SouthernEra Strategic Review and New Financial ...

SouthernEra Completes Strategic Review and Hires Financial Advisor

    Shares issued and outstanding: 160,054,229
    TSX: SDM
    AIM: SRE

    TORONTO, ON AND LONDON, UK, Oct. 11 /CNW/ - The Board of SouthernEra
Diamonds Inc. (TSX: SDM, AIM: SRE) ("the Company") today announced that it has
completed a comprehensive strategic review of the Company's asset base and
business plans with a view to accelerating the Company's transition to once
again becoming a profitable diamond producer.
    SouthernEra's key strategic objective is to discover a large high grade
primary kimberlite that has the potential to support sustainable long-term
profitable production. Within the Company's current wide portfolio, the Board
believes that its DRC primary kimberlite projects, particularly its joint
venture kimberlite projects with BHP Billiton, offer the best potential to
achieve this key strategic objective. In addition, the Board believes that its
current portfolio of early-stage 100 percent owned primary exploration
projects in Ontario, Canada, also offer good potential to achieve this
objective.
    In support of this strategic objective, the Board believes that it is
imperative to secure near-term profitable production to support the Company's
continuing exploration programs in the DRC and Canada. In the view of the
Board this near-term tactical objective can be best achieved by accelerating
the Company's extensive DRC alluvial projects.
    The Board is determined to focus the Company's management, technical and
financial resources exclusively on achieving the key objective of sustained
profitable diamond production. In this regard it has retained the services of
River Capital Partners Limited to work closely with the Special Committee of
the Board in support of the Company's new strategic business plan.
    Commenting, Chairman Chris Jennings said:
    "SouthernEra Diamonds has its roots as one of Canada's most successful
international diamond exploration companies. Over the past fifteen years the
Company has conducted a successful global diamond exploration campaign,
discovering more that 100 diamondiferous kimberlites in Canada, South Africa,
Democratic Republic of Congo, Australia and Gabon and developing two new
diamond mines from certain of these discoveries.
    In recent years SouthernEra has been successful in establishing strong
exploration bases in a number of regions that offered the potential for major
new diamond discoveries. Based on the results of this wide and diverse program
we are now in a position to focus our continuing exploration efforts on those
regions that offer the very best potential for major new discoveries. In
particular, we believe that our DRC primary kimberlite projects offer
exceptional potential. The fact that a significant number of these projects
are now being fully funded by BHP Billiton demonstrates their potential and
allows us to move forward more quickly in this large prospective area with
greater speed than we could achieve on our own. We are now entering a period
during which we will be keenly focused on realizing the value of our asset
base for the benefit of shareholders by delivering sustainable profitable
production."

    SouthernEra Diamonds Inc. is a Canadian, fully integrated, diamond
company focused on discovering a large high grade primary kimberlite,
providing sustainable long-term profitable production.

    Some statements contained in this news release are forward-looking and,
therefore, involve uncertainties or risks that could cause actual results to
differ materially. Such forward-looking statements include comments regarding
exploration work. Actual results could differ materially from those
anticipated. The Company disclaims any obligation to update forward-looking
statements.

For further information: SouthernEra Diamonds Inc., Alasdair MacPhee,
President and CEO, or Sharon Allan, Investor Relations, Telephone: (416)
359-9282, Fax: [phone], E-mail: inbox(at)southernera.com,
www.southernera.com; London: 4C-Burvale, Carina Corbett, Director, Telephone:
++44 (0) 207-907-4761, Fax: ++44 (0) 207-907-4769, Email:
Corbett(at)4c-burvale.co.uk
(SRE)