Star - Orion South Diamond Project - Significant Proportion of Type IIa
Diamonds Present at Star

Stock Symbol: SGF: TSX

SASKATOON, June 9 /CNW/ - George H. Read, P. Geo., Senior Vice President Exploration & Development, is pleased to announce that 26 percent of all diamonds exceeding 2.7 carats in size from the Star underground bulk sample are Type IIa diamonds.

Type IIa diamonds are rare and account for probably less than 2 percent of all natural rough diamonds in the world. Only a small number of active diamond mines regularly produce Type IIa diamonds and the most important of these mines is Letseng-la-Terae (Letseng Mine) in the Kingdom of Lesotho. While Letseng is a low grade (1.5-3 cpht) kimberlite it is probably the most prolific source of large high-value Type IIa diamonds, which make it a highly economic deposit. A recent study on plus 2.7 carat diamonds from Star shows that Star has a similar proportion of Type IIa diamonds to Letseng.

Type IIa diamonds contain no nitrogen or boron impurities and are frequently either top white colours (D, E, F or G) or any shade of brown. Many pink and brownish-pink diamonds are also Type IIa. Type IIa diamonds usually have anhedral crystal shape and exhibit a range of elongated, distorted or irregular morphologies. Most importantly, many high-value, top colour, large specials (greater than 10.8 carats) are Type IIa diamonds, which include all of the ten largest known rough diamonds recovered worldwide, from the 726 carat Jonker to the 3,106 carat Cullinan.

The coarse diamond size frequency distribution for the Star diamond populations (particularly the Cantuar and Early Joli Fou kimberlite units), combined with this significant proportion of Type IIa diamonds, strongly suggests the potential for the recovery of large (plus 100 carat), high quality diamonds at Star. Based on the coarse diamond size frequency distribution for the Star diamond populations, the processing plant contemplated for the Star - Orion South Diamond Project is being designed to recover diamonds between 1 and 45 millimetres, which enables the recovery of diamonds up to 800 carats, depending on their shape.

The Type Ia and Type IIa diamond counts and the percentage of Type IIa diamonds for each of the Star kimberlite units are documented in the table below.

    
    -------------------------------------------------------------------------
                                Number of Diamonds
    Kimberlite      -----------------------------------------     Percentage
     Unit            Type Ia        Type IIa           Total        Type IIa
    -------------------------------------------------------------------------
    Cantuar               42              17              59           28.81
    -------------------------------------------------------------------------
    Pense                 16               8              24           33.33
    -------------------------------------------------------------------------
    EJF                  132              43             175           24.57
    -------------------------------------------------------------------------
    MJF/LJF                2               0               2               0
    -------------------------------------------------------------------------
    TOTALS               192              68             260           26.15
    -------------------------------------------------------------------------
    

The diamond type is determined using Fourier Transform Infra Red (FTIR) spectroscopy, which is a non-destructive analytical method, that enables the categorization of diamonds by the presence (or absence) of nitrogen in their crystal structure. The FTIR spectra for all 260 diamonds, greater than 2.7 carats from the Star Kimberlite evaluation parcel, were measured by a Shore personnel using analytical equipment at the University of Saskatchewan at Saskatoon. This work was documented in the in-house report: Fourier Transform Infra Red spectroscopy of the large diamonds recovered from the Star Kimberlite at Fort a la Corne, Saskatchewan. A copy of this report is available on the Shore website: www.shoregold.com.

Statistics on the proportions of Type IIa diamonds produced by diamonds mines are not freely available. However, Bowen et al (2009) published Type IIa FTIR measurements for 484 plus two carat diamonds from the Letseng Diamond Mine. The Letseng Mine has a low grade of some 1 to 3.5 carats per hundred tonnes but is highly economic as a result of its unusually high diamond price (US$1,753 per carat in Q1 2010). Letseng accounts for some 30 percent of the world market share of diamonds greater than 25 carats and has produced some of the biggest gem quality diamonds recovered in the last five years including the 603 carat Lesotho Promise, the 493 carat Letseng Legacy and the 478 carat Light of Letseng. These are all Type IIa diamonds.

The proportion of Type IIa diamonds for the respective size fractions between 2.7 and greater than 10 carats for both Star and Letseng are listed in the following table.

    
    -------------------------------------------------------------------------
                            Letseng                        Star
    Diamond Size  -----------------------------------------------------------
     Carats        Type     Total   Percentage   Type     Total   Percentage
                    IIa               Type IIa    IIa               Type IIa
    -------------------------------------------------------------------------
    greater
     than 2.7        87       298        29.19     68       260        26.15
    -------------------------------------------------------------------------
    greater
     than 3          74       244        30.33     63       232        27.16
    -------------------------------------------------------------------------
    greater
     than 4          52       153        33.99     43       146        29.45
    -------------------------------------------------------------------------
    greater
     than 5          40        97        41.24     28        84        33.33
    -------------------------------------------------------------------------
    greater
     than 6          29        66        43.94     19        58        32.76
    -------------------------------------------------------------------------
    greater
     than 7          26        52        50.00     17        44        38.64
    -------------------------------------------------------------------------
    greater
     than 8          18        32        56.25     12        35        34.29
    -------------------------------------------------------------------------
    greater
     than 9          15        26        57.69      8        26        30.77
    -------------------------------------------------------------------------
    greater
     than 10         13        19        68.42      8        21        38.10
    -------------------------------------------------------------------------
    

