GREAT WESTERN DIAMONDS CORP.
TSX VENTURE : GWD

GREAT WESTERN DIAMONDS CORP.

October 06, 2005 12:28 ET

Great Western Diamonds Corp.: Press release

SASKATOON, SASKATCHEWAN--(CCNMatthews - Oct. 6, 2005) - Great Western
Diamonds Corp. (TSX VENTURE:GWD) ("GWD" or the"Corporation")
announced today the closing of its initial public offering (the
"Offering"). The Offering consisted of 3,900,000 flow-through units
(the "Flow-Through Units") of GWD at a price of $0.30 per Flow-
Through Unit, with each Flow-Through Unit being comprised of one
flow-through common share in the capital of GWD and one half of one
non-transferable common share purchase warrant (a "Warrant") of GWD,
and 5,800,000 common share units (the "Common Share Units", and
collectively with the Flow-Through Units, the "Units") of GWD at a
price of $0.25 per Common Share Unit, with each Common Share Unit
being comprised of one non flow-through common share (a "Common
Share") in the capital of GWD and one Warrant. Each whole Warrant
will entitle the holder thereof to purchase one additional Common
Share at a price of $0.35 per Common Share for a period of two (2)
years commencing from the date that the Common Shares are listed for
trading on the TSX Venture Exchange.

In connection with the Offering, the Corporation has granted to
Blackmont Capital Inc. (the "Agent") an option (the "Over-allotment
Option"), to purchase on the same terms as the Offering, up to that
number of Flow-Through Units and Common Share Units that is equal to
respectively 15% of the number of Flow-Through Units and Common Share
Units initially sold in the Offering. The Agent has exercised the
Over-allotment Option. As a result, a total of 4,485,000 Flow-Through
Units and 6,670,000 Common Share Units were sold for gross proceeds
of $3,013,000.

The Corporation will use $1,170,000 of the net proceeds to fund
exploration activities at its Candle Lake property and to fund
potential exploration opportunities in relation to other diamond
properties that may be acquired by the Corporation in the future. The
Corporation intends to use $705,224 of the net proceeds to repay
Great Western Minerals Group Ltd. ("GWMG") for costs and expenses
paid by GWMG on behalf of GWD in connection with the Candle Lake
property and Offering. The Corporation will use the remaining net
proceeds for general corporate purposes.

The Agent has received a cash commission equal to the aggregate of 8%
of the gross proceeds of the Offering (excluding proceeds realized
from the sale of certain units sold to RAB Special Solutions L.P.
(the "RAB Units")) and 4% of the gross proceeds realized from the
sale of the RAB Units. The Agent's commission has been paid out of
the proceeds of sales of Common Share Units. The Agent has been
granted a non-transferable option entitling the Agent to purchase,
for a period of twenty-four (24) months commencing from the date of
closing of the Offering at a price of $0.30 per Common Share, up to
such number of Common Shares that is equal to the aggregate of 12.5%
of the number
of Units (excluding the RAB Units) sold under the Offering and 6.25%
of the number of RAB Units sold under the Offering.

The TSX Venture Exchange has conditionally approved the listing of
GWD's Common Shares and the Company expects that trading will
commence on October 11, 2005 under the symbol "GWD".

The principal business of GWD is the acquisition, exploration and, if
warranted, development of diamondiferous kimberlite deposits. The
Corporation's principal assets are the claims comprising its interest
in the Candle Lake property.

The securities offered have not been registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold in
the United States absent registration or an applicable exemption from
the registration requirements. A prospectus related to these
securities has been filed with securities commissions or similar
authorities in each of Alberta, British Columbia and Saskatchewan.
This news release shall not constitute an offer to sell these
securities in any state of the United States or province or territory
of Canada.

(The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the foregoing contents)

Contact Information

  • Great Western Diamonds Corp.
    Gary Billingsley
    President, Chief Executive Officer
    (306) 668-0701
    or
    Great Western Diamonds Corp.
    Gord Dent
    (306) 668-0701
    Email: info@gwdc.ca
    Website: www.gwdc.ca