Arctic Star Expands Nickel Discovery at Credit Lake, Providence Lake Greenstone Belt, NT

VANCOUVER, BRITISH COLUMBIA–(EMWNews – Aug. 13, 2008) – Arctic Star Diamond Corp. (TSX VENTURE:ADD) (“Arctic Star” or the “Company”) reports assays, 1.68% nickel, 0.99% copper, 0.17% cobalt, 0.34 ppm platinum, and 2.23 ppm palladium from 1.65 metres of massive sulphides. These are the first results received from its ongoing drilling program from a new nickel discovery on its 100% owned Credit Lake property, in the Northwest Territories (NT). Massive sulphide in lenses up to 5.1m thick have now been intersected in 7 of the 9 holes completed in this program. Disseminated sulphide zones also exist in all holes drill to date.

In April 2008, Arctic Star discovered disseminated, stringer and massive sulphides with significant nickel, copper and cobalt values. In mid-July Arctic Star returned to Credit Lake to continue exploration on this new discovery. Exploration underway includes prospecting, soil sampling, geological mapping, geophysics and diamond drilling. Drilling has followed a 30m vertical and horizontal step out protocol in the discovery area. Arctic has now nine drill holes into this program and they are successfully defining the shape and extent of this komatiite and amphibolite hosted nickel mineralization.

The results reported today from the first diamond drill hole (DDH) in the current drill program, DDH 08CR-11 which intersected matrix and massive sulphide 30m below the same intercept reported in the first hole, DDH 08CR-10 (see News Releases May 27 and June 4, 2008). Mineralized komatiitic lavas occur from 127.7m to 152.4m in DDH 08CR-11. Within the komatiite, a lense of 1.65m of massive sulphides, occurs between 139.75m and 141.4m, it was this interval that was rushed to the lab. The massive sulphide results from both holes are reported below in table 1.

The rush assay results from DDH 08CR-11 confirm the nickel, copper cobalt results of the first hole continue at depth and of particular note the assays confirm the mineralization contains platinum and palladium. Table 1 lists the massive sulphide assays received to date.

Table 1:- RUSH ORE-GRADE ASSAY RESULTS: - see note below table

--------------------------------------------------------------------------
                                inter-                       Plati-  Palla-
          Az/Dip    from     to   val  Copper Nickel Cobalt    num    dium
Hole #   Degrees      (m)    (m)   (m)      %      %      %    ppm     ppm
--------------------------------------------------------------------------
O8CR-10  180/-45   117.6  117.8   0.2    2.92   1.34  0.125 assays awaited
                   118.2  118.8   0.6    0.46   1.77  0.164 assays awaited
08CR-11  190/-45  139.75  141.4  1.65    0.99   1.68  0.170   0.34    2.23
--------------------------------------------------------------------------
Samples from DDH 08CR-10 (BTW split core) were sent to ALS Chemex 
laboratory in Thunder Bay, Ontario; Samples from DDH 08CR-11 (BQTW split 
core) were sent to SRC Laboratories in Saskatoon, Saskatchewan. At both 
laboratories the split core was crushed and pulverized and then assayed
using aqua-regia or 3-acid digestion with atomic absorption spectrometry 
finish. Fire Assay was used to determine Platinum and Palladium.

Surface mapping near the discovery has revealed that the nickel sequence outcrops in the area. Interestingly these outcropping sulphides had been trenched and sampled by other workers in the past, possibly for gold or VMS, but not for nickel. The mapping shows the sequence is striking at 100 degrees E-W and dipping to the north at 70 degrees. The drill orientation has been adjusted to intersect these rocks perpendicular to strike. Table 2 lists each hole drilled to date and states where komatiite and amphibolite hosted disseminated and massive sulphide have been intersected. To date massive sulphide has been drill confirmed over 100m of strike and 120m (vertical) depth. The drilling in part is designed to determine the dip and plunge of the sulphides and until this work is completed it is not yet possible to calculate true widths. If the sulphides continue to dip at 70 degrees the current drill hole intercepts will be estimating true widths to within 7%. An Innov-X x-ray fluorescence Mobilab device is being used to confirm the presence of elevated nickel, copper and cobalt to guide drilling. Each mineralized drill core interval is sawed in two, then systematically sampled and sent to laboratory for assay. Pulps collected while sawing drill core will be used in Arctic Star’s quality control and quality assurance program.

Table 2:- Mineralized Komatiite, Amphibolite, and Massive Sulphide 
intercepts

--------------------------------------------------------------------------
                                               Inter-
           Az/Dip    Depth   From       To       val   MS Intervals
Hole #    Degrees       (m)    (m)      (m)       (m)  (m)
--------------------------------------------------------------------------
08CR-10   180/-45    142.3     102   134.7      32.7   0.2, 0.6 (2 lenses)
O8CR-11   190/-45      177   141.4   152.4      11.0   1.65
08CR-12   190/-45   143.24   91.44    99.7      8.26   1.48
08CR-13   190/-55    159.4    97.0   105.2       8.2   1.05, 1.25, 1.00 
                                                       (3 lenses)
08CR-14   190/-45   181.34  146.55  154.65       8.1   0.3
08CR-15   190/-45    176.7  135.65  141.45       5.8   0.01
08CR-16   190/-45     91.4                             not intersected
08CR-17   190/-45    112.7    97.4    99.7       2.3   (Amphibolite hosted)
08CR-18   190/-52      137    98.4   103.5       5.1   (Amphibolite hosted)

Note MS equals massive sulphides

This discovery is the first insitu occurrence of nickel mineralization reported in the Slave geological province, with grades that suggest the Providence Lake Greenstone (PLG) Belt has the potential to produce economic nickel mineralization. The PLG belt includes large volumes of mafic and ultramafic rocks, and includes tholeiitic basalts, komatiites, serpentinized peridotite, and gabbro intrusions. The PLG belt features deep-penetrating faults, sulphur-bearing sediments in the form of sulphide bearing iron-formation and black shales, and massive sulphides. Arctic Star geologists believe this discovery is only the first in an extensive land package with similar geology and airborne geophysical anomalies.

Arctic Star Diamond Corp, controls 37km of the PLG belt in two 100% owned projects: Credit Lake and New Bigg.

The qualified persons for this news release are Mr. K. R. Kivi, P.Geol., and Mr. B. Doyle as defined by National Instrument 43-101.

On Behalf of the Board of Directors

Arctic Star Diamond Corp.

Patrick Power, President and CEO

This news release contains Forward Looking Statements regarding our intentions and plans. Various factors may prevent or delay our plans, including but not limited to, contractor availability and performance, weather, access, mineral prices and success and failure of the exploration and development carried out at various stages of the program. Readers should review risk factors applicable to junior mining exploration companies generally to understand the variety of risks that can affect the Company.

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