News Releases

December 28, 2005
Exploration Program Update And Private Placement
TORONTO, ONTARIO - Tsodilo Resources Limited ("Tsodilo") (TSX Venture Exchange: TSD) is pleased to report the results of their 2005 exploration campaign; to provide their conclusions and plans for exploration in 2006 in both their Newdico (Pty) Limited ("Newdico") and Gcwihaba Resources (Pty) Limited ("Gcwihaba') license blocks in Botswana; and to announce that it has negotiated a non-brokered private placement.

EXPLORATION PROGRAM UPDATE

NEWDICO (Pty) Limited

Summary of work completed in 2005


- Ground geophysical surveys, both magnetic and gravity, were completed over seven airborne magnetic anomalies.

- Follow-up kimberlitic indicator mineral ("KIM") sampling grids over two target anomalies were completed.

- Our geophysical consultants assessed the near-surface magnetic component of the airborne magnetic data in order to define paleo-drainage channels in the basement and Kalahari sequences. The results will direct drill investigation of these possible paleo-drainage channels in order to trace back secondary deposits of KIM and diamond to their source kimberlite(s).

- A Geographical Information System was initiated with all available geological, geophysical and geochemical data captured onto the system. The data is being used to prioritize target areas for further exploration.

- On July 1, 2005, an application for 18 prospecting license areas, totaling 16,800 square kilometers, was approved by the Minister of Mineral, Energy and Water Affairs effectively extending Newdico's tenancy until 2012.

- Our remote sensing consultant completed a first-pass interpretation of the various forms of satellite and radar imagery and has recommended priority areas for further investigation where the evidence suggests the alluvial G10 and diamond deposits at Tsumkwe and Omatako were sourced.

- Kimberlite indicator mineral sampling over and around two target areas, the Morama Anomaly and a portion of the satellite feature - Section Line 2, was completed.

- The planned drilling campaign for 2005 was affected by the drilling contractor's delay in arriving on site due to equipment problems and the lack of alternative drill rigs in southern Africa as a result of the high demand in the exploration sector for evaluation of water and mineral resource deposits. Three A15 evaluation holes were completed and sections of the A15 kimberlite samples were evaluated using petrography, the chemistry of indicator mineral grains and micro-diamond analysis.

- Although the A15 kimberlite has favorable chemistry and is comparable to other economic diamond deposits and the diamond preservation potential is high, the composite sample submitted for micro-diamond testing yielded no micro-diamonds.

It is well understood that even the most productive kimberlite clusters in the world contain a larger percentage of barren or low count kimberlites existing side by side with economic pipes. Not all deep-seated volcanic eruptions of kimberlite occur in a particular source area sufficiently rich in reduced carbon to form diamond even though previous work located diamondiferous kimberlites in close proximity to A15. The favorable chemistry and diamond preservation potential of the kimberlites in our license blocks together with the known secondary alluvial diamond discoveries down slope across the border in Namibia establish the greater Nxau Nxau field as highly prospective with the possibility of several economic kimberlites present within our ground. For a complete overview of the A15 kimberlite mineral chemistry see /s/MineralChemistry.asp.

President and CEO James M. Bruchs comments: "Not all kimberlites with favorable chemistry are diamondiferous. In the Orapa kimberlite cluster for example, 4 of the approximately 50 kimberlites are economic while the balance have low or barren diamond counts. A15 is proximate (2 -- 8 kilometers) to four previously discovered diamondiferous kimberlites with less favorable chemistry and is the first kimberlite of this type to be tested for micro-diamonds. To date, at least 18% of the kimberlites discovered in the Nxau Nxau field are known to be diamondiferous. Our target selection is and remains focused and we look forward to drill testing and analysis of further selected anomalies in the Nxau Nxau field once the rains have ceased. C15 and A41 are just two of the multiple priority kimberlite targets to be drilled in the next few months and their geophysical signature can be viewed on our website at: /s/Imagery.asp. We remain on track to locating the source of the alluvial G10 and diamond deposits at Tsumkwe and Omatako."

Planned Exploration Program for 2006

The program is based on our strategy of using a combination of indicator mineral sampling, magnetic and gravity data to generate individual targets for drill evaluation and our regional strategy of evaluating possible transport corridors giving rise to the alluvial secondary KIM and diamond deposits at Tsumkwe and Omatako. Our program for 2006 will include the following:

- Extend the 2x2 kilometer KIM sampling grid for 24 kilometers to the south of the Nxau Nxau kimberlite field to cover the western 40 kilometers of the Okavango Dyke Swarm. This will involve the collection and processing of some 240 deflation soil samples.

- Prepare drill access roads and collect KIM samples along two 17 kilometer sections across interpreted paleo-drainage channel transport corridors.

