Stornoway Closes Flow-Through Share Financing


Stornoway Diamond Corporation (TSX-SWY) has today announced that it has closed two offerings to raise an aggregate of $4,175,000 from the issuance of 3,340,000 flow-through shares.

In one offering, first announced on November 14th, Canaccord Adams and BMO Capital Markets (the "Underwriters") agreed to buy or to find purchasers of 3,200,000 flow-through common shares of Stornoway on a private placement basis at a price of $1.25 per flow-through common share for gross proceeds of $4,000,000. The Underwriters were paid a cash fee in the amount of 6% of gross proceeds and were issued 192,000 broker warrants, each broker warrant entitling the holder to acquire one common share of Stornoway (a "Warrant Share") at a price of $1.25 per share up to November 29, 2008. 

In the second offering, five investors have agreed to purchase, on a non-brokered private placement basis, 140,000 flow-through shares at a purchase price of $1.25 per share for gross proceeds of $175,000. 

All flow-through shares issued in the offerings, the broker warrants and the Warrant Shares are subject to hold periods expiring on March 30, 2007.

The flow through funds will be used for exploration expenditures which constitute Canadian Exploration Expenses as defined in the Income Tax Act. 

This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful. The securities have not been registered under the United States Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

On behalf of the Board

/s/ "Eira Thomas"
Eira Thomas, President