swy 2013 agm presentation

BUILDING QUÉBEC’S FIRST DIAMOND MINEAnnual General Meeting of Shareholders, Montreal, October 23rd 2013

Matt MansonPresident, CEO & Director

Patrick GodinCOO & Director

2

Forward-Looking Information

This presentation contains "forward-looking information" within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as “forward-looking statements”, are made as of the date of this presentation and the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by law.

Forward-looking statements relate to future events or future performance and reflect current expectations or beliefs regarding future events and include, but are not limited to, statements with respect to: (i) the amount of mineral resources and exploration targets; (ii) the amount of future production over any period; (iii) net present value and internal rates of return of the mining operation; (iv) assumptions relating to recovered grade, average ore recovery, internal dilution, mining dilution and other mining parameters set out in the Feasibility Study or Optimization Study; (v) assumptions relating to gross revenues, operating cash flow and other revenue metrics set out in the Feasibility Study or Optimization Study; (vi) mine expansion potential and expected mine life; (vii) expected time frames for completion of permitting and regulatory approvals and making a production decision; (viii) future exploration plans; (ix) future market prices for rough diamonds; and (x) sources of and anticipated financing requirements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “anticipates”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategy”, “goals”, “objectives” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.

Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performances or achievements of Stornoway to be materially different from future results, performances or achievements expressed or implied by such statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which Stornoway will operate in the future, including the price of diamonds, anticipated costs and Stornoway’s ability to achieve its goals. Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements include, but are not limited to: (i) required capital investment and estimated workforce requirements; (ii) estimates of net present value and internal rates of return; (iii) receipt of regulatory approvals on acceptable terms within commonly experienced time frames; (iv) the assumption that a production decision will be made, and that decision will be positive; (v) anticipated timelines for the commencement of mine production; (vi) market prices for rough diamonds and the potential impact on the Renard Project’s value; and (vii) future exploration plans and objectives. Additional risks are described in Stornoway's most recently filed Annual Information Form, annual and interim MD&As, and other disclosure documents available under the Company’s profile at: www.sedar.com.

When relying on our forward-looking statements to make decisions with respect to Stornoway, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Stornoway does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by Stornoway or on our behalf, except as required by law.

Robin Hopkins, a Qualified Person and the Company’s VP Exploration, has reviewed the technical information contained herein. Readers are referred to the technical report dated December 29th, 2011 in respect of the November 2011 Feasibility Study for the Renard Diamond Project, the technical report dated February 28th, 2013 in respect of the January 2013 Optimization Study, and the press release dated July 23rd 2013 in respect of the July 2013 Mineral Resource estimate for further details and assumptions relating to the project. These techncial reports and this press release list the names of the Qualified Persons in respect of these studies.

3

Hume KyleIndependent

Zara BoldtCFO and VP

Finance

Pat GodinCOO & Director

Matt Manson President, CEO

& Director

Michel BlouinIndependent/ IQ Designate

Yves Harvey Independent

John LeBoutillierIndependent/ IQ Designate

Monique MercierIndependent/ IQ Designate

Peter NixonIndependent

Ebe ScherkusIndependent/

Board Chairman

Executive Officers

Non-Executive Directors

Key Managers

Head Office: Longueuil, Québec

Exploration Office: North Vancouver, BC

Community Offices: Mistissini & Chibougamau

Québec

Your Board and Management Team

Serge VézinaIndependent

Orin Baranowsky

Director, IR

Jean-Charles Dumont

Corporate Controller

Yves PerronVP Engineering & Construction

Ghislain Poirier

VP Public Affairs

Brian Glover VP Asset Protection

Martin BoucherVP Sustainable Development

Guy BourqueChief Mining

Engineer

Helene RobitailleDirector, HR

Robin Hopkins

VP ExplorationMario Courchesne

Construct. ManagerFreddie Mianscum

IBA Implem. Officer

4

From the 2012 AGM…

5

Comments on Stornoway’s Project Financing

The Renard Project is Ready to Build

Final Project Financing is the Last Remaining Challenge Before Construction can Begin

Despite very difficult market conditions, in the past 18 months Stornoway has successfully arranged up to

$144m of financing ($124m debt, $20m equity) for road and airport construction, permitting, design optimization

work, engineering and financing costs.