- Perform a trial airborne survey over the western portion of the dyke swarm using low-level flying, close-spaced survey lines and gradiometer array magnetometers to distinguish dolerite from kimberlite magnetic responses.

- Drill evaluation of the 16 high-priority targets in the Guma District.

- Drill evaluation of the 4 high-priority targets in the Nxau-Nxau kimberlite field.

- Drill evaluation of transport corridor sections.

- Drill evaluation of any high-priority airborne test survey magnetic anomaly targets.

- If time allows, drill evaluation of 18 second-priority targets in the Nxau-Nxau kimberlite field.


GCWIHABA RESOURCES (Pty) Limited

Diamond Licenses

Summary of work completed in 2005


- A large ground geophysical survey grid, using both magnetic & gravity over the 2021 A7 airborne magnetic anomaly was completed.

- As with our Newdico licenses, our geophysical consultants assessed the near-surface magnetic component of the airborne magnetic data in order to define paleo-drainage channels in the basement and Kalahari sequences. The results will be used to direct drill investigation of these possible paleo-drainage channels in order to trace back secondary deposits of KIM and diamond to their source kimberlite(s).

- During the year our Geographical Information System was initiated with all available geological, geophysical and geochemical data for these licenses captured onto the system. The data is being used to prioritize target areas for further exploration.

- Our remote sensing consultant extended his first-pass interpretation of the various forms of satellite and radar imagery into the Gcwihaba licenses and has recommended priority areas for further investigation where the evidence suggests the alluvial KIM and diamond deposits at Tsumkwe and Omatako could have been sourced.


Planned Exploration Program for 2006

- Drill evaluation of Anomaly 2021 A7 is a high priority.


Base and Precious Metals Licenses

Summary of work completed in 2005

- Four new base and precious metal licenses were granted to the Company on October 1, 2005, and encompass an area of some 3,780 square kilometers and are for an initial period of three years, renewable for two two-year periods.

- The licenses were selected based on the results of a 1999 government geochemical soil sampling program, released and partially reported on in November 2001.

- One of the Nickel anomalies, named the Morama Anomaly has been checked with a total of 15 soil samples collected for multi-element analysis -- results are pending.

Planned Exploration Program for 2006

- There are several zones of co-incident base metal anomalies that require follow-up sampling as a first step in the evaluation process. A Chalcophyle Index is currently in preparation to assist in the prioritization of these zones.

- Exploratory drilling of suspected base metal deposits to determine their nature, composition and size.


PRIVATE PLACEMENT

The Company is pleased to announce that it has negotiated a non-brokered private placement of 468,776 shares units of the Company (the "Units") at a price of $1.25 per Unit for proceeds to the Company of $585,970. Each Unit consists of one common share of the Company and one warrant of the Company, each full such warrant entitling the holder to purchase one common share of the Company at a price of $1.00 for a period of two years. Closing of this transaction is subject to regulatory approval. Proceeds from this financing will be added to the Company's working capital.

Tsodilo Resources is an international diamond exploration company engaged in the search for economic kimberlites at its Newdico and Gcwihaba projects in northwest Botswana. The Republic of Botswana is the largest producer of diamonds, by value, in the world. Tsodilo has an 81% stake in Newdico (16,800 sq. km under license) while Trans Hex Group, a South African diamond mining and marketing company, holds the remaining 19%. The southern Gcwihaba project area (6,703 sq. km under diamond license and 3,780 sq. km under base and precious metals licenses) is 100% held by Tsodilo subsidiary Gcwihaba Resources (Pty) Limited. Tsodilo manages the exploration of both the Newdico and Gcwihaba license areas. The design and conduct of the Company's exploration program is the responsibility of Peter Walker, a qualified professional geologist registered with the South African Council for Natural Scientific Professions. Please visit the website, www.TsodiloResources.com, for additional information and background on our projects.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release. This news release may contain assumptions, estimates, and other forward-looking statements regarding future events. Such forward-looking statements involve inherent risks and uncertainties and are subject to factors, many of which are beyond the Company's control, which may cause actual results or performance to differ materially from those currently anticipated in such statements.


FOR FURTHER INFORMATION PLEASE CONTACT:

James M. Bruchs - President and Chief Executive Officer
E-Mail: JBruchs@TsodiloResources.com

Head Office:
Telephone +1 416 572 2033
Facsimile + 1 416 572 4164
COREBOX
Tsodilo Resources Limited
Canada Trust Tower, BCE Place
161 Bay Street, P.O. Box 508
Toronto, ON Canada M5J 2S1
Telephone: (416) 572-2033
Fax: (416) 987-4369
Website: www.TsodiloResources.com/
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