Karelian Diamond Res.

New Micro-Diamond Results From Lahtojoki Diamond Deposit

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

Karelian Diamond Resources plc

(“Karelian Diamonds” or “the Company”)

13 August 2018

NEW MICRO-DIAMOND RESULTS FROM LAHTOJOKI DIAMOND DEPOSIT

Karelian Diamond Resources plc (“Karelian Diamonds”) (AIM: KDR), is pleased to announce the micro-diamond results on drill core from the previously untested Eastern Lobe of the Lahtojoki two hectare diamond deposit over which the Company holds a mining concession.

The analyses, performed by Microlithics Laboratories Inc. in Thunder Bay, Canada have yielded micro-diamond results comparable to those for the smaller Central and Western portions. The results indicate the potential for high quality diamonds of good colour and shape.

Highlights

Professor Richard Conroy, Chairman, Karelian Diamond Resources plc commented:

These early-stage results not only serve to confirm the validity of earlier analyses by a previous operator, but also indicates that the grade, modelled at 40 carats per hundred tonnes from past micro-diamond results, could be reasonably extended into the Eastern Lobe of the Kimberlite at depth. As such they give the Company increased confidence in an economically robust project, as outlined in the PEA undertaken in 2017.”

Further Information

kg #>106 µm #>150 µm #>212
µm
#>300 µm #>425 µm #>600 µm #>850 µm Total
93.19 23 21 6 6 2 2 1 61

   

kg Stones Stn/100kg -450µm:+450µm* #+850µm % Stns +850µm
Historical 1,771.17 1,096 61.9 6.3:1 21 1.9%
KDR 2018 93.19 61 65.5 6.6:1 1 1.6%
*  Ratio of +150-450µm versus +450µm-1,180µm micro-diamonds.

The Lahtojoki Project – PEA Economics

The 2017 PEA indicates 2+M carats recoverable with an in-situ value of US$211 million, and recommended an open/vertical pit mining operation. The life-of-mine is 9+ years with payback by year two, an IRR of 55% and an NPV (@8%) of US$ 39.1M.

This release has been approved by Kevin McNulty PGeo, who is a member of the Company's technical staff and holds a BSc/MSc in Geology and Remote Sensing, in accordance with the guidance note for Mining, Oil & Gas Companies issued by the London Stock Exchange in respect of AIM Companies, which outlines standards of disclosure for mineral projects.

For further information please contact:

Conroy Gold and Natural Resources plc Tel: +353-1-479-6180
Professor Richard Conroy, Chairman
Allenby Capital Limited (Nomad) Tel: +44-20-3328-5656
Virginia Bull/Nick Harriss
Brandon Hill Capital Limited (Broker) Tel: +44-20-3463-5000
Jonathan Evans
Lothbury Financial Services Tel: +44-20-3290-0707
Michael Padley
Hall Communications Tel: +353-1-660-9377
Don Hall

www.kareliandiamondresources.com