The timely completion of final mine project financing, and its impact on project schedule, is the principal risk

Stornoway currently faces.

Project financing discussions with lenders and prospective investors are ongoing and progressing well.

Stornoway is Fully Focused on the Timely Completion of Final Project Financing

6

Why does the Renard Project Stand Out from the Pack?

Renard will have a high margin with high cash flow: it is a major new project.

Renard has strong social acceptability.

Renard is in one of the world’s safest jurisdictions for mining investment (still).

Renard will be the first Canadian diamond mine with an all-season road.

Renard has enough resource upside for potentially decades of mining.

Renard is owned 100% by Stornoway: our partners are our shareholders and in our communities.

Diamonds are an essential part of our culture, and very difficult to find.

What Other Mining Project Offers all of these Advantages to Investors?

77

Renard: Québec’s First Diamond Mine

8

Lynx

N

R7

R1Hibou

R4

R9R2

R3

R65

R8

Kimberlite Bodies with Probable Reserves

Hibou

Lynx

R4

R9R2

R3

R65

Kimberlite Bodies with Resource Potential

R1Hibou

Lynx

Legend

Stornoway Properties

Hydro-Québec Facility

Renard Kimberlites

Kimberlitic Dyke

Regional Kimberlites

Hydro-Québec Powerlines

Route 167 Extension/ Renard Mine Road

Road

Exploration/ Mining Projects

LEGEND:

0 1 2

Kilometers

60 0 60 120

Kilometers

Renard

LG3LG2LG4

Laforge 1

Laforge 2

Brisay

Foxtrot Property

Strateco

Eastmain MineWestern Troy

Troilus Mine

Eleonore

Temiscamie

Mistissini

ChibougamauMatagami

Wemindji

Renard Kimberlite Bodies

Kimberlite Bodies with Inferred Resources

R10R10

9

Key Project Parameters

27 mcarat Indicated Mineral Resource

17 mcarat Inferred Mineral Resource

26-48 mcarat Exploration Upside

Reserve Based Mine Plan(Feasibility Study Nov. 2011, Optimization Jan. 2013)

Mine Life 11 years

Mineral Reserve 17.9 mcarats

Initial Cap-ex $752m

Operating Cost $58/t ($76/carat)

Operating Margin 67%

Operating Cash Flow $2.7B

Average Diamond Price $180/carat

Average Diamond Production 1.6 mcarats/yr

After Tax NPV (7%; Jan 1 2013) $391m

After Tax IRR 16.3%

Production Startup December 2015

Long Term Plan (Basis of Mine Permitting)

Includes the mining of the 17mcarat Inferred Resources within the scope of the Feasibility Study mine infrastructure: Extended mine life, increased annual production, increased project valuation

*Key Assumptions: C$1=US$1, Oil US$95/barrel, 2.5% real terms diamond price growth Q311-Q425, 82.9% ore recovery, 23.8% mining and internal dilution, 0cpht dilution grade, January 1 2013 effective date for NPV and IRR calculation.

Notes: Grades illustrated are for Indicated and Inferred Mineral Resources respectively at a +1DTC sieve size cut-off. Reserve and 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. The potential quantity and grade of any Exploration Target (previously referred to as a “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. Mineral reserves are not a sub-set of mineral resources.

Renard 460/50cpht Renard 9

53cpht

Renard 6529/24cpht

Renard 2104/119cpht

Renard 3103/112cpht

0m

100m

200m

400m

600m

700m

500m

300m

10

The Feasibility: 11 years of mining

Permitting and Long Term Business Plan

The Vision: Deposit still Open

40

60

80

100

120

140

Millions of Tonnes

20

0

Exploration Target High Range

Inferred Resource

Exploration Target Low Range

Probable Reserve

Notes: Reserve and 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. The potential quantity and grade of any Exploration Target is conceptual in nature, and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineral reserves are not a sub-set of mineral resources.

