TORONTO, ONTARIO - Shear Diamonds Ltd. (TSX VENTURE:SRM) today announces the recovery of the first 200 carats of diamonds from trial tests performed in the recently restarted recovery portion of Shear's 100% owned Jericho Diamond Mine, Nunavut. In addition Shear has completed a new geological interpretation and 3- D Model for the Jericho Kimberlite Complex.

"The recoveries are an important part of proving Jericho's real potential, and speaks to the lost grade from past operations. We are excited to see that the diamond recoveries from the recovery rejects tailings pile are in line with audits done by both Tahera and Shear (refer to press release dated Februrary 8, 2011)" says Julie Lassonde, CEO and Chair of Shear. "Diamond recoveries continue during our plant trial, which has seen periodic stoppages to address the inevitable issues which arise in recommissioning a circuit that has been dormant for the past three years. Shear's ultimate goal is to generate cash flow from diamond sales in the coming months and continuing through all of 2012."

The diamond recoveries total 200.85 carats from 22.1 wet tonnes of recovery reject and coarse processed kimberlite. 14 stones greater than 0.5 cts have been recovered and the four largest stones are 1.907, 0.978, 0.974, and 0.775 cts respectively.

The diamond recovery process includes on site processing of material through a crusher, sorted and fed through the WHIMS, then an X-ray flow sort and grease table followed by on site manual diamond recovery and sorting. Shear is reporting total diamond recoveries since the material being processed has already been run through the plant during past operations is not representative of the overall diamond count of the Jericho Kimberlite Complex as stated in the resource.

(Marketwire - Oct. 6, 2011)