Tolima Gold Inc. Acquires Additional Gold Exploration and Development Properties and Consolidates its Land Position in the Tolima North Mining District of Colombia

TORONTO, ONTARIO--(Marketwire - Dec. 28, 2011) -

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Tolima Gold Inc. ("Tolima") (TSX VENTURE:TOM) announced today that it has closed the purchase of all of the issued and outstanding share capital of "Sun Lakes Advisors SA" ("Sun Lakes") a Panamanian company which owns all of the issued and outstanding share capital of "Papayo Gold SAS" ("Papayo Gold"), a Colombian company holding the following assets: (i) a gold mining concession; (ii) an application for a conversion into concession of a "de facto" mining operation (collectively the "Mineral Properties"); (iii) land property rights where certain mining works are located within the Mineral Properties; as well as (iv) certain mining equipment and mining works on the Mineral Properties. The Mineral Properties cover approximately 2,000 hectares and are almost completely surrounded by several of Tolima's current Nortol properties (http://www.tolimagold.com/pdf/NortolMap.pdf).

The total cost for the acquisition of Sun Lakes and Papayo Gold, including the Mineral Properties, land and equipment was US$5,100,000 in cash and 3,297,000 in common shares of Tolima. The cash consideration has been paid on closing; except for US$200,000 which has been left in escrow pending regulatory approvals of (i) the conversion into concession of the application of 10 hectares and (ii) the work plan for the existing concession. The consideration in shares shall be paid upon Tolima receiving all required regulatory approval, including the approval of the TSX Venture Exchange.

The Mineral Properties are almost completely surrounded on all sides by 18,000 hectares of current Tolima mining properties. This transaction will consolidate an area of more than 20,000 hectares within the north-east trend of the Nortol properties where the most important operating mines in the area are located. The main structures within the Mineral Properties are the "Palestina" fault, to the north-east, and the "Mulato" fault to the east. Tolima has conducted some preliminary sampling of the existing and old mining works within the Mineral Properties and has identified mineralization within metamorphic rocks of the "Cajamarca" complex, which hosts the main known gold deposits (Porphyry Au and Vein gold deposits) of the Colombian central range, such as the "Frontino" and "Colosa" deposits, as well as the "Gran Porvenir" and other active mines in the Tolima North mining district. The sampled veins have widths ranging from 0.50 to 6.0 meters. Tolima has taken over 100 channel samples from the Mineral Properties and is having them assayed. Tolima will be releasing results of such sampling as soon as practical.

"This acquisition is a great addition to our Nortol properties," commented Jaime Lopez, CEO of Tolima. "It is part of our selective strategy of consolidation of our land position in the Northern Tolima Department within a competitive environment. The Mineral Properties are almost completely surrounded by our most promising current properties, with preliminary mining works and within the trend where the most important operating gold mines of the district are located. This property fits perfectly with our 2012 exploration plan. It covers already identified trends which now will be explored comprehensively. That will allow us to better understand the geology of the area and to fast-track the exploration and development of our current targets."

Information Concerning Tolima

Tolima is a gold exploration and development company with contractual interests in gold properties in Colombia. Tolima's two material Mineral Properties are the Remedios Project, located in the Remedios/Segovia mining district in the Antioquia Department of Colombia, and the Marmato Project, located in the Marmato/Caramanta district in the Caldas and Antioquia Departments of Colombia. Tolima's interest in the Remedios Project also includes an underground mine in the development stage (the San Pablo Mine) and a gold processing and recovery plant located in the Remedios/Segovia district with capacity of approximately 100 tons per day, which Tolima intends to bring into operation and to expand current capacity. Tolima also has mining interests in the Nortol property, located in the Tolima Department of Colombia. Tolima is continuing to explore opportunities for the acquisition of additional mining interests in prospective mining districts in Colombia.

Cautionary Statements

Some of the interests in mining properties in Colombia held by Tolima are held beneficially and are subject to formal assignment to Tolima subsidiaries. Formal assignment is subject to review by the relevant mining authority and to registration before the National Mining Registry of Colombia, and is also subject to current compliance with the terms of each mining property and to meeting certain legal, financial and technical criteria. There is no certainty as to when such formal registration will be achieved.

Many of the interests are also held pursuant to preliminary or conditional documentation with the legal holders or beneficial holders of the respective mining titles or applications and are subject to further definitive agreements and conditions, and there is no certainty as to when such definitive documents will be completed or if the conditions will be satisfied.

Forward-looking statements

This news release contains certain "forward-looking statements" including, for example, completion of the proposed acquisition, the acquisition of additional mining interests by Tolima, the ability of Tolima to complete definitive documentation in respect of certain acquisitions and assets and the ability of Tolima to achieve formal assignment and registration of its mining properties. Such forward-looking statements involve risks and uncertainties, both known and unknown. The results or events depicted in these forward-looking statements may differ materially from actual results or events. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding and are implicit in, among other things: receipt of government and third party approvals in respect of transferring assets, the state of the capital markets; tax issues associated with doing business internationally, the ability of Tolima to successfully manage the political and economic risks inherent in pursuing mineral exploration opportunities in Colombia; and the ability of Tolima to obtain qualified staff, equipment and services in a timely and cost efficient manner to develop its business. Any forward-looking statement speaks only as of the date of this news release and, except as may be required by applicable securities laws, Tolima does not intend and disclaims any duty or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or results or otherwise.