Peregrine finds new diamond-rich kimberlites That adds more economic potential to its Chidliak property

Peregrine Diamonds Ltd. said today that it’s found three new diamond-rich formations called kimberlites on its Chidliak property.

These kimberlites, volcanic rocks that often contain diamonds. were discovered by drilling on the property, located about 100 kilometres northeast of Iqaluit on the Hall Peninsula.

Since 2008, Peregrine has drilled more than 50 targets around the 8,500 sq. km. property.

Seven of those formations have the economic potential to be mined.

Earlier this year, Peregrine Diamonds Ltd. and BHP Billiton said they would spend $17.7 million in 2011 on exploration at Chidliak.

Within 10 years, depending on whether the exploration results “can put meat on the table,” and the project passes all permitting hurdles, there may be a diamond mine as large or larger than BHP’s Ekati diamond mine in the Northwest Territories, company president Brooke Clements Clements told Nunatsiaq News earlier this year.

A deep sea port in Iqaluit and a road inland to the site could follow.

Chidliak’s location, close to Iqaluit and 180-km south of Pangnirtung, is a plus for any future mine, he said.

For now, the main impact of Peregrine’s exploration activities and similar exploration projects across Nunavut now lies in the money they pump into the territory’s economy through exploration: this is expected to reach $322 million in 2011, up from $263 million in 2010.