Stornoway Completes $15 Million Financing


Stornoway Diamond Corporation ("Stornoway") is pleased to announce it has closed the financing underwritten by Canaccord Capital Corporation, with a syndicate of underwriters, including Haywood Securities Inc., BMO Nesbitt Burns Inc. and Raymond James Ltd. originally announced on August 5, 2003. The underwriters exercised their over-allotment option in full and, accordingly, $15,000,000 was raised for Stornoway.

Stornoway issued 7,999,999 Units each comprised of one common share and one half of one share purchase warrant. Each whole warrant is exercisable for one common share at a price of $1.75 per share until August 20, 2004. The underwriters completed the offering of Units at a price of $1.50 per unit for gross proceeds of $12 million. The underwriters received a 6.5% cash commission and were issued underwriters warrants to purchase 800,000 common shares in respect of the Unit offering. The underwriter's warrants are exercisable at a price of $1.55 per share up to August 20, 2004. In addition the syndicate of underwriters completed the sale of 1,999,999 flow through shares by way of private placement at a price of $1.50 per flow through share for gross proceeds of $3 million. The underwriters received a 3% cash commission for the flow through offering. All securities issued at closing are subject to a four month hold period, expiring December 21, 2003. The TSX Venture Exchange has issued conditional acceptance of this financing and final approval is pending.

After this financing, Stornoway has approximately $19.45 million in working capital. Proceeds of this financing will be used to fund the Company's diamond exploration projects in Nunavut, Northwest Territories and Quebec. Stornoway holds interests in more than 11 million acres of prospective diamond properties throughout northern Canada and will spend in excess of $8 million on exploration during 2003.

In 2003, Stornoway will rank as one of Canada's most active diamond explorers, with one of the largest property portfolios in the country. All exploration work is being carried out under the supervision of an experienced technical team that has a track record of discovery in the north. The Company will continue to focus its efforts largely in Nunavut, which remains underexplored and is geologically prospective for the discovery of world class primary diamond deposits.

On behalf of the Board
/s/ "Eira M Thomas"
Eira M Thomas, President

For further information, please contact the Company at 604-687-7545 or (888) 338-2200

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