Renard’s Resource UpsideA Project with a Long Resource Tail and Very Long Mine Life Potential

The resource upside at depth at Renard is world class.

Although highly accretive, the project’s Inferred Mineral Resources are not included in the Feasibility Study economic analysis in accordance with NI 43-101.

0m

100m

200m

400m

600m

700m

500m

300m

Renard 6529/24cpht Renard 3

103/112cpht

Renard 2104/119cpht

Renard 953cpht

Renard 460/50cpht

11

Waste Rock

Processed Kimberlite Containment (PKC)

Overburden Stockpile

R2-R3

Ore Stockpile

R65

Camp

Plant

Road from Chibougamau

General Project ArrangementSmall Project Footprint of 3.1km2, Modest Environmental Impact

12Mine PlanA Combined Open Pit and Underground Mine

Renard 4

Renard 2

Renard 3

Renard 65

View looking Northeast

Renard 2 Renard 3

Open Pit Mining (years 1-2).

Underground Mining (years 3-11).

Underground method: Blast Hole Shrinkage, Panel Retreat with waste backfill from pits.

Ramp access 610 meter level.

6,000 tpd plant capacity (2.2Mtonnes/year) expandable to 7,000 tpd (2.5Mtonnes/year).

Pit at Renard 65 (initially) as a borrow-pit and waste water sump, pending resource conversion.

13Mine Plan Production Schedule and Cash Flow(Mineral Reserves Only)

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000 Open Pit & Underground Mining

R2 Pit R3 Pit R2 UG R3 UG R4 UG

Ore

To

nn

age

(t)

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000 Diamond Production

R2 R3 R4

Dia

mo

nd

s (c

arat

s)

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

-

100,000

200,000

300,000

400,000

500,000

600,000 Gross Revenue (Real Terms)

R2 R3 R4

Rev

enu

e (k

C$)

14Stornoway will be a Significant Diamond ProducerCurrent and Future Diamond Producers

Source: Kimberly process and Company Reports

1 De Beers (Anglo/Botswana) $6,100m

2 Alrosa (Russia) $4,610m

3 BHPB/Dominion Diamond (TSX: DDC) $894m

4 Rio Tinto (ASE: RIO) $741m

5 Petra (note 1; L: PDL) $403m

6 Stornoway (note 2; TSX: SWY) $306m

7 Mountain Province (note 3; TSX: MPV) $273m

8 Gem (L: GEMD) $202m

9 Lucara (note 4; TSX: LUC) $118m

10 Others $2,200m

Total $15,817m

DeBeers38%

Alrosa29% BHPB/

Domin-ion6%

RioT-into5%

Petra3%

SWY2%

MPV2%

GEM1%

LUC1%

Others14%

2012 World Diamond Production Data/ Forecast Future Production

Notes:

1. Petra 12 month results for period ending June 30, 2013

2. Renard estimated at FS average annual diamond production of 1.7 million carats, and WWW April 2011 weighted diamond price of $180/ct, un-escalated

3. Gahcho Kue estimated at 50% of FS average annual production of 4.5 million carats, and WWW April 2011 weighted diamond price of $121/ct, un-escalated

4. Karowe estimated as per Lucara FY2013 Operating Guidance.

1515

12 Months of Progress

1612 Months of ProgressWhat has been Achieved since September 2012?

1. The Road is Open

2. Permitting Authorizations are in Place

3. The Resource has Continued to Grow

4. The Project has been Optimized

17The Route 167 Extension and the Renard Mine Road The First Canadian Diamond Mine with Road Access

50 km

Renard Project

Explor./Mining Projects

Stornoway Properties

Albanel-Témiscamie-Otish Par

Segment A: 0-82kmSegment B: 82-143kmSegment C: 143-195kmSegment D: 195-240km

Legend

Renard

WesternTroy

EastmainAbitex

Strateco

Mistissini

Lac Mistassini

Lac Naococane

Lac Hecla

Lac Albanel

Km 0

Km82

Km240

Km195

Km143

Rou

te 1

67

Segments C & DStornoway

97km of Mine Road (50km/hr)

Segments A & BMin. of Transport

143km of Regional Highway (70km/hr)

Construction of an all-season access road connecting Renard to the Québec highway network began in February 2012.

