Stornoway Diamond Corporation
TSX : SWY

Stornoway Diamond Corporation

March 20, 2007 16:00 ET

Stornoway Diamond Corporation-$25 Million Bought Equity Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 20, 2007) -

NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

Stornoway Diamond Corporation ("Stornoway") (TSX:SWY) has today entered into an agreement with a group of underwriters co-led by BMO Capital Markets and Canaccord Adams under which the underwriters have agreed to buy 12,500,000 Units from Stornoway and sell to the public at a price of $1.20 per Unit, representing an aggregate issue amount of $15,000,000. Each Unit consists of one Common Share and one-half of one Common Share Purchase Warrant (the "Warrant"). Each whole Warrant entitles the holder to purchase one Common Share at a price of $1.50 on or before 24 months from closing. Stornoway has granted to the underwriters an over-allotment option to purchase an additional 1,875,000 Units at the same price, exercisable by the underwriters for a period of 30 days from closing.

In addition, Stornoway has agreed to sell through the Underwriters 6,670,000 Flow-Through Common Shares at a price of $1.50 per Flow-Through Common Share, representing an aggregate issue amount of $10,005,000.

Closing for the equity offerings is expected on or about April 11, 2007. Closing is subject to receipt of all required regulatory and third party approvals and consents, including the approval of the TSX.

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. 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.

Stornoway Diamond Corporation

Stornoway Diamond Corporation is one of Canada's leading diamond exploration and development companies. The Company and its affiliates have been responsible for discovering over 150 kimberlites and six new Canadian diamond districts. Stornoway's management and technical team has a proven track record in wealth creation for shareholders and direct operating experience in each segment of the diamond "pipeline" from exploration to marketing.

On behalf of the Board

STORNOWAY DIAMOND CORPORATION

Eira Thomas, Chief Executive Officer

This news release may contain forward looking statements, being statements which are not historical facts, including, without limitation, statements regarding potential mineralization, exploration results, resource or reserve estimates, anticipated production or results, sales, revenues, costs, "best-efforts" financings or discussions of future plans and objectives. There can be no assurance that such statements will prove accurate. Such statements are necessarily based upon a number of estimates and assumptions that are subject to numerous risks and uncertainties that could cause actual results and future events to differ materially from those anticipated or projected. Important factors that could cause actual results to differ materially from the Company's expectations are in Company documents filed from time to time with the Toronto Stock Exchange and provincial securities regulators, most of which are available at www.sedar.com. The Company disclaims any intention or obligation to revise or update such statements.

Contact Information