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Margaret Lake Diamonds announces Arctic Star Sequoia Kimberlite Complex’s Indicator Mineral Chemistry Points to Large Diamonds, Diagras Project, NWT

Corporate Updates

Margaret Lake Diamonds announces Arctic Star Sequoia Kimberlite Complex’s Indicator

Mineral Chemistry Points to Large Diamonds, Diagras Project, NWT

VANCOUVER, B .C. / September 9 th 2021 / Margaret Lake Diamonds Inc. ("MLD" or the

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

Arctic Star has received diamond indictor mineral results and an interpretation of these from

Chuck Fipke for the first hole into the Sequoia Kimberlite complex. The results demonstrate the

existence of a number of indicator types that occur with diamonds and strongly suggest the

presence of diamonds. Furthermore, indicator minerals of identical multi-element chemistry to

those found as inclusions in large >50-carat diamonds worldwide are abundant. The indicators

from different kimberlite types are starkly different. These observations are in agreement with

the caustic diamond results, which show the different kimberlite types have different stone/kg

counts and also hints at a coarse diamond distribution. Ultimately a bulk sample will be required

to confirm the diamond distribution and this is the normal path of progress for diamond

exploration. Prior to this, a drill program defining the volumes of the different kimberlite types

and their caustic fusion diamond distribution is planned for spring 2022.

Samples of kimberlite core were sent to C.F. Mineral Research Ltd. in Kelowna, B.C. for

indicator mineral analysis. C.F. Minerals is a global-leading kimberlite and diamond analytical

research facility lead by Chuck Fipke - one of the founders of the Ekati diamond mine. At the lab,

the samples were lightly crushed with heavy minerals separated by dense media gravity methods.

Oxides and silicates are split using magnetic separation. Candidate diamond indicator minerals

are selected by a minerologist, mounted and scanned for chemical composition using a scanning

electron microscope (SEM). Mineral grains that “light up” under different element scans are

mapped and then assayed by electron microprobe. The microprobe results are presented here.

Mineral grains that grow concurrently while touching or within diamonds have distinct chemistry

and are diagnostic of the presence diamonds and also of the rock type that host the diamonds at

great depths. Readers should note the following deep mantle, high-pressure rock types associated

with diamond mineralization that are noted in this release.

Lherzolite: Garnet, Clinopyroxene and Olivine (Certain types host >50carat diamonds).

Harzburgite: Garnet (low calcium, high chrome), Orthopyroxene and Olivine (Source of the

desirable “G10” garnets and ‘P’ type diamonds). Chromite: Harzburgite: A garnet poor,

Chromite rich variety of above. Eclogite: Garnet and Pyroxene (Source of ‘E’ Type diamonds).

The samples analyzed thus far are from the Sequoia kimberlite, hole DG-2021-04 located in the

geographical center of the complex. One sample from the interval 51m to 89m (5.1kg) from the

Coherent Kimberlite (“CK”), another sample from the interval 105m to 136m (5.1kg) logged as

Volcanoclastic Kimberlite transitional (“VKt”) into Coherent Kimberlite and a sample from the

interval 136m to 150m (5.3kg) logged as Volcanoclastic Kimberlite (“VK”).

Chuck Fipke reports: “The two Volcanoclastic samples are dominated by diamond inclusion

minerals (high calcium G10 garnets (classifying as G10-2 and G10-3) found in Lherzolite, (G11)

garnets and diamond inclusions (CP5) clinopyroxenes that have been found as inclusions in big

diamonds ranging from 52 to 102 carat from the Ekati diamond mine (coined "Di$") as well as

chromite rich harzburgite containing diamond inclusion chromites and orthopyroxenes. Current

research suggests these larger diamonds come from great depths >400km.

The diamond inclusion minerals from lherzolite (DI$, CP5 G9/G11 indicators mentioned above)

found in Sequoia is identical to those present in Letseng (In Lesotho), Victor (In Canada), and

Lucara’s Karowe Mine (Botswana). These kimberlites are typically lower grade but contain very

large high-quality diamonds routinely recovered during run-of-mine operations. This is based on

analysis of inclusions from over 335 diamonds from these sources as well as Ekati’s large

stones. The classification scheme relies on the multi-element analysis of the Sequoia indicator

minerals having the same chemical composition as the indicators from known large diamond

sources.

