Continental Gold Notifies Warrant Holders of Approaching Expiry of Warrants

TORONTO, ONTARIO--(Marketwire - Sept. 7, 2012) - Continental Gold Limited (TSX:CNL)(OTCQX:CGOOF) ("Continental" or the "Company") would like to remind holders of Continental common share purchase warrants trading on the Toronto Stock Exchange under the symbol CNL.WT (the "Warrants") that the Warrants are set to expire at 5:00 p.m. (Toronto time) on September 16, 2012; however, since such date occurs on a weekend, any exercises of Warrants must be effected on or prior to September 14, 2012. Any Warrants remaining unexercised after the expiration deadline will be cancelled, delisted, and will thereafter be of no force or effect.

Currently, there are 5,694,000 Warrants outstanding at an exercise price of $7.50 per Warrant. Assuming all Warrants are exercised, net proceeds to the Company would be $42.7 million.

How to Exercise Warrants

Warrant holders who wish to exercise their Warrants should instruct their investment advisor to effect an "immediate exercise". Once our transfer agent, Olympia Transfer Services Inc., receives payment and the required documentation, the Warrants will be cancelled and the warrant holder will receive Continental common shares.

Investors should consult with their investment advisor to confirm the time required to complete this process and other costs associated with the exercise, if any.

Warrant holders who hold a physical certificate wishing to exercise Warrants are required to provide Olympia Transfer Services Inc. with a certified cheque, bank draft or money order payable to Continental Gold Limited, as well as the warrant certificate with the subscription form on reverse completed.

For assistance, contact Olympia Transfer Services Inc. directly at 1-416-364-8081.

Other Updates

The Company has recently completed an animation video that describes the Buriticá project and the proposed future development which is now available on the Company's website at www.continentalgold.com.

Furthermore, Ari Sussman, Chief Executive Officer, will be speaking at the 2012 Denver Gold Forum in Denver, Colorado, USA on Monday, September 10, 2012. The presentation will begin at approximately 9:00 A.M. MDT. A copy of the corporate presentation is available on the Company's website at www.continentalgold.com.

About Continental Gold

Continental Gold Limited is an advanced-stage exploration and development company with an extensive portfolio of 100%-owned gold projects in Colombia. Spearheaded by a team with over 40 years of exploration and mining experience in Colombia, the Company is focused on advancing its high-grade Buriticá gold project to production. A maiden mineral resource estimate classified in accordance with NI 43-101 for its Buriticá project covers two major vein systems, with combined measured and indicated mineral resources of 1,110,000 tonnes of mineralized material containing 630,000 ounces of gold grading 17.8 g/t gold, 1,500,000 ounces of silver grading 42 g/t silver, and 18,700,000 pounds of zinc grading 0.8% zinc. The inferred mineral resource is 6,900,000 tonnes of mineralized material containing 2,500,000 ounces of gold grading 11.4 g/t gold, 9,500,000 ounces of silver grading 43 g/t silver and 88,000,000 pounds of zinc grading 0.6% zinc. For additional technical information on the Buriticá project, please refer to the Company's technical report entitled "Mineral Resource Estimate of the Buriticá Gold Project, Colombia" dated October 24, 2011, as amended November 23, 2011, prepared by Andrew J Vigar, BAppSc Geo, FAusIMM, MSEG, and Martin Recklies, BAppSC Geo, MAIG, each of Mining Associates Pty Limited, available on SEDAR at www.sedar.com, on the OTCQX at www.otcmarkets.com and on the Company website at www.continentalgold.com. Additional details on the Buriticá project and the rest of Continental's suite of gold exploration properties are available at www.continentalgold.com. The scientific and technical information contained in this press release has been reviewed and approved by Mark Moseley-Williams, President and Chief Operating Officer of the Company, who is a qualified person within the meaning of NI 43-101.

Forward-Looking Statements

This press release contains or refers to forward-looking information, including statements regarding the estimation of mineral resources, exploration results, potential mineralization, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, failure to convert estimated mineral resources to reserves, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry forward-looking statements are subject to significant risks and uncertainties, and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and the Company assumes no responsibility to update them or revise them to reflect new events or circumstances other than as required by law.

Differences in Reporting of Mineral Resource Estimates

This press release was prepared in accordance with Canadian standards which differ in some respects from United States standards. In particular, and without limiting the generality of the foregoing, the terms "inferred mineral resources," "indicated mineral resources," "measured mineral resources" and "mineral resources" used or referenced in this press release are Canadian mining terms as defined in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM") Standards on Mineral Resources and Mineral Reserves (the "CIM Standards"). The CIM Standards differ significantly from standards in the United States. While the terms "mineral resource," "measured mineral resources," "indicated mineral resources," and "inferred mineral resources" are recognized and required by Canadian regulations, they are not defined terms under standards in the United States. "Inferred mineral resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. Under Canadian securities laws, estimates of inferred mineral resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted into reserves. Readers are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable. Disclosure of "contained ounces" in a resource is permitted disclosure under Canadian regulations; however, United States companies are only permitted to report mineralization that does not constitute "reserves" by standards in the United States as in place tonnage and grade without reference to unit measures. Accordingly, information regarding resources contained or referenced in this press release containing descriptions of our mineral deposits may not be comparable to similar information made public by United States companies.