The table above shows that the proportion of Type IIa diamonds in the Star Kimberlite is similar to the proportion of Type IIa diamonds in Letseng. However, the grade of Star is some seven times greater than Letseng. It has been stated that Type IIa diamonds are usually either top white or brown in colour and it is, therefore, important to confirm that high value, white Type IIa diamonds do occur at Star. The recent diamond valuation exercise has shown that the Star underground bulk sample produced 34 diamonds valued at $5,000 or more and FTIR spectroscopy has confirmed that the following nine high value diamonds are Type IIa.

    
    -------------------------------------------------------------------------
    Kimberlite Unit      Carats         $/carat        Dollars      Type IIa
    -------------------------------------------------------------------------
    EJF                    3.38           5,630         19,000           Yes
    -------------------------------------------------------------------------
    Cantuar/EJF            3.49           4,900         17,100           Yes
    -------------------------------------------------------------------------
    EJF                    6.53           1,860         12,100           Yes
    -------------------------------------------------------------------------
    EJF                   19.66             590         11,600           Yes
    -------------------------------------------------------------------------
    EJF                   11.63             880         10,200           Yes
    -------------------------------------------------------------------------
    EJF                    5.69           1,530          8,700           Yes
    -------------------------------------------------------------------------
    EJF                    2.96           2,940          8,700           Yes
    -------------------------------------------------------------------------
    EJF                   14.44             470          6,800           Yes
    -------------------------------------------------------------------------
    EJF                    4.78           1,313          6,300           Yes
    -------------------------------------------------------------------------
    

Senior Vice President Exploration & Development, George Read, states: "The presence of a significant proportion of Type IIa diamonds greatly increases the potential for the recovery of large (plus 100 carat), high-value diamonds at Star. Study of the Star diamond evaluation parcel shows that it contains both top white octahedral diamonds (Type Ia) and a significant proportion of Type IIa diamonds, some of which are top white in colour. The presence of these two high-value diamond groups (octahedra and Type IIa) greatly strengthens the future potential production diamond pricing at Star."

Senior Vice President Exploration and Development, George Read, Professional Geoscientist in the Provinces of Saskatchewan and British Columbia, is Shore's Qualified Person responsible for the verification and quality assurance of analytical results. Shore is a Canadian based corporation engaged in the acquisition, exploration and development of mineral properties. Shares of the Company trade on the TSX Exchange under the trading symbol "SGF".

References (Available on Shore website: www.shoregold.com)

Bowen, D.C. Ferraris, R.D. Palmer, C.E. and Ward, J.D. (2009) On the unusual characteristics of the diamonds from Letseng-la-Terae kimberlites, Lesotho. Lithos Vol. 112S pp.767 - 774.

Breeding, C.M. and Shigley, J.E. (2009) The "Type" classification system of diamonds and its importance in gemology. Gems & Gemology Vol. 45 No. 2 pp. 96 - 111

Caution Regarding Forward-Looking Statements

This news release contains forward-looking statements as defined by certain securities laws, including the "safe harbour" provisions of the Ontario Securities Act and the United States Private Securities Litigation Reform Act of 1995. The words "may," "could," "should," "would," "suspect," "outlook," "believe," "plan," "anticipate," "estimate," "expect," "intend," and words and expressions of similar import are intended to identify forward-looking statements, and, in particular, statements regarding Shore's future operations, future exploration and development activities or other development plans containing forward-looking statements.

These forward-looking statements are based on Shore's current beliefs as well as assumptions made by and information currently available to Shore and involve inherent risks and uncertainties, both general and specific, concerning anticipated financial performance, business prospects, strategies, regulatory developments, development plans, exploration, development and mining activities and commitments. Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Risks exist that predictions, forecasts, projections and other forward-looking statements will not be achieved due to a number of factors including, but not limited to, developments in world diamond markets, changes in diamond valuations, risks relating to fluctuations in the Canadian dollar and other currencies relative to the US dollar, changes in exploration, development or mining plans due to exploration results and changing budget priorities of Shore or its joint venture partners, the effects of competition in the markets in which Shore operates, the impact of changes in the laws and regulations regulating mining exploration and development, judicial or regulatory judgments and legal proceedings, operational and infrastructure risks and the additional risks described in Shore's most recently filed Annual Information Form, annual and interim MD&A and short form prospectus. Shore's anticipation of and success in managing the foregoing risks could cause actual results to differ materially from what is anticipated in such forward-looking statements.

Although management considers the assumptions contained in forward-looking statements to be reasonable based on information currently available to it, those assumptions may prove to be incorrect. When making decisions with respect to Shore, investors and others should not place undue reliance on these statements and should carefully consider the foregoing factors and other uncertainties and potential events. Unless required by applicable securities law, Shore does not undertake to update any forward-looking statement that may be made.

SOURCE Shore Gold Inc.

For further information: For further information: Joseph Dickson, Investor Relations Manager at (306) 667-3505 and www.shoregold.com


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