SouthernEra Diamonds Closes BHP Billiton Private Placement

SouthernEra Diamonds Inc. today announced the conclusion of the previously announced private placement with BHP Billiton. The company has issued a total of 15,684,000 shares at a price of C$0.60 per share for gross proceeds of $8 million. BHPB has now become SouthernEra's largest shareholder with an approximate 12 percent holding.

SouthernEra said $4 million of the $8 million proceeds will be used to fund the exploration for primary diamonds and all other minerals within SouthernEra's exploration permits, which cover in excess of 13,000 square kilometers of ground in the Democratic Republic of the Congo (DRC).

BHP can earn a 50 percent or a maximum 65 percent interest in the joint venture. Once the $4 million has been fully utilized, BHP will fully fund exploration up to and including the completion of a pre-feasibility study and will earn a 50 percent interest in the project. Full funding of a Bankable Feasibility study will grant BHP an additional 15 percent interest.

SouthernEra will retain a 100 percent right to all alluvial diamonds. The remaining US$4 million will be used to support SouthernEra's global exploration and development program and for general corporate purposes.

SouthernEra Diamonds is one of Canada's largest fully integrated diamond companies with extensive advanced diamond exploration in five countries including Canada, Gabon, the DRC, Zimbabwe and South Africa. The Company also operates the Klipspringer Diamond Mine in South Africa and maintains an18 percent free-carried interest in the Camafuca Diamond Project in Angola.