As well as passing through and sampling of lherzolite, the Sequoia kimberlite has sampled

diamond bearing chromite harzburgite as evidence by the abundant 99 diamond inclusion

composition chromites and 45 diamond inclusion orthopyroxenes present. These additional

mineralogies could account for any smaller diamonds recovered. The two Volcanoclastic

samples have relatively few eclogitic type garnets, which can also be associated with diamond

mineralization.

In contrast to the VK samples, the CK sample from 51 to 89 meters has abundant Group1

eclogitic garnets where the SEM shows 51 diamond inclusion eclogite grains. This sample also

has the large diamond inclusion llerzolite minerals and the subordinate diamond bearing (low

calcium-high chrome G10-7 and G10-9) pyrope garnet bearing harzburgite not present in the

VK as well as chromite harzburgite present in the VK. A total of 80 diamond inclusion

composition chromites and 10 diamond inclusion olivines were recovered from the chromite

harzburgite.

It is also worthy to note that the overall abundance of the lherzolite (DI$, CP5 G9/G11

indicators) large diamond inclusion minerals recovered from the three Sequoia DG 2021-04 drill

hole samples exceeds, per sample weight, that of any of the diamond bearing (lherzolitic)

kimberlites in the C.F. Minerals database. These results indicate that large diamonds should be

present if sufficiently large tonnages of this kimberlite are processed by methodology that

recovers large diamonds. The presence of abundant diamond inclusion chromites and

orthopyroxenes, as well as abundant diamond inclusion Group 1 eclogitic garnets, and

subordinate low calcium-high chrome G10 garnets and diamond inclusion olivines indicate

smaller potentially commercial diamonds may also be present.”

Table 1 – Caustic Fusion Results, Sequoia Kimberlite, Arctic Star

Drill

hole

0.105mm 0.15mm 0.212mm 0.3m

m

0.425m

m

0.6m

m

0.85m

m

Weig

ht

Kg

Total

stone

s

Stone

s/100

kg

Sequoi

a Total

146 54 11 7 4 2 0 292.6

0

224 76

Table 2 – Historic Caustic fusion Results, Jack Pine Kimberlite, Drilled by De Beers 1990s

Drill

hole

0.105mm 0.15mm 0.212mm 0.3m

m

0.425m

m

0.6m

m

0.85m

m

Weig

ht

Kg

Total

stone

s

Stone

s/100

kg

Jack

Pine

257 112 37 10 2 0 0 796.0

1

418 52

Figure 1 – Size Frequency plot: Diamond size distribution. Note Sequoia is Orange and Jack

Pine in Green. The Sequoia samples appear to have two populations of diamonds and clearly

have a higher frequency of larger diamonds than the Jack Pine sample. Figure 1 also depicts

possible trajectories for the Sequoia diamond distribution. For this small sample of less than

300kg, the spread of trajectories is large. Further caustic fusion samples would narrow down

this spread. It is desirable to have several commercial size stones from caustic fusion before

predicting grade and size distribution with great accuracy.

Dotted lines are projections.

Current results suggest a

1 carat stone every 5t - 100t,

More Caustic fusion results

will tighten this spread and

allow the design of a bulk

sample to demonstrate the

occurrence of large stones

Sequoia

Jack Pine

Commercial sized stones

Table 3 below shows the geology of drill hole DG 2021 04 and each individual rock type and

Caustic fusion diamond count for stones over 105 microns, illustrating the diamond count

differences, which will be reflected in the commercial grade. The next round of work will outline

the distribution of these rock types while continuing to make a more robust size frequency curve.

From To Interval Geology Diamond count

0m 28m 28m Overburden Not assayed

28m 51.29m 51.29m RVK 68/100 kg

51.29m 89.38m 37.95m CK 132/100kg

89.38m 101.26m 11.88m VKt 45/100kg

101.26 105.25m 3.99m CK 150/100kg

105.25m 123.49m 18.34m VKt 46/100kg

123.49m 154m 30.51m VK 56/100kg

The table demonstrates different kimberlite types have variable diamond counts. Volcanoclastic

rock types have significantly less diamonds than the coherent kimberlite rock type (Results are

from Caustic fusion SRC laboratories and an independent laboratory – see news release dated

July 6th 2021 for details).

Analysis of mineral indicator minerals from the other kimberlites is awaited. The rest of the

caustic fusion diamond results from the other kimberlite discoveries are expected before the end

of this week. The second round of Sequoia results where Arctic Star has sampled the other half

of drill holes DG 2021 04 and 05 should also be in, within the next few 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: "beli eve", "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 gu arantee 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 .