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Margaret Lake Diamonds Announces Arctic Star confirms diamonds at the Sequoia Kimberlite Complex from first laboratory results, Diagras Project, NT

Corporate Updates

Margaret Lake Diamonds Announces Arctic Star confirms diamonds at the Sequoia

Kimberlite Complex from first laboratory results, Diagras Project, NT

VANCOUVER, BC / Friday July 6, 2021 / Margaret Lake Diamonds Inc. ("MLD" or the

"Company") (TSXV:DIA) (FKT:M85) (OTC PINK:DDIAF) is pleased to announce Arctic Star

Exploration Corp. has received the first diamond results from its Spring drilling program where 5

new kimberlites were discovered. The first results are from the Sequoia kimberlite complex and

are described below in table 1.

Table 1. Caustic Fusion Results, Sequoia Kimberlite

Drill hole 0.105m

m

0.15mm 0.212m

m

0.3mm 0.425m

m

0.6m

m

0.85mm Weight

Kg

Total

stones

Stone

s/100k

g

DG2021-04 122 47 9 7 4 2 0 221.75 191 86

DG2021-05 24 7 2 0 0 0 0 70.85 33 47

Sequoia

Total

146 54 11 7 4 2 0 292.60 224 76

Notes on the results: The kimberlite was sent to SRC laboratories of Saskatoon by chain of

custody. SRC is an independent laboratory that is SCC accredited, ISO/IEC 17025. The

samples are assayed using the caustic fusion process, where up to 8-kilogram samples are

fused in a kiln containing caustic soda at temperatures of >500oC. The hot residue is then

poured through sieves and the remaining material is then chemically treated to reduce the

residue to a manageable size. The concept being the Caustic fusion and chemical treatments

removes most of the material leaving only diamond and refractory minerals. The residues are

then observed and the diamonds are recovered. The lab adds unique diamonds to each

sample, which are recovered as part of a quality assurance program.

The Spring drilling program was designed to discover as many new kimberlites as possible

within the given time and budget, the idea was to tag the kimberlite with one or two drill holes

and return to them for further work if diamonds were present. Arctic Star has successfully shown

the existence of the large kimberlite complex at Sequoia and they now know that it is

significantly diamond bearing. Further work is therefore warranted.

Notable from table 1 is the contrasting diamond counts between drill holes 04 and 05. Drill hole

DG2021-04 has almost twice the diamond count of 05, indicating variable diamond grades

within this large kimberlite complex. Figure 1 shows the location of the two drill holes, with a

background of the gravity anomaly thought to map the complex. The two holes where drilled

220m apart into contrasting parts of the complex.

The lab has given descriptions of the dozen or so larger diamonds. They are all reported to be

white in colour. The majority, 75%, are described as clear, the rest are described as off white or

cloudy. It is to early to say much about the quality of the diamonds at this stage. A large sample

of commercial sized diamonds is required, for this. It can be said that it is more encouraging to

have clear white stones that to have the diamonds described as boart, no brown or boart stones

have been noted from these samples.

The next step would be to drill test all the sectors of the kimberlite complex with several drill

holes to understand the geology and diamond distribution. Figure 1 shows areas that need to be

tested with orange brackets. This would allow for further focus (more drilling for tonnage and

bulk samples for grade and price) on the higher diamond count portions of the complex in the

future, if warranted. Ideally each 15 million tonne portion of the complex would need 2-3 holes

into it, before garnering an initial understanding of the geology and diamond distribution.

Figure 1. Location of the Spring 2021 Sequoia complex drill hole, background is a colour grid of the

ground Gravity data (0.1milligal contours), Black dots are the gravity stations. Blue lines outline lakes.

Orange brackets highlight sizable tracks of the complex that require testing by drill holes.

Helicopter supported drilling at the Sequoia target is possible most times of the year (Nov. –

Jan. not recommended due to darkness, limiting aviation), as parts occur on land or can be

drilled from the shore using angled holes and could commence on financing. The target is only

6.2 kilometers from the exploration camp.

The Diagras project is a Joint Venture between Arctic Star and Margaret Lake Diamonds Inc.

(“DIA”). Arctic Star took over management of the Diagras project this year and proposed a $2.1

million “spring 2021” budget to drill geophysical targets on the property. At the end of this

budget period, July 31st, 2021, the ownership will be approximately 80% Arctic Star, 20% DIA. A

new “Summer/Fall” budget, which will include further drilling at Sequoia, will be discussed within

the JV in July.

The caustic fusion diamond results from the other kimberlites discovered are awaited and are

expected in the next 3-6 weeks.

Qualified Person

The Qualified Person for this news release is Buddy Doyle, AUSIMM, a Geologist that is

employed by and works for Arctic Star with over 35 years’ experience in diamond exploration,

discovery, and evaluation. A Qualified Person under the provisions of National Instrument 43-

101.

Contact Information

Neil Foran

Chief Executive Officer

(604) 681-7735

[email protected]

Forward-Looking Statements

This press release contains forward -looking information or forward -looking statements

(collectively "forward -looking information" ) within the meaning of applicable securities laws.

Forward-looking information is typically identified by words such as: "believe", "expect",

"anticipate", "intend", "estimate", "potentially" and similar expressions, or are those, which, by

their nature, refer to future events. The Company cautions investors that any forward -looking

information provided by the Company is not a guarantee of future results or performance,

and that actual results may differ materially from those in forward -looking information as a

result of various factors. The reader is referred to the Company's public filings for a more

complete discussion of such risk factors and their potential effects, which may be accessed

through the Company's profile on SEDAR at www.sedar.com .