Peregrine Reports Maiden Inferred Mineral Resource Estimate for CH-7 Kimberlite at Chidliak Diamond Project

Peregrine Diamonds Ltd. ("Peregrine" or "the Company") is pleased to announce a maiden Inferred Mineral Resource estimate for the CH-7 kimberlite pipe at the Company's 100 percent owned Chidliak Diamond Project, Nunavut, Canada. Key elements of the announcement are:

• An Inferred Mineral Resource of 4.23 million carats of diamonds in 4.99 million tonnes of CH-7 kimberlite, to a depth of 240 metres
• Overall average grade of 0.85 carats per tonne
• A base model average diamond price of US$114 per carat with a modelled price range between US$94 and US$155 per carat as determined by WWW International Diamond Consultants ("WWW") in February 2016

Mr. Tom Peregoodoff, Peregrine's President and CEO said, "The resource we are announcing today is the culmination of the 2015 Diamond Resource Development Program at Chidliak. This program has successfully defined a significant Inferred Mineral Resource of over 15 million carats at Chidliak contained within the CH-6 and CH-7 kimberlites in the top 260 metres and 240 metres respectively and both which, importantly, remain open vertically at depth. This resource provides a firm foundation upon which the Preliminary Economic Assessment of a Phase 1 Diamond Mine will be developed. The Peregrine team have once again demonstrated the tremendous value of the Chidliak project and we all look forward to publishing the outcomes from this economic assessment when they become available next month."

CH-7 INFERRED MINERAL RESOURCE AND TFFE ESTIMATE

The CH-7 kimberlite was discovered in July 2009, has a surface area of approximately one hectare. CH-7 is located some 15 kilometres southeast of the CH-6 kimberlite for which the Company released an updated Inferred Mineral Resource estimate of 11.39 million carats of diamond in 4.46 million tonnes, with an average grade of 2.45 carats per tonne, in the top 260 metres on April 7th, 2016. The 2014 and 2015 resource development program for the CH-7 kimberlite was comprised of 1,968 metres of core drilling in 11 holes, 585 metres of narrow-diameter reverse-circulation ("RC") drilling in 36 surficial delineation holes, 1,212 metres of large-diameter RC drilling in six holes that extracted 814 dry tonnes of kimberlite, and the collection of 3,585 kg of microdiamond samples, together with requisite geological logging and data collection. Key results for the CH-7 pipe include diamond grades for large diameter drill samples (stated at a commercial grade bottom cut-off of 1.18 mm) ranging from 0.76 to 1.31 carats per tonne for major geological units (see January 12, 2016 news release), and a base model average diamond price of US$114 per carat, ranging up to a high model average price of US$155 per carat for 735.75 carats valued by WWW (see March 8, 2016 news release).

Mineral Services Canada Inc. ("Mineral Services"), who provided guidance on the 2015 resource development work at CH-7, recently completed a comprehensive review of all geological, microdiamond and bulk sampling results and have estimated a maiden Inferred Mineral Resource for the CH-7 kimberlite as provided in the following table.

NI 43-101 standards and Canadian Institute of Mining and Metallurgy guidelines stipulate that a Mineral Resource needs to have a "reasonable prospect of economic extraction". JDS Energy and Mining Inc. ("JDS") have created first-order Whittle open pits to 240 metre depth based on the CH-7 Inferred Resource and have integrated appropriate revenue models for the CH-7 kimberlite. JDS concludes that the CH-7 Inferred Mineral Resource satisfies the "reasonable prospect of economic extraction" criterion.

The Company announced an initial Target For Further Exploration ("TFFE") of 2.75 to 3.97 million tonnes for the CH-7 kimberlite on May 7th, 2014 that was updated to a TFFE range of 3.72 to 6.01 million tonnes on January 26th, 2015. The resource at CH-7 has converted a substantial portion of this TFFE to Inferred Mineral Resource. The TFFE now estimated for the CH-7 pipe between 240 and 320 metres depth below surface is tabulated below. The potential quantity of the TFFE is conceptual in nature. Insufficient exploration has been completed to delineate any portion of the CH-7 TFFE as a mineral resource and it is uncertain if further exploration will result in conversion of the TFFE to a mineral resource.

PRELIMINARY ECONOMIC ASSESSMENT

The Preliminary Economic Assessment of a Phase 1 Diamond Mine ("the PEA") based on the combined CH-6 and CH-7 Inferred Mineral Resource of 15.62 million carats contained in 9.63 million tonnes of kimberlite is being completed by JDS with input from SRK Consulting Canada on geotechnical, infrastructure and tailings management.

JDS is a specialized, private mineral engineering, consulting and construction company focused on adding value to mineral projects with fit-for-purpose designs and exceptional execution. The JDS team has a long history of northern Canadian and diamond experience including the current construction of the Gahcho Kue diamond mine and the Silvertip silver and base-metals mine.

The PEA is well advanced, and results are expected in late June, 2016 as previously announced.

QUALIFIED PERSONS

The CH-7 Inferred Mineral Resource estimate was prepared by Mineral Services Canada Inc. under the supervision of Dr Tom Nowicki. Dr. Nowicki is a Professional Geologist and an independent, external Qualified Person and a consultant to Peregrine. Mr. Dino Pilotto of JDS Energy and Mining Inc. is a Professional Engineer and an independent, external Qualified Person that consults to Peregrine.

Dr. Nowicki and Mr. Pilotto have reviewed this release and approve of its' contents.