Drilling Report

FOR:  CALEDONIA MINING CORPORATION

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

July 18, 2005

Caledonia Announces Summer Drilling Program on Kikerk Lake Property, Nunavut

TORONTO, ONTARIO--(CCNMatthews - July 18, 2005) - Caledonia Mining Corporation ("Caledonia")
(TSX:CAL)(OTCBB:CALVF)(AIM:CMCL) is pleased to announce that approval for a $500,000 summer exploration program
at the Kikerk Lake property in Nunavut has been given by the joint venture partners, Caledonia, Ashton Mining
of Canada ("Ashton") and Stornoway Diamond Corporation ("Stornoway").

This program will include ground geophysical surveying, indicator mineral sampling and further drilling to
investigate the diamondiferous Stellaria kimberlite, which the joint venture discovered in 2002.

Stellaria is interpreted to be a steeply dipping hypabyssal dyke with an estimated true width of 13 metres. The
kimberlite lies along a geophysically-defined linear feature with an estimated length of two kilometres. As
reported on November 8, 2002, caustic dissolution analysis of 110 kg of kimberlite from Stellaria returned 67
diamonds, including one diamond measuring 2.3 x 1.4 x 0.9 mm. Work on the property in 2004 included indicator
mineral sampling in the area surrounding Stellaria to prioritize potential drill targets.

In light of the encouraging initial diamond results, the joint venture will carry out additional work on
Stellaria during the summer field season. The program will include the drilling of as many as six core holes in
an effort to better define the potential length and width of the dyke and investigate the associated linear
feature.

The Kikerk Lake property is located approximately 20 kilometres northeast of the Knife Lake kimberlite
currently undergoing evaluation by De Beers Canada Exploration Inc. The property also hosts the Potentilla
kimberlite, located 700 metres east of Stellaria. As reported on September 16, 2002, a 5.83 tonne sample of
drill core collected from Potentilla returned an estimated diamond content 17.5 carats per hundred tonnes. The
diamonds recovered from this sample include a 0.34 carat colourless stone.

Exploration on the Kikerk Lake property is governed by a joint venture agreement between Ashton, Stornoway and
Caledonia. The current respective interests of the parties are Ashton 52.5 percent, Stornoway 30.0 percent and
Caledonia 17.5 percent. Ashton has an option to increase its interest to 59.5 percent by carrying Caledonia to
completion of a feasibility study.

In total, 21 kimberlites, including eleven that contain diamonds, have been discovered in the Coronation Gulf
region. Ashton is the operator of all of the Kikerk Lake joint venture and Brooke Clements, Professional
Geologist and Ashton's Vice President, Exploration, is responsible for the design and conduct of the
exploration programs, and the verification and quality assurance of analytical results.

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

Certain statements included herein are "forward-looking statements". Management cautions that forward-looking
statements are not guarantees and that actual results could differ materially from those expressed or implied
in the forward-looking statements. Important factors that could cause the actual results of operations,
exploration or development programmes, or the financial condition of the Company, to differ include, but are
not necessarily limited to, the risks and uncertainties discussed in documents filed by the Company with the
various regulatory authorities having jurisdiction.

-30-

FOR FURTHER INFORMATION PLEASE CONTACT:

Caledonia Mining
Stefan Hayden
President and CEO
[phone]
www.caledoniamining.com

OR

BuckBias
Alex Buck / Nick Bias
[phone]

-0-

Caledonia Mining Corporation