Under the terms of a November 2012 agreement between Stornoway and Québec, segments A & B (143 km) are being constructed by the Ministry of Transport as the 2-lane “Route 167 Extension” and segments C & D (97 km) are being constructed by Stornoway as the single lane “Renard Mine Road”.

Under the terms of a December 2012 financing agreement, Québec has provided Stornoway financing facilities of up to $85m to complete its work, repayable upon commercial production at Renard.

On September 3rd 2013 Stornoway announced that all 4 segments have been connected and the road had opened to construction traffic, 2 months ahead of schedule.

Stornoway forecasts the cost to complete the Renard Mine Road at $70 million, approximately 10% below base budget.

18

Tree clearing and earthworks Infrastructure preparation

Culvert installation Bridge installation Last step is a topcoat gravel finish

Gravel works

Road Construction Steps

19

Views of the Road

Renard Project

Explor./Mining ProjectsStornoway Properties



Legend

Renard

WesternTroy

EastmainAbitex

Strateco

Mistissini

Lac Mistassini

Lac Naococane

Lac Hecla

Lac Albanel

Km 0

Km82

Km240

Km195

Km143

Rou

te 1

67

KM 210 KM 237

KM 155

20

Views of the Road

Renard Project

Explor./Mining ProjectsStornoway Properties



Legend

Renard

WesternTroy

EastmainAbitex

Strateco

Mistissini

Lac Mistassini

Lac Naococane

Lac Hecla

Lac Albanel

Km 0

Km82

Km240

Km195

Km143

Rou

te 1

67

KM 215

KM 228KM 236

21

Bridges

Stornoway is constructing 16 bridges on the Renard Mine Road.

Temporary bridges were first installed on all river crossings by April 2013. As of October 2013, 12 of 16 permanent bridges have been installed.

All bridges are fabricated from locally harvested, engineered wood and supplied by Nordic Structures Bois, a wholly-owned subsidiary of Chantiers Chibougamau Ltée.

22All Road Segments Connected on September 1st, 2013Two Months Ahead of Schedule and 10% Below Budget

Stornoway acknowledges the professionalism and performance of its contractors on the Renard Mine Road:

The Eskan Company

Swallow-Fournier inc.

Nordic Structures Bois

Jos Ste-Croix & Fils Ltée

Eenatuk Forestry Corp.

Kiskinchiish Corp.

Petronor

23

Construction to Commence on Renard Aerodrome

The Renard Aerodrome will be located 8 km south of the project site.

The airstrip will be certified by Transport Canada to receive Dash 8-300 turboprop and Hercules aircraft.

Design criteria (3C-NP):

Gravel surface

30m wide by 1,494m long

Taxiway and 100mx100m apron

Equipped with assisted landing capability

Traffic will be 3 to 5 flights per week for 48 workers per flight.

The Renard Mine Aerodrome will be available for public use, enhancing air transport in the Monts Otish region of Québec.

ApronRunway Taxi wayShoulder

Renard Project Site

On October 10th Stornoway announced an agreement with Québec to commence

construction of the Renard Mine Aerodrome immediately, utilizing the residual amount of financing available within the Renard Mine

Road credit facility.

24Aerodrome ProgressOctober 2013

Tree Cutting Area

RunwayCenterline

25Site ProgressOctober 2013

R65 Borrow Pit

Tree Clearing

Bulk Sample DMS Plant

Construction Camp

Renard Mine Road

R65

R2R9

R4

26Permitting and Social AcceptabilityStrong Regulatory and Public Support for Québec’s First Diamond Mine

Social Licence

Permitting

March 2012: Impact and Benefits Agreement (“IBA” or the “Mecheshoo Agreement”) with the Cree Nation of Mistissini and the Grand Council of the Crees (EI).

July 2012: Partnership Agreements Signed with Chibougamau and Chapais.

Oct. 2012: Québec Mining Lease issued.

Dec. 2012: Québec Certificate of Authorization issued.

