Mineral Assessment Report 20070016

Assessment Report for the Legend Property, Birch Mountains, Northern Alberta

Authors: Dufresne, M.B., Carey, H., Raffle, K.

Executive Summary

APEX Geoscience Ltd. (APEX) was retained from 2006 to 2007, as consultants by Grizzly Diamonds Ltd. (Grizzly), to complete ground geophysical surveys and diamond- core drilling at the Legend Kimberlite at the Legend property in the Birch Mountain region of northeast Alberta. The Legend and Little Legend permits form the Legend property, which is approximately 430 km northeast of Edmonton. The Legend property is also approximately 175 km east of the Buffalo Head Hills kimberlite field and several other Grizzly properties. Grizzly's holdings in the Birch Mountains encompass 21 metallic mineral permits totalling approximately 110,080 hectares (272,008 acres) and cover all, or portions of, Township 94, Ranges 18, 19, 21, and 22; Township 95, Ranges 18, 19, 20, and 22; Township 96, Ranges 19 to 22 West of the 4th meridian. The Legend Property is within NTS 84H (84H/02 to 84H/07). Although diamond exploration on Grizzly's Birch Mountain permits is still in the early stages, the potential for discovery of additional diamondiferous kimberlites is considered high, based on the regional geological setting in conjunction with the positive results from exploration.

The regional setting in the Birch Mountain area is considered favourable for the presence of diamondiferous kimberlites. Grizzly's Legend property is along the western margin of the Proterozoic Taltson Magmatic Zone (TMZ) ,near the eastern extent of the Buffalo Head Terrane (BHT)

The Legend property encompasses seven of the nine kimberlites discovered between 1998 and 2001. Diamond exploration on the Legend property is still in the early stages due to limited DIM sampling and geophysical studies.

An aggressive, systematic follow-up exploration program in 2008, including diamond indicator mineral sampling, airborne magnetic-electromagnetic surveys, ground geophysical surveys, and drilling is warranted to search for additional diamondiferous kimberlites within Grizzly's Birch Mountain permits.