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Jaibaras Diamond Project Drilling and Bulk Sampling Completed

Exploration Programs

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TSX-V STAR

Market Release

29 August 2017

FIVE STAR DIAMONDS

LIMITED

Av. Jornalista Ricardo Marinho, 360

Ed. Cosmopolitan - Sala 113,

CEP 22631-350

Barra da Tijuca - Rio de Janeiro

Brazil

Tel: +55 8 9200 6264

Contact:

Joe Burke, GM Marketing

[email protected]

Rajan “Raj” Rai

[email protected]

+1 778 835 9200

Directors / Officers:

Matthew Wood

Luis Azevedo

Brian McMaster

Gizman Abbas

Simon Rothschild

Nicholas Pike

TSXV: STAR

JAIBARAS DIAMOND PROJECT

DRILLING AND BULK SAMPLING

COMPLETED

Toronto, ON - Five Star Diamonds Limited (TSXV: STAR) (the “Company”

or “Five Star Diamonds”) is very pleased to advise that it has successfully

completed its diamond drilling and bulk sampling programmes at its

100% owned Jaibaras Diamond Project (the “Jaibaras Project” or “the

Project”) in Para State, Brazil.

Highlights

Ø An initial programme totalling 1,536m of diamond

drilling for 49 holes was completed on the J1, J2 and J4

kimberlite pipes.

Ø A total of 23 mini-bulk samples will be collected from

the drilling programme that successfully intersected

kimberlite rock. These samples which will only contain

the full saprolite zones of the core will be submitted to

South Africa for caustic fusion and diamond analysis.

Ø Additional bulk sampling has also been concluded on

four kimberlite pipes, J1, J2, J3 and J4. A total of 120

tonnes of material has been processed through the

company’s jig concentrate plant at the Project.

Ø 1,110 kgs of concentrate is being transported to the

Catalao diamond recovery plant for processing across

the X-Ray flow sort.

Ø Bulk sampling results are expected over the coming

weeks.

Ø In addition 6 smaller bulk samples of approximately 1

tonne each were collected from pipes J1, J2 and J4.

These samples are currently in storage and will also be

submitted to South Africa for caustic fusion and

diamond analysis.

Ø The Company expects that the completion of the above

programme will determine an early stage approximate

value, grade and tonnage for the J1, J2 and J4 Kimberlite

pipes.

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JAIBARAS DIAMOND PROJECT, PARA STATE

The Company has recently successfully completed its initial diamond drilling and bulk

sampling programmes at the Jaibaras Diamond Project.

Drilling Programme

Diamond core drilling focused on the J1, J2 and J4 kimberlite pipes. A total of 25 drill

holes were completed at the J1 kimberlite pipe, 18 drill holes completed at the J2

kimberlite pipe and six drill holes at the J4 kimberlite pipe.

Drilling at Jaibaras Diamond Project

The key objective of the drill programme was to cross cut the clay weathered zone and

penetrate approximately five metres into the fresh rock. This will now allow the

Company to delineate the lateral boundaries of each pipe and the vertical depth extent of

the clay weathered zone. It has allowed the Company to now possess the relevant

information required to conduct a tonnage estimation of the clay weathered zones.

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25 vertical diamond drill holes were completed totalling 766.65 metres.

11 holes successfully intersected kimberlite at the J1 kimberlite pipe.

18 vertical diamond drill holes were completed totalling 577.30 metres.

8 holes successfully intersected kimberlite at the J2 kimberlite pipe.

HOLE_ID METERS

DRILLED

KIMBERLITE

INTERVALS (m) % KIMB.

