January 14, 2008

Sanatana Diamonds Inc. Announces Private Placement Financing


Sanatana Diamonds Inc. (TSX VENTURE: STA) ("Sanatana" or the "Company") is pleased to announce that it has engaged a syndicate of agents led by Genuity Capital Markets and including J.F. Mackie & Company Ltd., Haywood Securities Inc. and Raymond James Ltd. (the "Agents") to complete a private placement financing (the "Offering"), on a marketed reasonable best efforts agency basis, to raise approximately $13,000,000 comprised of units (consisting of one common share and ½ of an 18 month common share purchase warrant) ("Units") and flow-through common shares ("Flow-Through Shares") of the Company. The issue price of the Units and the Flow-Through Shares will be determined in accordance with current market conditions.

The Units and Flow-Through Shares will be offered and sold by way of private placement exemptions in all provinces and jurisdictions of Canada as mutually agreed to by the Company and the Agents, into the United States via Rule 144A or in such other manner as not to require registration under the United States Securities Act of 1933, as amended and in jurisdictions outside of Canada and the US.

The Offering is subject to certain conditions including, but not limited to, the receipt of all necessary corporate and regulatory approvals, including the acceptance of the TSX Venture Exchange.

The net proceeds from the sale of the Offering will be used to fund the exploration of the Company's diamond properties in Northwest Territories, working capital and general corporate purposes.

The Offering is expected to close on or before February 5, 2008. The Agents will be granted an option to purchase up to an additional 15% of the number of Units and Flow-Through Shares sold to cover over-allotments, if any, on the same terms and conditions as the securities issued under the Offering. All securities issues in connection with the Offering will be subject to a four month hold period. The Agents will receive a cash commission of 7.0% of the gross proceeds raised in this private placement and compensation warrants (the "Compensation Warrants") entitling the Agents to purchase such number of common shares as is equal to 7.0% of the aggregate number of Units and Flow-Through Shares sold pursuant to the private placement. Each Compensation Warrant will entitle the Agents to purchase one common share of the Company at an exercise price equal to the higher of the Market Price and issue price of the Units for a period of 12 months following the closing.

The securities being offered 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 in the absence of registration or an applicable exemption from the registration requirements. This press release does not constitute an offer to sell or the solicitation of an offer to purchase securities in the United States.

The Offering is subject to the approval of the TSX Venture Exchange. Neither the AIM Market of the London Stock Exchange PLC nor the TSX Venture Exchange has reviewed nor accepts responsibility for the adequacy or accuracy of this release.

For additional information on the Company, please contact:

Mr. Peter Miles, President and Chief Executive Officer, at 604-408-6680 or email

Seymour Pierce Limited (Nominated Adviser):
David Newton, at +44 (0) 20 7107 8000 or email