Canabrava Diamond Corporation: Five New Kimberlites Discovered On Victoria Island.

Business Editors

VANCOUVER, British Columbia--(BUSINESS WIRE)--Aug. 22, 2002

Canabrava Diamond Corporation (TSX VENTURE:CNB) is pleased to announce that drilling of 1100 metres core in 13 drill holes has resulted in the discovery of five new kimberlites and several extensive new kimberlite phases around a previously known pipe on the Hadley Bay Project, Victoria Island.

Two recently completed drill holes intersected substantial kimberlite at the King Eider pipe. Previously considered to be a small pipe, detailed ground magnetic surveying outlined a large magnetic anomaly measuring 200 by 300 metres in size.

The -50 degree angled, easterly trending drill hole designed to intersect three of the magnetic signatures encountered 108 metres of kimberlite from 6 to 126 metres, including two 6 metre wide limestone bodies which may be large xenoliths. As the hole collared in kimberlite bedrock, the drill was turned in the opposite direction to test for the extent of the kimberlite in the westerly direction. This hole, also drilled at -50 degrees, encountered a further 19 metres of kimberlite. Both holes terminated in country rock limestone.

Initial field description describes the unit as coarsely crystalline, olivine and phlogopite rich macrocrystic kimberlite, likely of diatreme facies. Both purple and orange garnets up to 6 mm in size are present and become more abundant with depth.

In another area, the completely new Apollo cluster includes the drilled Apollo, Diana, Neptune and Pluto kimberlite pipes. These four closely spaced kimberlites have strong magnetic signatures and are part of a group of 10 separate magnetic anomalies situated along a 1.5 kilometre long northwesterly structural trend. The four drilled kimberlites are considered representative of the Apollo cluster and the other six targets will be drill tested if significant diamond results are returned.

The new Juno kimberlite dyke was intersected by two shallow drill holes on a new linear magnetic anomaly in a highly prospective area. The Juno dyke is about one metre wide and its discovery has identified yet another northwesterly trending kimberlite structure along which, elsewhere on Victoria Island, kimberlite pipes have been identified. A search along strike of this trend for larger bodies is underway.

As almost all core will be processed for microdiamonds, a consulting petrologist is now on site to undertake detailed study of the 350 metres of kimberlite drilled on the Hadley Bay Project. The petrologist will classify kimberlites, collect samples for indicator minerals and microscopic study, and nominate kimberlite intervals for microdiamond recovery via caustic fusion.

A geophysical survey crew is expected to arrive on site shortly to undertake helicopter-borne magnetic surveys. A substantial block of ground with high kimberlite potential will be flown in detail and approximately 30 of the recently staked isolated anomalies will be surveyed individually.

Eleven of the thirteen drill holes on the Hadley Bay intersected kimberlite. Drilling is currently on a break while the geophysical survey is underway and will resume in about 10 days to test the best of the recently developed targets remaining.

Canabrava Diamond Corporation has the option to earn a 50% interest in the Hadley Bay Project, Nunavut, from Diamonds North Resources Ltd. Canabrava is actively exploring for diamonds in Canada and Brazil both independently and through major joint ventures with Diamonds North Resources Ltd., Kennecott Canada Exploration Inc., Navigator Exploration Corp., and Paramount Ventures and Finance Inc. The Company is 39.1% owned by Southwestern Resources Corp.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.