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Mountain Province Diamonds Announces Details Of Proposed Kennady Diamonds Spin-out

Stocks in this article: MDMMPV

Shares Issued and Outstanding: 80,345,558 TSX: MPV NYSE- AMEX: MDM

TORONTO AND NEW YORK, March 13, 2012 /PRNewswire/ - Mountain Province Diamonds Inc. ("Mountain Province", the "Company") (TSX: MPV, NYSE-AMEX: MDM) is pleased to announce further details on the proposed spin-out of the Company's 100 percent-controlled Kennady North diamond project into a newly-incorporated company Kennady Diamonds Inc. ("Kennady Diamonds").

The proposed spin-out will occur through a plan of arrangement (the "Arrangement") and will be subject to regulatory and court approval, as well as shareholder approval at a special meeting currently planned for April 25, 2012. The Company has taken steps, subject to court approval, to set the record date for notice of and voting at the special meeting as March 23, 2012.

Upon completion of the transfer of the Kennady North property and working capital in the amount of C$3M to Kennady Diamonds, Mountain Province intends to distribute 100 percent of the shares of Kennady Diamonds to Mountain Province shareholders on the basis of one Kennady Diamond share for every five shares of Mountain Province held by shareholders.

Patrick Evans, President and CEO, commented: "The proposed spin-out of Kennady North is intended to deliver greater value to Mountain Province shareholders by unlocking the value of this highly prospective diamond project. The transaction will also enable Mountain Province to focus on its flagship Gahcho Kué JV with De Beers while Kennady Diamonds focuses on advancing the 123 square-kilometer Kennady North Project."

****

About Kennady Diamonds The Kennady North project comprises thirteen leases and claims located to the west and north of the four leases controlled by the Gahcho Kué Joint Venture between De Beers Canada Inc. (51%) and Mountain Province (49%).

Exploration at Kennady North commenced in the late 1990's and resulted in the discovery of the diamondiferous Kelvin, Faraday and Hobbes kimberlites. The number of diamonds recovered from these kimberlites and the size-frequency distribution indicate that they may be of comparable grade to the 5034 (1.77 carats per tonne) and Hearne (2.10 carats per tonne) kimberlites at the Gahcho Kué JV. Exploration samples from Kelvin and Faraday returned a relatively large number of macro diamonds with the two largest being a 0.4 carat diamond from Faraday and a 0.09 carat diamond from Kelvin.

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