TORONTO, ONTARIO - Tsodilo Resources Limited (TSX Venture Exchange: TSD) is pleased to report on the drilling results for the geophysical target designated A37. This is the third target to be investigated in the recent drilling program.

A 37
The accompanying figure shows the 2nd Order Gravity residual for the geophysical target designated A37. Defined in this figure is a major elongated gravity "low" orientated west-northwest -- east-southeast. A subsidiary gravity low immediately to the east is interpreted to be related to this feature. The overall negative gravity anomaly is associated with a number of prominent bulls-eye magnetic anomalies and several more subtle positive magnetic features. Five holes were drilled on an approximately west-northwest -- east-southeast line, some 1,600 metres in length, to investigate the A37 geophysical target. The position of these holes (numbered 1 thru 5) is shown on the gravity plot. All five holes intersected a very similar sequence of layered rocks beneath relatively thin (less than 47 metres) Kalahari cover, comprising upper shales and coarser and often fragmental lower units. In the light of these results, a further hole (number 6) was drilled into a subsidiary gravity "low" located to the north of the original line of drill holes. This intersected a sedimentary sequence closely similar to that in the original five holes.

All of the material selected for mineralogical analysis proved to be highly altered. However, fragments of kimberlite were identified in one of the holes (number 2) on the basis of their petrographic and chemical characteristics. Clay-rich material, which superficially resembles altered olivine, is present in the other holes, although positive identification is precluded by the extreme alteration. Although no heavy mineral results are available at this stage, a mauve garnet, presumed to be peridotitic, was identified in one of the small chips selected for microscopic analysis.

The overall character of the sub-Kalahari sediments (fragmental rocks overlain by finer-grained material) is broadly comparable to many kimberlite crater infill sequences. The presence of weathered kimberlite fragments in one of the holes, and material resembling altered olivine in others also suggests that holes 1-6 intersected a kimberlite crater sequence. Chemical analysis of the sediments indicates that Ni and Nb concentrations show a sharp increase compared to the Kalahari section, although are low relative to many other kimberlite crater sequences. While further work is required to confirm the nature of the sedimentary sequence, the preliminary petrographic examination indicates that quartz grains, together with a carbonate cement, probably derived from disaggregated country rock dolomites, form a major proportion of the rock chips studied. This could account for the low Ni and Nb contents. Our preliminary interpretation of the drilling results is therefore that the sub-Kalahari sediments represent the infill to a kimberlite crater.

All of the holes terminated in bedrock dolomites, indicating that the inferred crater is comparable in morphology to the "champagne-glass" intrusions that characterize many of the Australian diamond pipes. The latter have been interpreted to reflect phreatic eruptions -- i.e. those formed when the hot magma vaporized water in surface sediments. Dolomites, such as those forming the country rocks to A37, are likely to have cavities filled with groundwater. A hot magma reacting with such large volumes of water could therefore in principle account for massive eruptions, and excavation of the basin that was subsequently filled by a mixture of ejected kimberlitic and wallrock material. The carbonate cement recognized in the samples studied would most likely be derived from pulverized wallrocks.

It is estimated, on the basis of the gravity data, that the inferred crater sediments will have a north-south extent of 500 to 600 metres. The drilling results, coupled with the gravity data therefore indicate a major body of crater sediments covering an overall area of at least 80 to 100 hectares. While further drilling will be required to delineate this body with greater accuracy, our preliminary interpretation of the results suggest that in terms of surface area, A37 could be the second or third largest kimberlite discovered in the Republic of Botswana to date. The Republic of Botswana is the largest producer of diamonds, by value, in the world.

Tsodilo Resources considers these results most encouraging. The Ngamiland exploration programme was designed to locate the source of kimberlitic indicator mineral ("KIM") anomalies to the west of the Ngamiland property, in Namibia. An in-house geomorphological model (see www.tsodiloresources.com for further details) indicates that diamondiferous kimberlites in our Ngamiland and/or Gcwihaba Prospecting Licences could be the source of these unexplained KIM anomalies. In previous reports it has been noted that these unexplained KIM anomalies point to the existence of a source very different from the known kimberlites in northwest Botswana and northeast Namibia -- all of which are small and apparently low grade or barren.

The large A37 anomaly not only differs from the known kimberlites in terms of its large size, but appears to represent a local focus of kimberlite activity with multiple feeders; which is typical of many of the world's known economic pipes. Many of the world's richest kimberlites appear to have been formed as a result of phreatic eruptions. Such high grades may in part be related to rapid cooling of the kimberlite and preservation of diamonds at the time of eruption.

Available magnetic data indicates the presence of a number of further closely associated clusters of magnetic bulls-eye targets elsewhere within our Ngamiland and Gcwihaba licences, which may represent local focuses of kimberlite volcanic activity. Gravity surveys are planned to establish whether these may also represent previously unrecognized major kimberlite bodies.

Previously, it was reported that kimberlite was intersected in both holes drilled on A12 (see the Company's News Release of October 6, 2003). In addition to the drilling at targets A12 and A37, three holes were drilled on the target designated A38. A visual interpretation of the drill chips indicates that all holes drilled on A38 bottomed in basement dolomites without intersecting kimberlite. The drilling did not identify the source of the isolated bulls-eye magnetic anomaly associated with this target and further investigation is required.

Tsodilo Resources is an international diamond exploration company engaged in the search for economic kimberlites at its Ngamiland and Gcwihaba projects in northwest Botswana. The Ngamiland project is being investigated in partnership with Trans Hex Group (which has a 25% interest) and the Gcwihaba project in joint venture with SouthernEra Resources (which has a 50% interest). The design and conduct of the Company's exploration program is the responsibility of Dr. Andrew Moore, a professional geologist registered with the South African Council for Natural Scientific Professions.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

FOR FURTHER INFORMATION PLEASE CONTACT:

James M. Bruchs -- President and Chief Executive Officer: E-Mail jbruchs@tsodiloresources.com
Dr. Andrew E. Moore -- Vice President, Exploration: E-Mail amoore@tsodiloresources.com
Stephen Woodhead -- Chief Financial Officer & Corporate Secretary: E-Mail swoodhead@tsodiloresources.com
Head Office: Telephone +1 416 572 2033 Facsimile + 1 416 572 4164