By James Kwantes, World of Mining

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Photographs of select diamonds recovered from the 2013 CH-6 bulk sample (Peregrine)

Eric Friedland’s Peregrine Diamonds released news this morning that moved the stock 52%, to 64 cents, by the time markets closed.

A 222-dry-tonne bulk sample from the company’s CH-6 kimberlite returned an impressive grade of 2.7 carats per tonne and 48 diamonds larger than 1 carat, including a 3.54-carat stone. CH-6 is the flagship kimberlite at Peregrine’s 100%-owned Chidliak project on Baffin Island. CH-6 is one of at least 7 kimberlite pipes at Chidliak that the company bills as potentially economic.

Here’s a photo gallery of the gems.

The sample is described by Peregrine’s qualified person Howard Coopersmith as a “very white and clean diamond population with excellent shapes,” which bodes well for the valuation expected to be complete in the first quarter of 2014. That valuation will include diamonds from the entire 404-dry-tonne CH-6 bulk sample. Results from the rest of the sample are expected in January.

Peregrine chairman and CEO Eric Friedland

Peregrine chairman and CEO Eric Friedland

It’s not the highest-grade recent diamond discovery – on Nov. 18, Kennady Diamonds announced a sample grade of 5.37 carats per tonne from a 1,500-kg sample at its Kennady North project near Mountain Province Diamonds’ Gahcho Kue joint venture with De Beers. Shares of Kennady Diamonds, spun off from Mountain Province last year, have risen 400% in the past year.

But Peregrine’s CH-6 sample size is equivalent to more than 200,000 kg – many multiples of Kennady’s early-stage sample – making the results more significant. That allows the company – with a rhetorical flourish worthy of a Friedland – to bill the grade as “higher than that of any of the kimberlite pipes currently under advanced exploration or development in Canada.” The grade is surpassed only by five pipes at the Ekati and Diavik diamond mines in the Northwest Territories.

Peregrine’s grade claim includes, of course, Gahcho Kue, which is described on Mountain Province’s website as “the world’s largest and richest new diamond mine.” Gahcho Kue, which today cleared another hurdle with the Mackenzie Valley Land and Water Board, is a joint venture with 60% owner De Beers, which walked away from Chidliak earlier this year, sending the stock skidding lower.

The De Beers farewell followed the exit of Peregrine’s former joint venture partner BHP Billiton. Significantly, both mining giants expended capital and expertise furthering Chidliak before their respective exits. In the case of BHP, part of the divorce included ceding to Peregrine the company’s entire northern Canadian diamond exploration database, compiled over a 10-year period.

Upcoming catalysts for Peregrine include results from the remainder of the bulk sample and diamond valuation of the gems recovered on Baffin Island. Eric owns 14% of outstanding shares and his older brother Robert Friedland is Peregrine’s largest individual shareholder, with a 15% stake that he last added to in June by participating in a private placement at 35 cents a share.

The elder Friedland, the mining tycoon and conference showman, has an interview with Rick Rule tomorrow at the Mines and Money London conference. I wonder if he’ll mention his brother’s Canadian diamond project, which was considerably de-risked by today’s news.

Disclosure: I own Peregrine Diamonds shares, which can be volatile. Please read my disclaimer.

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Diamond partners Peregrine, De Beers no longer dancing | World of Mining