Dec. 2012: Closure Plan accepted by regulators.

May. 2013: Renard Mine Road Permit issued.

July 2013: Positive Federal Environmental Assessment decision issued.

All Community Agreements and Regulatory Authorizations Required to Proceed to

Construction are in Place.

27

Regulatory and Fiscal Regime in Québec Settled

The last 12 months has seen proposed changes to the Québec’s system of mining taxes and royalties, and mine closure bonds.

Stornoway participated in the Government of Québec’s consultation process and, although impacted by these changes, welcomes the balanced approach that has been taken.

Québec remains a leading destination for mining investment, and we look forward to developing Renard at a time of regulatory and fiscal certainty.

For mine planning, Stornoway assumes the new hybrid fiscal regime, being the greater of the “Minimum Mining Tax” or “Progressive Mining Tax”

Stornoway does not anticipate a major impact on the Renard Project from the new Mining Act still under assessment in the Québec National Assembly.

Québec remains one of the world’s leading mining jurisdictions offering :• Regulatory Stability• Institutional Support• Expertise• Infrastructure

28The Renard Optimization StudyReleased January 2013

Accommodation Complex

Process and Power Plants

Since the release of the Renard Feasiblity Study in November 2011, Stornoway has sought improvements in the project’s cost and operating parameters.

The Renard Optimization Study was released in January 2013, and included:• A reduced initial capital cost, principally

through deferral of the shaft.• Increased project NPV and IRR.• Maintained high operating margin.• A refined underground mining sequence

and draw point design.

Additional design optimization and engineering work is ongoing in partnership with a joint venture made up of SNC-Lavalin Inc. and AMEC Americas Ltd. under an interim agreement pending completion of the project’s EPCM contract at time of project financing.

29Liquefied Natural Gas Power PlantFeasibility Study Released October 2013

With a view to project optimization, Stornoway has been investigating more cost efficient alternatives for on-site power supply than traditional diesel fuelled gen-sets.

A Hydro-Quebec powerline has been ruled out in the short term due to high cap-ex cost.

On October 21st Stornoway announced it will proceed with an LNG fuelled gen-set option, made possible by the ability to receive regular cryogenic LNG shipments on the Renard Mine Road.

The Renard LNG plant will comprise seven 2.1MW rated gas gen-sets, providing sufficient power generation capacity for the project’s normal operating specification of 9.5MW.

30Liquefied Natural Gas Power PlantFeasibility Study Released October 2013

An LNG fuelled powerplant for Renard offers many advantages over diesel:• Greatly reduced annual operating costs of $8m to $10m per year, for a small incremental capital cost

of $2.6m.• Up to 43% less greenhouse gas emissions.• Long term, stable supply market utilizing existing commercial distribution network within Quebec.• Elimination of on-site propane, as LNG will be used for building and underground mine heating.

Diesel will continue to be used for the mobile mining fleet and construction activities

Cost Improvements with LNGJan 2013

Optimization Study with Diesel

Jan 2013 Optimization Study

with LNG

Unit Power Cost (C$/kWh) 1 $0.299 $0.188 (-37%)

Unit Operating Cost (C$/tonne) 1,2 $57.63 $53.84 (-7%)

Initial Capital Cost (C$m) 1 $752.1 $754.0 (+0.3%)

Life of Mine Capital Cost (C$m) 1,3 $1,013 $1,010 (-0.3%)

Annual Diesel Consumption (million litres) 27.5 5.9 (-79%)

Annual LNG Consumption (thousand m3/annum) n/a 41.7

Annual Propane Consumption (thousand m3/annum) 3.5 n/a

Notes

1. January 2013 Optimization Study costs expressed in October 2012 terms.

2. Excludes capitalized preproduction costs.

3. Includes all initial, sustaining and deferred capital, contingencies and escalation

Key Assumptions

Based on the 11 year reserve-based mine life (17.9 mcarats) contained within the January 2013 Optimization Study, with a normal operating load of 9.49MW, C$1=US$1, Oil US$95/barrel

31

In July 2013 Stornoway release the results of a revised

Mineral Resource Statement with a 14% increase in contained carats within the Indicated Resource category.

