011
C$39.45/tonne blended LOM average. US$ Exchange Rate of C$1.11
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Renard Conceptual Mine Planning
Pre-Tax NPV Sensitivities (in C$m)
Operating Parameters
Financial Model Assumptions
10% 8% 5%
Discount Rate $642 $885 $1,440
0% +2.5% +5%
Diamond Price Escalation $370 $885 $1,633
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Renard Conceptual Mine Planning
Diamond Price Assumpoions
Diamond Price and Price Escalation Sensitivities
US$ Exchange
Diamond Price Diamond Price 8% Pre-Tax NPV
Rate
(US$/ct) Escalation (Cdn$)
(Cdn$)
Base Case
Assumptions
$1.11 $1171 2.5%2 $895m
Project Fixed at
Current Market
$1.00 $1463 0.0% $726m
Notes
1 WWW September 2009 Price Book Valuation, +1 DTC cutoff, sensitivities of $US103 to US$131
2 Applied after 2011
3 Based on reported 25% increase in WWW Rough Diamond Price Index between September 2009 and March 2010
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Renard Conceptual Mine Planning
Cost Estimates
Operating Cost Breakdown
Blended LOM Op-Ex of C$39.45/tonne
C$12.20/t mining (C$13.46/t ug, C$4.54/t op)
C$12.45/t processing
C$13.43/t surface services and G&A
Costs are estimated from either contractor quotes or real-case unit costs derived from
operating mines such as AEM’s Goldex (C$23/tonne) and Meadowbank (C$65/tonne)
Capital Cost Breakdown
Site Infrastructure and Facilities $89.2
Underground Mine and Shaft $110.5
Open Pit Mine $13.0
Plant $101.0
General Fees $70.2
Sustaining Capital and Closure $60.9
Contingency $65.8
Total $510.6
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Renard Diamonds
Single diamond population in Renard
kimberlites 2, 3, 4 & 9: US$117/ct
(6,900 carat bulk sample, September 2009 Valuation,
+1 DTC cutoff, sensitivities of $US103 to US$131)
Colours and qualities improve with
size. Zero boart.
Coarse size distribution: potential for
significant “Specials”, not accounted
for in the current resource work.
Implied grade loss through sampling
breakage 15%-38%, not accounted
for in the current resource work.
Lynx-Hibou dykes have a different
diamond population with a finer size
distribution and more brown colours.
Lynx/Hibou price: US$57/ct (September
Renard 3 Bulk Sample stones
2009, +1 cutoff, sensitivities of $US45 to US$85)
larger than 2 carats. “Run of Mine”
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The Route 167 Extension (“Route Des Monts Otish”)
Stornoway lends full support to the Provincial
and Federal Government, Community and
Industry partnership created to facilitate a Renard
permanent and multi-service “Route Monts
Otish” between Témiscamie and Renard.
PROPOSED
March 19th 2009: Québec announces $130m CORRIDOR
of capital funding. Mine Eastmain
$10m committed immediately for feasibility,
McLeod Lake
environmental assessment and permitting (Western Troy)
The road will potentially service four mines and Strateco)
Matoush (Strateco)
a new park. Laforge 1
Laforge 2
Brisay
LG4 Potential
LG2 LG3
Proposed Route Proposed Parc Albanel-
Powerlines
(268km) Témiscamie-Otish
Eleonore Existing Renard
Wemindji
Winter Road
Western Troy Eastmain
Strateco
Potential
Témiscamie
Troilus Mine Road
Temiscamie
Mistissini
Matagami
Chibougamau
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Next Steps
2010-2011:
Deep Exploration Drilling
Permitting
Social and Environmental Impact Assessment
Full mine feasibility
Ongoing:
Community engagement, including
consultation and negotiation designed
to lead to an Impact and Benefits
Agreement
Advocacy and engagement with
government and communities in
support of the Route 167 Extension.
