SOURCE: Sao Luis Mining, Inc.

January 08, 2007 07:00 ET

Sao Luis Mining's Bulk Samplings From Its Brazilian Property 117 Produces 673 Carats of Diamonds Including Gem Stones Over 2 Carats

LAS VEGAS, NV -- (MARKET WIRE) -- January 8, 2007 -- Sao Luis Mining, Inc., (PINKSHEETS: SAOL) a diamond mining and precious metals exploration company, reports that the bulk samplings of diamond bearing alluvial gravels on its joint venture property 117 has produced 673 carats of diamonds, including gem quality diamonds exceeding 2 carats. Property 117 is located in the Sao Luis River Basin in the state of Mato Grosso, which is Brazil's most productive diamond producing region.

The initial alluvial gravel samples from Sao Luis Mining's test pits all produced significant numbers of diamonds, including three gem quality stones over two carats. Fifty percent of the diamonds recovered from this sampling averaged over half a carat per stone, and the grade has reached 0.648 carats per cubic meter in one test area. This is considered a very high concentration of coarse diamonds. It is also expected that as work progresses towards the "stone line" the grade will continue to increase.

The latest samplings on Property 117 were taken from three test areas. The first was 72 cubic meters of gravels processed that produced 41.25 carats of diamonds with an average grade of 0.57 carats per cubic meter. The second 202 cubic meter area resulted in 70.75 carats of diamonds with a grade of 0.35 carats per cubic meter. The third area totaled 233 cubic meters of gravels that resulted in the recovery of 151.00 carats with an increased grade of 0.648 carats per cubic meter. The three largest gem quality diamonds recovered weighed 2.79 carats, 2.33 carats, and 2.19 carats.

The Company will continue its ongoing evaluation of Property 117. This includes the ongoing drilling program to delineate the diamond bearing gravels, the analysis of the latest satellite reports, and continued bulk sampling.

A second field processing plant will be installed in late January to assist in the evaluation of the property and help determine where to begin production mining. In late March a pilot processing plant with a 40 ton per hour capacity will be delivered to start production mining. This new processing plant has the capacity to produce over 5,000 carats per month. Once it has proved to be efficient, at least one additional processing plant with 100 ton per hour capacity will be ordered, which could increase the production capacity to 15,000 carats per month.

These results are expected to mirror those on the Company's Joint Venture Property 231, located adjacent to Property 117. A geological report submitted to Brazil's Department of National Mineral Production (DNPM) in 2005 defined a surface resource of 12,695,000 carats with an average grade of 1.645 carats per cubic meter. At present market prices this resource could be conservatively valued at approximately $300,000,000. The geological report does not take into account the material contained in three primary sources located at lower depths that may exponentially increase Sao Luis Mining's known resources.

About Sao Luis Mining:

Sao Luis Mining, Inc. is a diamond mining and precious metals exploration company. Its strategy is to acquire interests in producing mines and develop properties that have the promise to be economically viable. Sao Luis Mining has a 51% joint venture interest in Comercio e Mineracao Sao Luis Ltda., which operates two diamond properties and an existing processing plant in the Sao Luis River Basin. The operation is located in the state of Mato Grosso, which is the most productive diamond district in Brazil and responsible for 61% of all the legally mined diamonds in Brazil in 2005. Additional information, including a photo gallery and geological report, is available at the Company's website www.saolmining.com.

Forward-Looking Statements:

This news release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. When used in this release, words such as "estimate," "expect," "anticipate," "projected," "planned," forecasted" and similar expressions are intended to identify forward-looking statements, which are, by their very nature, not guarantees of Sao Luis Mining, Inc.'s future operational or financial performance, and are subject to risks and uncertainties. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. Due to the risks and uncertainties, actual events may differ materially from current expectations. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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