JAI-DDH-001-17 25.25 0.00 0.0

JAI-DDH-002-17 29.45 0.00 0.0

JAI-DDH-003-17 35.50 35.19 99.1

JAI-DDH-004-17 32.05 31.39 97.9

JAI-DDH-005-17 34.40 3.78 11.0

JAI-DDH-006-17 35.00 34.44 98.4

JAI-DDH-007-17 35.10 35.10 100.0

JAI-DDH-008-17 30.50 0.00 0.0

JAI-DDH-009-17 27.05 27.05 100.0

JAI-DDH-010-17 29.40 19.16 65.2

JAI-DDH-011-17 30.75 29.69 96.6

JAI-DDH-012-17 31.75 30.42 95.8

JAI-DDH-013-17 30.70 0.00 0.0

JAI-DDH-014-17 33.10 0.00 0.0

JAI-DDH-015-17 31.00 0.00 0.0

JAI-DDH-016-17 27.60 0.00 0.0

JAI-DDH-017-17 30.25 0.00 0.0

JAI-DDH-018-17 40.00 39.67 99.2

JAI-DDH-019-17 34.70 34.32 98.9

JAI-DDH-020-17 30.00 0.00 0.0

JAI-DDH-039-17 30.00 0.00 0.0

JAI-DDH-040-17 24.05 0.00 0.0

JAI-DDH-041-17 29.05 0.00 0.0

JAI-DDH-042-17 30.00 0.00 0.0

JAI-DDH-043-17 30.00 0.00 0.0

TOTAL: 776.65 320.21 41.2

J1 KIMBERLITE

HOLE_ID METERS

DRILLED

KIMBERLITE

INTERVALS (m) % KIMB.

JAI-DDH-021-17 30.30 0.00 0.0

JAI-DDH-022-17 30.25 28.25 93.4

JAI-DDH-023-17 35.75 28.94 81.0

JAI-DDH-024-17 49.50 31.95 64.5

JAI-DDH-025-17 29.60 1.31 4.4

JAI-DDH-026-17 34.95 33.65 96.3

JAI-DDH-027-17 31.85 30.11 94.5

JAI-DDH-028-17 30.95 0.00 0.0

JAI-DDH-029-17 30.70 0.00 0.0

JAI-DDH-030-17 31.05 30.31 97.6

JAI-DDH-031-17 42.00 3.08 7.3

JAI-DDH-032-17 35.45 0.00 0.0

JAI-DDH-033-17 13.80 0.00 0.0

JAI-DDH-034-17 30.00 0.00 0.0

JAI-DDH-035-17 30.55 0.00 0.0

JAI-DDH-036-17 30.05 0.00 0.0

JAI-DDH-037-17 30.45 0.00 0.0

JAI-DDH-038-17 30.10 0.00 0.0

TOTAL: 577.30 187.60 32.5

J2 KIMBERLITE

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6 vertical diamond drill holes were completed totalling 183.60 metres.

4 holes successfully intersected kimberlite at the J4 kimberlite pipe.

Location of diamond core drilling on ground magnetics – J1 Kimberlite Pipe

Location of diamond core drilling on ground magnetics - J2 Kimberlite Pip

HOLE_ID METERS

DRILLED

KIMBERLITE

INTERVALS (m) % KIMB.

JAI-DDH-044-17 38.45 31.64 82.3

JAI-DDH-045-17 25.40 5.20 20.5

JAI-DDH-046-17 38.15 37.25 97.6

JAI-DDH-047-17 25.20 7.66 30.4

JAI-DDH-048-17 30.05 0.00 0.0

JAI-DDH-049-17 26.35 0.00 0.0

TOTAL: 183.60 81.75 44.5

J4 KIMBERLITE

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Location of diamond core drilling on ground magnetics – J4 Kimberlite Pipe

Bulk Sampling Programme

A total of eight bulk samples were collected from the drilling programme. Two samples

each from J1 Kimberlite Pipe, J2 Kimberlite Pipe, J3 Kimberlite Pipe and J4 Kimberlite

Pipe were collected totalling approximately 120 tonnes.

The 0.5tph bulk sampling jig plant at Jaibaras has completed processing these eight

samples and a total of 1,110 kg of concentrate has been prepared for shipment to the

Company’s diamond recovery plant in Catalao City where it will be processed across the

X-Ray Flow Sort.

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Collecting Mini Bulk Sampling of the Kimberlite Pipes at Jaibaras Diamond Project

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Bulk Sampling Plant at Jaibaras

Concentrate currently under transport to the diamond recovery plant in Catalao for processing

A total of 23 mini-bulk samples will be collected from the drilling programme that

successfully intersected kimberlite rock. These samples which will only contain the full

saprolite zones of the core, ignoring the overburden at the top and the fresh rock at the

bottom will be submitted to South Africa for caustic fusion and diamond analysis. Once

collected this will assist the Company in creating a tonnage estimate on the pipes drilled.

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Previous mini bulk sampling of the J1 and J2 kimberlite pipes undertaken last year

resulted in the recovery of gem quality macro diamonds from clay weathered kimberlite.

The concentrate processed from the eight samples is currently being transported to the

Company’s Diamond Recovery Plant in Catalao City for diamond recovery.

Diamonds previously recovered from the mini-bulk sampling of J1 and J2 kimberlite pipes