Caledonia Announces the Signing of a Fourth Cob...

FOR:  CALEDONIA MINING CORPORATION

TSX SYMBOL:  CAL
OTC Bulletin Board SYMBOL:  CALVF
AIM SYMBOL:  CMCL

March 25, 2008

Caledonia Announces the Signing of a Fourth Cobalt Sales Agreement

TORONTO, ONTARIO--(Marketwire - March 25, 2008) - Caledonia Mining Corporation ("Caledonia")
(TSX:CAL)(OTCBB:CALVF)(AIM:CMCL) is pleased to announce its wholly owned subsidiary company Caledonia Nama
Limited ("Nama") has signed a fourth cobalt off-take agreement with a large Chinese refiner. This now brings
the contractual commitments for the Nama Cobalt Project to a total of 51,560 tonnes (+/-10% at Nama's option)
of cobalt metal equivalent for 2009 and 2013, and meets the full anticipated plant capacity currently being
designed.

Under the terms of this new agreement Nama will supply a minimum of 16,000 tonnes of cobalt metal equivalent,
in the form of cobalt hydroxide, from the Nama Cobalt Project. This agreement, in common with the previous
agreements announced on January 29 and March 11, 2008, specifies that the price shall be based on the published
monthly average quotation for cobalt low grade in the London Metal Bulletin, and has a guaranteed "Take or Pay"
provision at market related prices.

The Nama Cobalt Project is located in Northern Zambia. Nama plans to commence mining Anomalies "A" and "C"
using open pit mining methods, pre-concentration and conventional cobalt extractive technology. Detailed mine
planning is underway and the Company expects to commence operations in early 2009.

Commenting on the announcement Stefan Hayden, President and CEO, said "The signature of this fourth long term
supply contract effectively means that the current planned production capacity at Nama is now fully committed
for the next five years. The signing of these four contracts conclusively demonstrates the strong future demand
for cobalt from China and confirms the attractiveness of the Nama Project, as a primary cobalt producer, to
refiners. Caledonia continues to progress the Nama Project towards production as rapidly as possible."

Further information regarding Caledonia's exploration activities and operations along with its latest
financials may be found at www.caledoniamining.com.

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FOR FURTHER INFORMATION PLEASE CONTACT:

Caledonia Mining Corporation
Stefan Hayden
President & CEO
[phone]
Website: www.caledoniamining.com

OR

BuckBias
Alex Buck
[phone]

OR

RBC Capital Markets
Martin Eales
[phone]

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Caledonia Mining Corporation