VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 8, 2012) -

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

Stornoway Diamond Corporation (TSX:SWY) ("Stornoway" or the "Company") is pleased to announce that it has entered into an agreement with Scotiabank (the "Underwriter") for a bought-deal financing of 15 million units (the "Units"). Each Unit will be priced at $1.00 and will be exercisable for one common share in the share capital of Stornoway (the "Shares") for no additional consideration plus one-half of a common share purchase warrant (the "Warrants"; collectively the "Offering"). Each whole Warrant shall entitle the holder thereof to acquire one Share at a price of $1.20 for a period of 24 months following closing of the Offering. Aggregate gross proceeds of the Offering will be $15 million, and the net proceeds of the Offering will be used for pre-development capital expenditures of the Renard Diamond Project and for general corporate purposes. Closing of the Offering is anticipated to occur on or about March 28, 2012 and is subject to the receipt of applicable regulatory approvals, including approval of the Toronto Stock Exchange ("TSX"). The Units issuable under the Offering may also be concurrently offered in the United States on a private placement basis pursuant to applicable exemptions from registration requirements.

The Company has granted the Underwriter an over-allotment option to purchase up to an additional 2,250,000 Units at the Offering price, exercisable in whole or in part at any time up to 30 days following closing of the Offering. In the event that this over-allotment option is exercised in its entirety, the aggregate gross proceeds of the Offering will be $17.25 million.

Stornoway is currently negotiating and anticipates concluding in the coming weeks a private placement of up to 10 million units, comprised of Shares and common share purchase warrants, which the Company currently intends to issue on substantially the same terms as the Units issued pursuant to the Offering. The private placement is anticipated to be concluded with a significant shareholder of Stornoway and one or more additional institutional investors. The completion of any such private placement will be subject to the conclusion of definitive documentation with such potential investors and receipt of all applicable regulatory approvals, including TSX approval.

The common shares referred to herein 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 offer, solicitation or sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

About the Renard Diamond Project

The Renard Diamond Project is located approximately 250 km north of the Cree community of Mistissini and 350 km north of Chibougamau in the James Bay region of North-Central Québec. In November 2011, Stornoway released the results of a feasibility study for Renard that highlighted the potential of the project to become a significant producer of high value rough diamonds over a long mine life. NI 43-101 compliant Probable Mineral Reserves stand at 18.0 million carats, with a further 17.5 million carats classified as Inferred Mineral Resources, and 23.5 to 48.5 million carats classified as non-resource exploration upside. All kimberlites remain open at depth. Pre-production capital cost stands at C$802 million, with a life of mine operating cost of C$54.71/tonne giving a 68% operating margin over an initial 11 year mine life. Production start-up is scheduled for 2015. Readers are referred to the technical report dated December 29, 2011 in respect of the Renard Diamond Project for further details and assumptions relating to the project.

About Stornoway Diamond Corporation

Stornoway is a leading Canadian diamond exploration and development company listed on the TSX under the symbol "SWY". Our flagship asset is the 100% owned Renard Diamond Project, on track to becoming Québec's first diamond mine. Stornoway also maintains an active diamond exploration program with both advanced and grassroots programs in the most prospective regions of Canada. Stornoway is a growth oriented company with a world class asset, in one of the world's best mining jurisdictions, in one of the world's great mining businesses.

On behalf of the Board