Mr. Patrick Power of Arctic Star Exploration reports

ARCTIC STAR COMMENCES DRILLING DIAGRAS DIAMOND PROJECT LAC DE GRAS, NWT CANADA

Arctic Star Exploration Corp. has commenced drilling on the Diagras diamond project located in the diamond corridor of the prolific Lac de Gras kimberlite field, 22 kilometres north-northeast of the Diavik diamond mine and 36 km east of the Ekati diamond mine in Northwest Territories. Arctic Star's Diagras project contains 23 kimberlites previously discovered by DeBeers.

Highlights:

• $2-million financing completed for drilling;
• Arctic assumes operator of joint venture;
• Diamond drilling 10 to 15 targets.

Project management

The Diagras diamond project was originally a 60-40 joint venture between Margaret Lake Diamonds Inc. and Arctic Star, respectfully. Margaret Lake has recently undergone management changes and has shifted its focus elsewhere. In 2019, Margaret Lake informed Arctic Star that it had no exploration plans for Diagras.

The joint venture agreement allows for Arctic Star to take over management in such a situation by proposing and executing a plan and budget. Arctic Star proposed a $2.1-million budget for the Diagras project in 2021. Margaret Lake has informed Arctic Star that it will not to participate. In such a case, the JV agreement has a dilution formula. At the time Arctic Star expends the proposed 2021 budget, the ownership will change to approximately 77 per cent Arctic Star and 23 per cent Margaret Lake. Arctic Star will continue as the operator. If Margaret Lake dilutes below 10 per cent in the future, the company's interest converts to a 1.5-per-cent gross overriding royalty.

Diamond drill program commences

Arctic Star has commissioned Aurora Geoscience to be the operator of the Diagras drilling and geophysics program. Aurora is a Yellowknife-based group and is able to operate without travel restrictions in the Northwest Territories. David Kelsch will be responsible for the day-to-day management of Aurora. Mr. Kelsch has over 30 years of experience, predominantly in diamond exploration, and has been involved in a number of discoveries. Mr. Kelsch has been managing the geophysical programs that led to the development of the drill targets on the Diagras property over the past years. Mr. Kelsch has been working closely with Buddy Doyle, the company's exploration manager.

Any kimberlite intercepted in the drill program will be flown to Yellowknife for detailed logging and sampling by Aurora staff who are familiar with kimberlites. Aurora managed exploration programs for Mountain Province and Dominion Diamonds, and have been in diamond exploration in the territories since the 1990s. Samples will be sent to Chuck Fipke's lab, CF Laboratories of Kelowna, where they will be reviewed by Mr. Kelsch and Mr. Doyle prior to undergoing analysis for diamonds for caustic fusion.

Qualified person

The qualified person for this news release is Mr. Doyle, AUSIMM, a geologist with over 30 years of experience in diamond exploration, discovery and evaluation. He is a qualified person under the provisions of National Instrument 43-101.

About Arctic Star Exploration Corp.

Arctic Star has commenced exploration in Lac de Gras, NWT, on its Diagras diamond project next to the producing Diavik and Ekati diamond mines. The company also owns 100 per cent of the Timantti diamond project including a 243-hectare exploration permit and a 193,700-hectare exploration reservation near the town of Kuusamo, Finland. The project is located approximately 550 kilometres southwest of the operating Grib diamond mine in Russia. The company also controls drill-ready diamond exploration properties in Nunavut (Stein).

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