Skye announces closing of previously announced unit offering and exercise of over-allotment option

    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION
    IN THE UNITED STATES/

    TSX Symbol: SKR

    VANCOUVER, Oct. 26 - Skye Resources Inc. ("Skye") (TSX:SKR) is
pleased to announce that it has closed its offering of 5,400,000 units
("Units") of Skye at a price of $12.10 per Unit and that the over-allotment
option for a further 810,000 Units has been exercised. Total gross proceeds
were $75,141,000. Each Unit consists of one common share of Skye and one-half
of one common share purchase warrant of Skye, with each whole warrant
entitling the holder thereof to acquire a further common share at an exercise
price of $15.13 per share until January 26, 2009.
    TD Securities Inc. acted as the lead underwriter in connection with the
offering, with CIBC World Markets Inc., UBS Securities Canada Inc., Merrill
Lynch Canada Inc., BMO Nesbitt Burns Inc., Canaccord Capital Corporation,
Scotia Capital Inc., Orion Securities Inc., and Paradigm Capital Inc.,
comprising the remainder of the syndicate.

    About Skye

    Skye is an international mining company focused on becoming a new
mid-tier nickel producer. Skye acquired the rights to its Guatemalan lateritic
nickel project (the Fenix project) in December 2004 and in October 2006
completed a feasibility study for a ferro-nickel project at Fenix using proven
conventional smelting technology. In June 2007 Skye received its environmental
permits for the project, and expects to initiate construction during the first
quarter of 2008 with initial production in late 2009. www.skyeresources.com

    Cautionary Notices:

    This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities mentioned herein in the United
States. The securities have not been and will not be registered under the U.S.
Securities Act of 1933, as amended (the "U.S. Securities Act") or any state
securities laws and may not be offered or sold within the United States or to
U.S. Persons unless registered under the U.S. Securities Act and applicable
securities laws or an exemption from such registration is available.

    This news release contains certain forward-looking statements that
involve risks and uncertainties, such as statements of Skye's plans,
objectives, strategies, expectations and intentions. The words "may", "would",
"could", "will", "intend", "plan", "anticipate", "believe", "estimate",
"expect" and similar expressions, as they relate to Skye, or its management,
are intended to identify such forward-looking statements. Many factors could
cause Skye's actual results, performance or achievements to be materially
different from any future results, performance or achievements that may be
expressed or implied by such forward-looking statements. The forward-looking
statements included in this news release represent Skye's views as of the date
of this news release. While Skye anticipates that subsequent events and
developments may cause its views to change, it specifically disclaims any
obligation to update these forward-looking statements. These forward-looking
statements should not be relied upon as representing its views as of any date
subsequent to the date of the news release. All subsequent written and oral
forward-looking statements attributable to Skye or persons acting on its
behalf are expressly qualified in their entirety by this notice.

For further information: Media Inquiries: Andrew Grant, Vice President,
Public Relations, Tel: (604) 602-9500, agrant@skyeresources.com; Investor
Inquiries: David Bryson, Vice President, Finance & Treasurer, Tel: (604)
602-9500, dbryson@skyeresources.com; Martti Kangas, Investor Relations, The
Equicom Group, Tel: (416) 815-0700 x 243, mkangas@equicomgroup.com; David
Feick, Investor Relations, The Equicom Group, Tel: (403) 538-4787,
dfeick@equicomgroup.com