Key Targets:
Production Decision: 2011
Production: 2013
Profit Margin of Developing Diamond Projects Worldwide
Margins based on regional Canadian Projects
$175.00 $175.00
op-ex generalizations
-Arctic projects - $100 US/tonne Russian Projects
-African projects - $15 US/tonne
$150.00 Australian Projects $150.00
-Remote projects (sub-arctic) - $50 US/tonne
-Central projects (good infrastructure) - $20 US tonne African Projects
$125.00 $125.00
Diavik A21 1200m
Profit Margin
Profit Margin
(US$/tonne)
Renard:
(US$/tonne)
$100.00
High In-Situ Value $100.00
High Margin
$75.00
Argyle UG $1900m $75.00
Liqhobong $850m
Gope $2800m
AK 6 $2920m
$50.00 $50.00
Kao $3052m
Star $6890m
DO-27 $950m
$25.00 Renard $25.00
Gahcho Grib $4110m
Kue $5230m
$0.00
$4490m $0.00
$30,000m $25,000m $20,000m $15,000m $10,000m $5,000m 0
2010 In Situ Value Estimates (millions of US$)
Note: Diamond price assumptions based on recent production results or published 3rd party base case valuation models
25
Corporate
26
Management and Board
Eira Thomas Matt Manson Pat Godin Zara Boldt
Executive Chairman President, CEO & COO CFO and VP Finance
& Director Director
Additional Management
Robin Hopkins, VP Exploration
Dave Skelton, VP Project Development
Ghislain Poirier, VP Public Affairs
Non-Executive Directors Nick Thomas, Manager, Investor Relations
Catherine
David Garofalo Yves Harvey Peter Nixon Tony Walsh Serge Vézina
McLeod-Seltzer
(Lead Director)
27
Backing
Financings in the Last 3 years and Estimated Current Holdings
Shares Outstanding: 288 million Closing Price May 28th, 2010 = C$0.56
Current Recent Investments
Shareholder
Shareholding Date Amount Price
Agnico-Eagle 2006 $23m $1.25 (New Equity)
2008 $11m $0.90 (Redemption of Convertible bonds)
Mines Limited 2008 $1m $0.46 (Interest payments on Convertibles)
15.8%
2010 $2.5m $0.50 (New Equity)
Total $37.5m
Rio Tinto 8.9% 2007 $32m $1.25 (Carried Interest following 2006 Ashton transaction)
Lorito Holdings 2008 $11m $0.90 (Redemption of Convertible bonds)
2009 $1m $0.46 (Interest payments on Convertibles)
(Lundin Family) 5.8% 2010 $1m $0.50 (New Equity)
Total $13m
Management 2006 $0.3m $1.13 (open market, private placement ‘pp’)
2007 $0.15m $0.71 (open market)
and Directors 2008 $0.08m $0.15 (open market, pp and prospectus)
1.8%
2009 $0.08m $0.17 (open market, prospectus)
Total $0.61m
Institutional 2007 $10m $1.20 (Common Shares)
2007 $8.9m $1.50 (New Flow-Through Equity)
Investors 49% 2008 $3.3m $0.15 (New Flow-Through Equity)
2009 $0.5m $0.17 (New Flow-Through Equity)
(estimated) 2010 $7m $0.50 (New Equity)
Total $29.7m
Retail 2007 $1.1m $1.50 (New Flow-Through Equity)
2008 $0.7m $0.15 (New Flow-Through Equity)
19% 2009 $0.9m $0.17 (New Flow-Through Equity)
(estimated) 2010 $1m $0.50 (New Equity)
Total $3.7m
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Current Financial Platform
As of May 28, 2010, unless otherwise stated
Market Capitalization: C$ 160 million
Total Shares Outstanding: 288 million
Largest Shareholder (15.8%)
Cash and Short Term
Deposits:
January 31st, 2010 and including C$ 13 million
proceeds of financing closed February
23rd and March 4th 2010)
Debt zero
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Building a Canadian Diamond Resource Base
www.stornowaydiamonds.com
TSX:SWY
30
Appendix: Mineral Resource Estimate
Published December 8th, 2009
Contained Diamond Contained
Grade Tonnes Rock Value
Kimberlite Carats Price Value
(cpht) (millions) (US$/tonne)
(millions) (US$/carat) (million US$)
Renard 2 103 17.5 18.0 $117 $121 $2,100
Renard 3 106 1.7 1.8 $117 $124 $210
Renard 4 44 7.3 3.2 $117 $51 $370
Renard 9 -- -- -- -- -- --
Lynx Dyke -- -- -- -- -- --
Hibou Dyke -- -- -- -- -- --
Total 87 26.5 23.0 $101 $2,680
Indicated (+44%) (+128%) (+228%) (+56%) (+256%)
Renard 2 120 5.4 6.4 $117 $140 $750
Renard 3 122 0.2 0.2 $117 $143 $20
Renard 4 41 4.6 1.9 $117 $48 $220
Renard 9 46 5.8 2.6 $117 $54 $310
Lynx Dyke 107 1.8 1.9 $57 $61 $110
Hibou Dyke 144 0.2 0.3 $57 $82 $20
Total 75 17.8 13.3 $80 $1,430
Inferred (+19%) (+149%) (+196%) (+38%) (+254%)
Notes Resource categories are compliant with the "CIM Definition Standards on Mineral Resources and Reserves". Mineral
resources that are not mineral reserves do not have demonstrated economic viability. Changes from NI 43-101 Mineral Resource
Estimate Published in December 2008 are shown in italics. Totals may not add due to rounding. Diamond Prices are base case
"model“ prices as determined by WWW International Diamond Consultants Ltd. following a re-valuation in September 2009.
Grades and diamond prices are estimated at a +1DTC sieve size cut-off.
31
Appendix: Potential Mineral Deposit
Published December 8th, 2009
Grade Tonnes Contained Carats
Kimberlite
(cpht) (millions) (millions)
Renard 2 -- -- -- -- -- --
Renard 3 107 to 168 0.1 to 0.2 0.1 to 0.3
Renard 4 38 to 79 5.1 to 8.2 1.9 to 6.5
Renard 9 45 to 50 3.1 to 7.2 1.4 to 3.6
Renard 65 23 to 33 12.6 to 24.0 2.9 to 7.9
Lynx 96 to 120 3.1 to 3.2 3.0 to 3.8
Hibou 104 to 151 2.7 to 2.9 2.9 to 4.3
Total PMD 26.8 to 45.7 12.2 to 26.5
Notes
The potential quantity and grade of any potential mineral deposit is conceptual in nature, and it is uncertain
if further exploration will result in the target being delineated as a mineral resource.
The potential mineral deposit for the Renard kimberlite pipes has been determined by projecting
reasonable kimberlite volumes from the base of the inferred resource to a depth of 700m below surface. In
the case of the Lynx and Hibou dykes, the potential mineral deposit was established on the basis of known
drill intersections of kimberlite for which insufficient diamond sampling exists to adequately estimate a
diamond resource grade.