This followed the successful completion of a 5,000 tonne bulk sample at Renard 65 in 2012 and the recovery of 997 carats of diamonds for valuation.

The Renard 65 bulk sample returned the highest value diamonds to date at the Renard Project, with a March 2013 valuation of US$250/ct, giving a base model of US$180/ct (sensitivities of $203 & $169).

Upon conversion to a Mineral Reserve, this material may be incorporated into the mine plan in two ways:

1. add 1 year to the LOM and increase the production rate to 2.5Mt/a or

2. add 3 years to the LOM as a reserve tail at a production rate of 2.1Mt/a

The cost of developing a 75m deep pit at Renard 65 is already contained within the Feasibility Study.

Renard 2

Renard 3

Renard 9Renard 4

Renard 65

Three Renard 65 diamonds: 9.78 ct and 6.41 ct diamonds recovered from the 2012 bulk

sample and a 4 carat stone discovered in drillcore in 2003

Renard’s Resource is Continuing to GrowRevised Mineral Resource Statement Release July 2013

Notes: Reserve and 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. The potential quantity and grade of any Exploration Target is conceptual in nature, and it is uncertain if further exploration will result in the target being delineated as a mineral resource. Mineral reserves are not a sub-set of mineral resources.

32

490 m asl

-275 m asl

0 m

790 m

Renard’s Resource is Continuing to GrowResource Expansion in 2013, and Beyond

Renard 2 Renard 3 Renard 4 Renard 65 Renard 9

1. Conversion of Renard 65 Inferred Resources to Indicated to 150m depth (July 2013: Completed)

2. Addition of Renard 2 Country Rock Breccia to both Indicated and Inferred Resources (July 2013: Completed)

3. 6.2 mcarats in 5.23 Mtonnes (at 119 cpht) in Renard 2 Inferred Resources between 610m and 700m depth: 4.2 to 7.3 Mcarats TFFE between 700m and 770m depth. Open below 770m. (Target for Future Exploration)

12

3




33Renard Resource UpsideInferred Resources and TFFE Not in Reserve Case Mine Plan

0m

100m

200m

400m

600m

700m

500m

300m

0.8 to 2.8 mcarats

0.6 mcarats

6.2 mcarats

4.2 to 7.3 mcarats

1.2 mcarats

2.7 mcarats

7.3 to 13.5mcarats

5.6 to 11.8 mcarats

2.0 to 4.3 mcarats

Notes: Reserve and 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. The potential quantity and grade of any Exploration Target (previously referred to as a “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. Mineral reserves are not a sub-set of mineral resources.

Renard’s Inferred Resources and TFFE represent a potential increase over the current Indicated Resource

of 160% to 240%.

Each kimberlite remains open at 770m depth

2.4 mcarats 1.2

mcarats




34Renard’s DiamondsRecent Valuation Conducted by WWW International Diamond Consultants Ltd. March 2013

The Renard kimberlite pipes have similar, but marginally different diamond populations exhibiting coarse size distributions and with high proportions of large white gems.

99% by weight gem/near-gem quality. 1% industrial quality boart.

Significant value upside in large gems. Diamonds larger than 10.8ct, “Specials”) estimated at three to six 50-100ct stones and one to two +100ct stones every 100,000 carats (two weeks). Not accounted for in the revenue model.

Stornoway most recently valued the Renard diamond samples with WWW International Diamond Consultants Ltd. in March 2013.

Kimberlite Body

Size ofValuation Sample(carats)

WWW March 2013 Sample

Price(US$/carat)1

WWW March 2013 Base Case Price

Model(US$/carat)1

Sensitivities(Minimum to High)

Renard 2 1,580 $180 $190 $171 to $214

Renard 3 2,753 $173 $151 $141 to $185

Renard 4 2,674 $100 $104 ($150)2 $98 to $168

Renard 65 997 $250 $180 $169 to $203

Notes

1. All prices in US$/carat. Samples utilizing a +1 DTC sieve size cut-off.

2. Should the Renard 4 diamond population prove to have a diamond population with a size distribution equal to the average of Renard 2 and 3, WWW have estimated that a base case diamond price model of

$150 per carat based on March 2013 pricing.

