Mountain Province Announces Completion of Arrangement with Kennady Diamonds

Shares Issued and Outstanding: 80,715,558

TSX: MPV

NYSE MKT: MDM

TORONTO AND NEW YORK, July 10, 2012 /PRNewswire/ - Mountain Province Diamonds Inc. (TSX: MPV) (NYSE MKT: MDM) (“Mountain
Province” or the “Company”) announced today that it has completed the
previously announced plan of arrangement (the “Arrangement”) on July 6,
2012, the effective date of the Arrangement, pursuant to which Mountain
Province transferred the Kennady North property to Kennady Diamonds
Inc. (“Kennady Diamonds”).

Upon completion of the transfer of the Kennady North property and
working capital of C$3M to Kennady Diamonds in exchange for 16,143,111
shares of Kennady Diamonds, Mountain Province distributed the shares of
Kennady Diamonds to Mountain Province shareholders on the basis of one
Kennady Diamonds’ share for every five shares of Mountain Province held
by shareholders. The Arrangement is described in detail in the
Company’s information circular dated March 29, 2012, (the “Circular”),
and any capitalized terms otherwise not defined in this news release
shall have the meaning as set out in the Circular.

Shareholders entitled to receive Kennady Diamonds shares will receive
evidence of the electronic registration of ownership of the Kennady
Diamonds shares under the Direct Registration System adopted by the
Transfer Agent, as soon as practicable following the Effective Date.

Mountain Province shareholders voted in favour of the special resolution
on April 25, 2012, approving the Arrangement.  The Court issued a final
order approving the Arrangement on April 30, 2012.  The Arrangement
also received conditional approval of the Toronto Stock Exchange on May
25, 2012.  The TSX Venture Exchange conditionally approved the listing
of the Kennady Diamonds shares on June 8, 2012.  Kennady Diamonds has
been listed on the TSX Venture Exchange under the symbol KDI, and
begins trading July 10, 2012.

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Mountain Province Diamonds is a 49% participant with De Beers Canada in the Gahcho Kué JV located
at Kennady Lake in Canada’s Northwest Territories. The Gahcho Kué
Project consists of a cluster of four diamondiferous kimberlites, three
of which have a probable mineral reserve of 31.3 million tonnes grading
1.57 carats per tonne for total diamond content of 49 million carats.

Gahcho Kué is the world’s largest and highest grade new diamond
development project. A December 2010 feasibility study filed by
Mountain Province (available on SEDAR) indicates that the Gahcho Kué
project has an IRR of 33.9%.

Qualified Person

This news release has been prepared under the supervision of Carl G.
Verley, P.Geo., who serves as the qualified person under National
Instrument 43-101.

FORWARD LOOKING INFORMATION

This news release includes certain information that may constitute
“forward-looking information” under applicable Canadian securities
legislation. Forward-looking information includes, but is not limited
to, the Company’s strategic plans,  future operations, future work
programs and objectives. Forward-looking information is necessarily
based upon a number of estimates and assumptions that, while considered
reasonable, are subject to known and unknown risks, uncertainties, and
other factors which may cause the actual results and future events to
differ materially from those expressed or implied by such
forward-looking information. There can be no assurance that such
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
information. Accordingly, readers should not place undue reliance on
forward-looking information. All forward-looking information contained
in this press release is given as of the date hereof and is based upon
the opinions and estimates of management and information available to
management as at the date hereof. The Company disclaims any intention
or obligation to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise,
except as required by law.

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

SOURCE Mountain Province Diamonds Inc.