January 4, 2006 TORONTO, ONTARIO - Tsodilo Resources Limited ("Tsodilo") (TSX Venture Exchange: TSD) reports that in terms of the Stock Option Plan of the Company and a policy adopted by the board of directors in September 2002, 85,000 stock options were granted to officers and senior employees on January 3, 2006 at $1.25 per common share. These options are valid for five years and vest in four equal installments on January 3, 2006, July 3, 2006, January 3, 2007 and July 3, 2007.

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