True North Gems Announces Positive Update to Aappaluttoq Pre-Feasibility Study

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Feb 25, 2015) - True North Gems Inc. (TSX VENTURE:TGX) ("True North" or the "Company") is pleased to announce the results of the updated pre-feasibility study ("PFS") on the Aappaluttoq Ruby and Pink Sapphire Project in Southwest Greenland. True North contracted Tetra Tech of Vancouver as independent engineers to review the project and complete the update.

Key financial and project highlights of the Aappaluttoq PFS are as follows:

Key financial and project highlights of the Aappaluttoq PFS for True North Gems are as follows:

"The Company is extremely pleased with the completion of this pre-feasibility study and the strong economic findings. It confirms our long-held confidence in the Aappaluttoq Project and its potential to be developed successfully into long term sustainable profitable operation delivering lasting benefits to the people of Greenland our shareholders and the international gemstone markets." stated Nicholas Houghton, President and CEO of True North Gems.

Resources and Reserves:

The current resource for the Aappaluttoq Deposit was issued on 1^st June, 2011. No further in-ground geological development work has occurred since then, thus the resource is still current and actively utilized within the updated pre-feasibility study. The tables below summarize the Mineral Resources and probable open-pit Mineral Reserves for the Aappaluttoq Project. The Mineral Reserves account for the anticipated mining recovery and dilution and a lower cut-off size of 1.7mm, which is utilized throughout the resource and plant design. Mineral Resources are reported inclusive of Mineral Reserves.

Aappaluttoq Mineral Resources

Aappaluttoq Probable Open Pit Mineral Reserves

Capital and Operating Cost:

The primary capital development cost for the project including initial and sustaining has been estimated at US$25 million which includes construction of the project port, roads, helipads, mine camp, security, processing facility and workshop. This represents a significant reduction of approximately US$15 million over the 2011 Prefeasibility study that has been accomplished by utilizing a Greenlandic partner experienced in arctic construction, as well as designing a corundum recovery plant with a lower capital requirement, and contributing EPCM within the Company's experienced Nuuk operations team. As part of the LNS-Greenland joint venture agreement (see news releases: 13^th August 2013 and 11^th September 2014) the majority of the capital costs will be assumed by LNS-Greenland in exchange for a final earn of 27% ownership of True North Gems Greenland A/S (TNGG), the subsidiary of True North Gem Inc. The Company is expected to contribute US$8 million of the total capital expenditure; these expenses include the processing plant equipment, Nuuk HF secondary cleaning facility, corporate in-country headquarters and the gem sorting and grading facility. The operating expenditure includes negotiated fixed lease payments to LNS-Greenland for certain site buildings and other estimated costs using quotes provided by LNS-Greenland and verified by TetraTech.

The LNS joint venture will provide all mining and service equipment for the mining project this equipment includes; three haul trucks, three excavators, three front end loaders and various service and small vehicles that will be leased over the current life of mine.

Mining and Corundum Recovery:

The study contemplates the development of an open pit mine to extract the probable Mineral Resources using conventional mining equipment. The mined ore will be transported to an adjacent process facility where it will be concentrated using an iterative crushing, dense media separation and optical sorting circuit to extract a rough corundum concentrate. This initial rough concentrates will be shipped to a secondary processing facility for the removal of any remaining rock matrix prior to ruby and pink sapphire grading. A lower cut-off size in the design has been established at 1.7 mm, which is nominally larger than the minimum size of gemstone rough supplied for commercial polishing.

Ruby and Pink Sapphire Rough Values:

The ruby and pink sapphire values were recently completed using the average offer to purchase submitted by independent international buyers of coloured gemstones after viewing the various categories of rough material. In addition, GemWorld completed their own independent evaluation of polished ruby and pink sapphire pricing across all categories as a window on the polished market. The Company is expected to primarily sell rough but a certain component of polished will also be sold and is incorporated into the financial analysis. No value has been attributed for the recovery of any opaque non-gem material. All valuation information was reviewed by Tetra Tech to ensure it was properly incorporated into the financial analysis.

Other opportunities include:

• Upgrade of inferred resources to indicated: The resource estimate identifies 77,200 tonnes of inferred resource with a grade of 283 grams per tonne of total clean corundum. In accordance with NI 43-101 standards 66,000 tonnes of the inferred resource falls within the designed pit shell but is not included as ore in the study.
• Increasing mine life and/or throughput: The deposit remains open along strike in both directions and to depth, indicating potential for increased throughput and/or a longer life operation. The processing plant is designed for additional capacity.
• Development of nearby targets-for-further-exploration which host gem corundum at surface and lie within 10km of the Aappaluttoq site - including Siggartartulik and Kigutilik both of which are within the Companys licence area.

The Company will issue the final technical report quoted in this release for the Aappaluttoq ruby project within 45 days as required by NI 43-101, this will update the previous technical report filed on 1 June, 2011. TetraTech relied on information provided by several other contributors including:

• Novus Engineering of Vancouver: Process plant engineering and metallurgical testing;
• GemWorld International of Chicago: Ruby and Sapphire market analysis;
• Independent and confidential valuations of rough ruby and pink sapphire;
• LNS Group of Norway: Construction costs, Greenland logistics and Operating estimates;
• Rambøll of Denmark: environmental baseline studies, monitoring and Environmental Impact Assessment;
• Grontmij of Denmark: Socioeconomic impact assessment;
• InuPlan A/S of Nuuk: Mine environmental monitoring program and extended EIA baseline study;

In accordance with NI 43-101, Mark Horan, P.Eng. and Lara Reggin, P.Geo. of TetraTech-EBA are the independent Qualified Persons responsible for the technical information in this news release. Mr. Horan and Ms. Reggin have reviewed this release and approved its contents.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This document contains "forward-looking information" and "forward-looking statements" (together, "forward-looking statements") within the meaning of applicable securities legislation, which are made as of the date of this document or the document(s) referred to herein. Statements that express predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects", "anticipates", "plans", "projects", "estimates", "intends", "strategy", "goals", "objectives" or variations thereof or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements. Forward-looking statements include, without limitation, statements with respect to: the amount of mineral reserves and mineral resources; the amount of future production over any period; net present value and internal rates of return of the proposed mining operation; capital costs; operating costs; strip ratios and mining rates; and mine life. The forward-looking statements are made based upon certain assumptions which, if untrue, could cause the actual results, performances or achievements of the Company to be materially different from future results, performances or achievements expressed or implied by the forward-looking statements.

These assumptions include, without limitation: the price of gemstone products produced; anticipated costs; the presence of and continuity of gemstones at modeled grades and values; the capacities of various machinery and equipment; the availability of personnel, machinery and equipment at estimated prices; exchange rates; appropriate discount rates; tax rates applicable to the proposed mining operation; financing structure and costs; anticipated mining losses and dilution; gemstone recovery rates; reasonable contingency requirements; and receipt of regulatory approvals on acceptable terms. By their very nature, forward-looking statements involve inherent risks and uncertainties that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements. These include, without limitation: price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks, regulatory restrictions (including environmental regulatory restrictions and liability), activities by governmental authorities (including changes in taxation), currency fluctuations, the speculative nature of gemstone exploration, the global economic climate, dilution, share price volatility, competition, loss of key employees; additional funding requirements and defective title to mineral claims or property]. This list is not exhaustive. See also, for example, the risks disclosed in the Company's other disclosure documents filed at www.sedar.com, including, without limitation, those disclosed in the Company's management's discussion & analysis. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements, except as otherwise required by applicable securities legislation.