Renard 3 Bulk Sample Stones larger than 2 carats. “Run of

Mine”

35Rough Diamond Price MovementsThe Diamond Market, January 2010 to September 2013

May 2011 Valuation utilized in the FS based

on the average of 5 diamantaires c.10%

below the WWW rough index price

A tracking of the diamond market since the publication of the November 2011 FS indicates rough diamond prices have generally remained within the bounds of sensitivities contained within the FS financial model (May 2011 spot prices and a 2.5% real terms annual price escalator).

3636

Renard’s Legacy

37

10.15 carat gem quality

octahedron

Renard’s Legacy

Value Creation for our Shareholders

An Example of Constructive Partnership with Local People• Stornoway’s relationship with the Crees of Eeyou Istchee• Stornoway’s relationship with Chibougamau and Chapais

Québec Institutional Equity Ownership• Stornoway’s Largest Shareholder is Investissement Québec, at 35% (fully diluted).

An Economic Engine in the James Bay Region of Québec• Long Term Direct and Indirect Employment• Long Term Local Contracting and Purchasing

A Catalyst for Public Infrastructure Development• The Route 167 Extension/Renard Mine Road• A New Aerodrome in the Otish Mountains

An Important Government Revenue Base• Federal and Québec Income Tax• Québec Mining Duty• Personal Income Taxes and Sales Taxes

38Renard’s LegacyMines are Wealth Generators

Notes: As estimated by Stornoway based on the Renard Feasibility Study Optimization dated January 2013, and existing tax regimes. In nominal terms. Québec Mining Duties subject to certain refundable credits

Over the First 11 Years Alone:

$907m of tax payments, royalty payments, and Public infrastructure support payments.

Payments associated with the project’s Long Term Business Plan are substantially higher still.

Federal Income Tax $188

Québec Income Tax $163

Québec Mining Duties $372

DIAQUEM Royalty $94

Contribution to the Renard Mine Road and Aerodrome $77

Maintenance Contribu-tion to the Renard

Mine Road $13

39Renard’s LegacyMines Employ People

Notes: As estimated by Stornoway based on the Renard Feasibility Study Optimization dated January 2013

Around 7,000 person years of employment created during construction (2013-2016).

Annual average of 482 direct jobs (Stornoway and contractors) created during operations (2016-2027).

405 Stornoway employees with an average salary of $115 000/y (including benefits).

An estimated of 740 jobs maintained or supported at suppliers and local merchants.

Annual operating expenditures on Québec goods and services of $90m (73% of total).

Stornoway Direct Employment

21%

Indirect Employment with Suppliers

36%

Induced Employment42%

Construction Employment Breakdown

Q3-20

13

H1-20

14

H1-20

15

H1-20

16

H1-20

17

H1-20

18

H1-20

19

H1-20

20

H1-20

21

H2-20

22

H2-20

24

H1-20

260

100

200

300

400

500

600

700 Direct Renard EmploymentConstruction

Contractors

Process Plant

Underground

Open Pit

G & A

Ma

np

ow

er

4040

What to Expect

41

Project Schedule

BFS (Complete)

ESIA (Complete)

Community Hearings (Complete)

Reg. Authorizations (Complete)

Specific Operating Permits (50)

Detailed Engineering

Project Financing

Road Construction

Site Construction

Commissioning and Ramp-up

Commercial Production

2011

2H 2H 2H 2H2H 1H 1H 1H1H

2012 2013 2014 2015

2H1H

2016

First Vehicle Access

With first vehicle access achieved on the Renard Mine Road, the timely completion of mine project financing is the now principal driver on project schedule

42

Québec’s First Diamond Mine is Ready to Build

Project Green-lighted: Authorizations Issued

Community Agreements in Place

Stornoway Operating Team in Place

Access Road Opened

Resource Growing

Project Design Fully Optimized

Favourable Cost Environment

Stornoway is Fully Focused on the Timely Completion of Final Project

Financing