Continental Gold Executes Formalization Agreements With Small-Scale Miners at Its Buritica Project, Colombia

TORONTO, ONTARIO--(Marketwired - May 12, 2014) - Continental Gold Limited (TSX:CNL)(OTCQX:CGOOF) ("Continental" or the "Company") is pleased to announce the signing of formalization sub-contracts with five of seven small-scale mining associations, paving the way for the implementation of legal and responsible small-scale mining operations at the Company's Buriticá project. The remaining two sub-contracts will be signed following review by the Secretary of Mines of Antioquia. A ceremony in honour of the event was held on May 10, 2014 in the town of Buriticá, Antioquia, attended by the Ministry of Mines and Energy of Colombia, the National Mining Agency, the government of Antioquia, CORANTIOQUIA, the Mayor's Office at Buriticá, representatives of the seven associations of informal miners and senior executives of Continental. These sub-contracts are the first to be executed under Law 1658 of July 15, 2013 and will be regulated by Decree 480 of March 6, 2014, which importantly places all legal responsibilities on the individual small-scale mining associations and devolves the Company in this regard.

Once these small-scale mines begin operations in the coming months, 583 families will benefit directly from the formalization which in turn indirectly benefits the local economies, communities and the government's tax base. Additionally, the formalization sub-contracts will provide the blueprint for other regions of Colombia in governing how mining companies, small-scale miners and government can operate symbiotically, while simultaneously deterring non-sanctioned mining activities within a specific area.

Importantly for Continental, none of the seven areas jointly selected between the Company and the small-scale mining associations will impede Continental's current and future operations. As well, a 50-metre depth restriction from surface will be implemented, rendering these operations above the limit of a crown pillar at the top of the deposit built into the Company's future mine plans.

Mark Moseley-Williams, President and COO of Continental stated: "We are delighted for the miners involved in this process, and are proud that they have decided to incorporate the law into their mining operations. We look forward to working jointly towards the implementation of these new small-scale mines. The signing of these sub-contracts would not have been possible without the orchestrated effort of all the authorities involved in this matter. I would especially like to thank the Ministry of Mines and Energy, the National Mining Agency, the Secretary of Mines, CORANTIOQUIA and the office of the Mayor of Buriticá for moving these sub-contracts forward so rapidly.

"I would like to personally welcome Gold Mountain S.A.S., Sociedad Minero Ambiental Occidente S.A.S., Sociedad Minera San Roman S.A.S., Sociedad Minera Gualanday S.A.S., Asociación de Mineros Montaña Dorada (ASMIMODO), Sociedad Minera el Progreso No. 5 S.A.S. and San Antonio 2 S.A.S to our family," remarked Eduardo Otoya, Vice-President, Corporate Development of Continental. "I have spent a considerable amount of time over the past three years working towards this goal and am honoured to be associated with these companies."

"The execution of these sub-contracts is a landmark triumph for Colombia and represents an important milestone in the maturation of the Colombian gold mining industry," commented Ari Sussman, CEO of Continental. "The harmonization between the Colombia government, the Company and small-scale miners resulted in this positive outcome and all parties should be proud of their respective efforts."

"This is an extremely important opportunity for us, and it will contribute towards different social projects that will positively impact the region, while improving the quality of life of our families," said Miguel Ángel Úsuga, representative of Sociedad Minera San Román S.A.S.

"We are filled with a great joy in seeing this step fulfilled, while leaving behind the risks of informal mining and moving down the path of legality. We extend our sincere appreciation to the Government of Antioquia, the Ministry of Mines and Energy and Continental for joining us for this important milestone," remarked Fernando Restrepo, representative of the Sociedad Minera Gualanday S.A.S.

About Continental:

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.

For technical information on the Buriticá project, please refer to the technical report entitled "2012 Mineral Resource Estimate of the Buriticá Gold Project, Colombia" dated November 15, 2012, effective as at October 22, 2012, 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 rest of Continental's suite of gold exploration properties are also available at www.continentalgold.com.

Forward-Looking Statements

This press release contains or refers to forward-looking information under Canadian securities legislation, including statements regarding successfully completing the formalization process with small-scale mining groups, exploration and mine development plans, and timing of the commencement of construction and operations, and is based on current expectations that involve a number of business risks and uncertainties. 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. 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.