Stornoway Diamond Corporation reported production and sales results of Renard Diamond Mine for the first quarter ended March 31, 2018. The first quarter sales of 399,135 carats represented run-of-mine production recovered between October 2017 and January 2018. Gross proceeds were CAD 56.4 million at an average price of USD 112 per carat. On a segmented basis, 286,051 carats of +7 DTC sieve size diamonds were sold at an average price of USD 148 per carat, and 113,083 carats of -7 DTC sieve size diamonds were sold at an average price of USD 20 per carat. Revenue from the third sale of the quarter will be recorded in the second quarter, as deliveries to clients were made subsequent to the quarter-end. In addition to the sale of run of mine production, an additional 42,663 carats of diamonds smaller than the -7 DTC sieve size were sold in an out of tender contract sale for gross proceeds of CAD 1.0 million at an average price of USD 18.50 per carat. These represent recoveries of small diamond "incidentals" produced between October 2017 and February 2018 that are in excess of that expected from the Renard Mineral Resource. The sale of such incidentals represents incremental revenue above that provided for in Stornoway's fiscal year 2018 segmented sales guidance.

First quarter mine production was 285,851 carats recovered from the processing of 562,520 tonnes of ore at an attributable grade of 51 carats per hundred tonnes ("cpht"). During the quarter, mining in the Renard 2-Renard 3 open pit was hampered by poor weather conditions which restricted mining access and impacted equipment availability. In addition, approximately 55,000 tonnes of high grade Renard 2 ore which was scheduled for mining at the base of the pit could not be recovered due to unsafe working conditions adjacent to the west pit wall. This resulted in a higher proportion of low grade stockpile material being processed during the quarter than was planned, with a commensurate reduction in carat recoveries. In addition, the extreme weather conditions resulted in lower than expected plant availability, as ore froze in feed-bins. Processing rates in the quarter averaged 6,250 tonnes per day compared to an annual plan of 7,000 tonnes per day. By the end of the quarter, open pit mining at Renard 2 had been completed, and a progressively higher proportion of processed ore was being derived from the Renard 2 underground mine. Processing in March averaged 6,750 tonnes per day.

Higher than budgeted carat production in the remainder of the year will be required to achieve Stornoway's full year 2018 production guidance of 1.6 million carats produced and 1.6 million carats sold.