Mountain Province Diamonds Announces Second Quarter 2022 Production and Sales Results Featuring Second Highest Quarterly Revenue in Company History

Press Release

TORONTO and NEW YORK, July 11, 2022 – Mountain Province Diamonds Inc. (“Mountain Province”, the “Company”) (TSX: MPVD) (OTCQX: MPVD) today announces production and sales results for the second quarter ended June 30, 2022 (“the Quarter” or “Q2 2022”) from the Gahcho Kué Diamond Mine (“GK Mine”). All figures are expressed in Canadian dollars unless otherwise noted. Additionally, the Company is providing updated FY 2022 production guidance which reflects a slower-than-planned ramp up following Covid-19 and process facility-related difficulties in Q1/22. These challenges are being addressed and significant improvements in dilution management, processed grade and process plant availability have been achieved throughout June 2022, and leading into Q3/22.

Q2 Sales Highlights

• 16% Increase in Carats Sold. The Company sold 586,763 carats in Q2 2022, a 16% increase relative to Q1 2022.
• 2^nd Highest Quarterly Revenue. Total proceeds of US$76M representing the second highest quarterly revenue in the Company’s history and a 14% increase relative to that achieved in Q1 2022.
• Positive Price Environment. The strong average value per carat of US$130 follows closely to the unprecedented price growth during the Q1/22. The rough diamond market continues to experience strong demand supported by solid US retail results. Further support to the market is anticipated from jewellery retail in China as Covid restrictions ease in that country.

Mark Wall, the Company’s President and Chief Executive Officer, commented:

“Production during the quarter improved from Q1 and reached our daily targets over the past month.  The action plan that has been developed to drive operational improvements is working, however efforts to recover from the lower production throughout Q1 were slower than anticipated, and as such it is appropriate to provide updated production and cost guidance to the market. Despite this, I am pleased to see the diamond market continues to remain strong, with our second highest revenue in history achieved in Q2. With this improved financial position, we continue to remain on track with our refinancing and strategic objectives.”

Q2 Production Takeaways

• 749,821 ore tonnes treated, an 8% decrease relative to Q2 2021, and a 6% increase relative to Q1 2022 (Q2 2021: 811,171 tonnes treated; Q1 2022, 707,553 tonnes treated)
• 1,260,899 carats recovered, 29% lower than Q2 2021, and a 6% increase relative to Q1 2022 (Q2 2021: 1,763,556 carats recovered, Q1 2022: 1,185,156 carats recovered)
• Average grade of 1.68 carats per tonne, a 23% decrease relative to Q2 2021, and unchanged relative to Q2/22 (Q2 2021: 2.17 carats per tonne, Q1 2022: 1.68 carats per tonne)

Revised Operating and Cost Guidance for 2022 (all figures quoted on a 100% basis)

Challenges in Q1 related to a Covid outbreak, process plant availability and higher than planned external dilution continued into the second quarter, leading to lower than expected production. These are progressively being remedied heading into H2/22, evidenced by production of 502,778 carats in June 2022, a 26% increase relative to May 2022. Action plans to ensure these issues do not occur in the future are in place, and leading to improvements in process plant availability and processed grade, which are being tracked closely by management. With the impact of Q2 performance on full year expected numbers, it is appropriate to issue revised production and cost guidance for the 2022 operating year to the market. The Company expects:

• 34 – 38 million total tonnes mined (ore and waste)
  • Previously 35 – 40 million total tonnes mined (ore and waste)
• 3.75 – 4.30 million ore tonnes mined
  • Unchanged
• 3.00 – 3.20 million ore tonnes treated
  • Previously 3.35 – 3.60 million ore tonnes treated
• 5.6 – 5.8 million carats recovered
  • Previously 6.2 – 6.4 million carats recovered
• Production costs of $140 – $146 per tonne treated
  • Previously $131 – $137 per tonne treated
• Production costs of $76 – $80 per carat recovered
  • $71 – $76 per carat recovered
• Sustaining Capital Expenditure of $11 million
  • Unchanged

The increase in cost guidance is directly related to fewer tonnes treated and carats recovered relative to previous expectations. The operation has not seen significant gross cost increases over-and-above those reflected in previous cost guidance.

About Mountain Province Diamonds Inc.

Mountain Province Diamonds is a 49% participant with De Beers Canada in the Gahcho Kué diamond mine located in Canada’s Northwest Territories. The Gahcho Kué Joint Venture property consists of several kimberlites that are actively being mined, developed, and explored for future development. The Company also controls 107,373 hectares of highly prospective mineral claims and leases surrounding the Gahcho Kué Mine that include an Indicated mineral resource for the Kelvin kimberlite and Inferred mineral resources for the Faraday kimberlites. Kelvin is estimated to contain 13.62 million carats (Mct) in 8.50 million tonnes (Mt) at a grade of 1.60 carats/tonne and value of US$63/carat. Faraday 2 is estimated to contain 5.45Mct in 2.07Mt at a grade of 2.63 carats/tonne and value of US$140/ct. Faraday 1-3 is estimated to contain 1.90Mct in 1.87Mt at a grade of 1.04 carats/tonne and value of US$75/carat. All resource estimations are based on a 1mm diamond size bottom cut-off.

For further information on Mountain Province Diamonds and to receive news releases by email, visit the Company’s website at www.mountainprovince.com.

For further information: Mark Wall, President and CEO, (416) 361-3562, [email protected]; Matthew MacPhail, Chief Technical Officer, (416) 361-3562, [email protected]; Investor Contact: Rich Matthews, Partner, Integrous Communications, [email protected], (604) 757 7179, www.integcom.us

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