Properties

Alberta

BUFFALO HILLS PROPERTY

SIZE

Approximately 763,763 acres comprising 50 Metallic and Industrial Mineral Permits and 22 Metallic and Industrial Mineral Leases covering 12,612 acres.

OWNERSHIP

Canterra 28.5% / Shore Gold 28.5% / Encana Corporation 43%. Canterra is the Operator of the Project.

ASSETS

To date, a total of 38 kimberlites have been discovered in the region, of which 26 are diamondiferous. Kimberlite bodies range in size from 1 - 47 hectares.

OVERVIEW

In July 2007, Diamondex Resources Ltd., the predecessor company to Canterra, and Shore Gold purchased the Buffalo Hills property from Stornoway Diamonds Corporation. Pursuant to the acquisition, Canterra and Shore each acquired 22.5% interest in the Buffalo Hills Joint Venture, in which Encana Corporation held a 43% interest and Pure Diamonds Exploration Inc. held the remaining 12% interest. Canterra and Shore had an option whereby the companies could increase their combined interest to 72.5% by spending $15 million prior to April 30, 2010. A subsequent restructuring of the Joint Venture Agreement resulted in the interest apportionment as to Canterra 28.5%, Shore Gold 28.5% and Encana Corporation 43%.

To date, 6 kimberlites have been mini-bulk sampled ranging between 1 and 479 tonnes. In 1997 and 1998, a cumulative 524 tonne sample collected from K14 returned an estimated diamond content of 12 carats per hundred tonnes ("cpht") with the largest diamond recovered weighing 1.3 carats. A 36 tonne sample collected from K91 in 1988 returned an estimated diamond content of 13 cpht with the largest diamond weighing 0.45 carats.

The K14, K91 and BH225 kimberlites are located within a broad corridor approximately two kilometres in length. Based on the limited existing drill data, these three kimberlites, taken together, have the potential to host significant kimberlite tonnage.

The K6 kimberlite is located approximately 10 km south of K14 and is interpreted to have a northern and a southern vent and the potential for significant tonnage. A cumulative 19.2 tonne sample collected from the northern vent in 1997 and 2002 returned an estimated diamond content of 7.2 cpht, resulted in the recovery of a 0.76 carat fancy yellow diamond.
The K252 kimberlite has returned a grade of 55 cpht from a 22.8 tonne sample.

EXPLORATION 2007

During the first quarter of 2007, and prior to the acquisition of an interest in the Buffalo Hills property by Canterra and Shore, Stornoway Diamond Corporation collected a bulk sample from the K14 and K6 kimberlites.

Results of the bulk samples are as follows:

Batch	Dry Metric Tonnes	Total Stones	Total Carats	CPHT	Largest Stone (ct)
BHH-K14-Pit-1	43.56	45	3.20885	7.37	0.9
BHH-K14-Pit-2	45.22	70	3.97460	8.79	0.38
BHH-K14-Pit-3	48.22	24	3.94695	8.18	0.71
BHH-K6-Pit-1	231.89	85	16.2853	7.02	1.07
Total	368.89	224	27.416

EXPLORATION 2008

The winter exploration program for the Buffalo Hills Project began in late February 2008. The primary goal of the program was to drill test the best kimberlite bodies discovered to date with sufficient density to allow for the identification of distinct kimberlite phases and key characteristics that would permit the construction of accurate geological models. The purpose of the exploration program was to provide vital information to determine which kimberlites would warrant bulk sampling during follow-up campaigns. Following the completion of the 2008 exploration programs, a total of 41 drill holes were completed on kimberlites K14, K252, and K6 for a combined total of 6,818 metres. All drill core was transferred to the Shore logging facility in Fort a la Corne, Saskatchewan, where it was subjected to quantitative geological analysis.

EXPLORATION 2011

During the 2010 winter exploration program, 13 core drill holes were completed at kimberlites K5, K6, and K91, for a total of 1510 metres. The goal of the drilling program was to collect further data to enable the BHJV to develop meaningful models and calculations of the size and shape of the kimberlite bodies.