Homeland Energy Group Provides Operations Update

TORONTO, CANADA--(Marketwire - Nov. 5, 2012) - Homeland Energy Group Ltd. (TSX:HEG) ("Homeland" or the "Company") wishes to advise that it has terminated its relationship with its mining contractor and is undertaking a new tendering process.

Management has become concerned that the current mining contractor had not been effectively able to mobilize the equipment necessary to undertake the Company's new mining plan which was announced in September. As a result, management made the decision to terminate the contract immediately and seek a new contractor rather than allow the existing state of operations to continue.

Several reputable contractors have been on site and are in the process of submitting bids. The Company hopes to have a new contractor in place by mid January after the Christmas slow down. However, as a result of this decision, mining operations at the Kendal mine have been halted until a new contractor has been retained.

The Corporation will provide a further update when more information is available.

Homeland Energy Group Ltd. (TSX:HEG) is a coal producer with operations in the Witbank area of South Africa. The company also has a large-scale development property in South Africa and exploration interests in Southern Africa. Homeland will continue to seek out interests in additional coal projects in South Africa and neighbouring countries as well as internationally. Homeland Energy Group Ltd. is currently traded on the Toronto Stock Exchange under the symbol "HEG" with 471,204,149 common shares issued and outstanding. www.homelandenergygroup.com