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Press release from Marketwire

Exploration on the Mine License Produces 85 Metres at 3.0 gpt Gold and 99 Metres at 1.3 gpt Gold

Monday, February 27, 2012

Exploration on the Mine License Produces 85 Metres at 3.0 gpt Gold and 99 Metres at 1.3 gpt Gold16:01 EST Monday, February 27, 2012TORONTO, ONTARIO--(Marketwire - Feb. 27, 2012) - Teranga Gold Corporation (TSX:TGZ)(ASX:TGZ) ("Teranga" or "the Company") is pleased to provide an update of its Mine License Exploration program. Highlights: Exploration at the Sabodala Pit continues to confirm higher grades in a potentially expanded pit to depth and to the north - drilling intersected significant widths of mineralization, including holes SBDH161D of 85 metres at 3.0 grams of gold per tonne ("gpt") and SBDH162D of 99 metres at 1.3 gpt near to the limit of the current pit design, both on the Main Flat Extension ("MFE") - the zones remain open down plunge on the section. Both holes also cut the Lower Flat Zone ("LFZ") showing significant widths of high grade gold mineralization."The best place for us to find more ounces is around our existing pit. We are getting excellent results giving us confidence that we will be able to convert a significant portion of our inferred resources to M and I and ultimately to reserves which is the objective of our program in this area. And this is but one of at least 5 targets we plan on drilling on our Mine License this year" quotes Alan Hill, Chairman and Chief Executive Officer.Mine License ("ML") Exploration Exploration results in 2011 and 2012 supported management's belief of the potential to expand existing gold mineralization by an additional 20 to 30 million tonnes at grades between 1.5 and 2.0 gpt for a total inventory of 2.5 to 3.5 million ounces from the Sabodala ML over the next 12 to 18 months.1 The larger gold inventory base is expected to result from the success of deepening the Sabodala pit to the north along the Main Flat Extension, extension of the Masato pit onto the ML, conversion of Niakafiri resources to reserves as well as potentially developing satellite deposits such as Soukhoto, Niakafiri West and Dinkokhono. On the ML alone, this would increase the mine life to approximately 15 years at a run rate of about 200,000 ounces of gold produced annually and provide a solid production base to build on through the Regional Exploration Program. In order to increase gold inventory on the ML a minimum of 6 drill rigs have been budgeted for the purpose of testing new targets as well as attempting to convert existing resources to reserves at an estimated cost of $20 million in 2012. Drilling during the first and second quarters of 2012 at Sabodala will be focused on in-filling and extending mineralization in the immediate vicinity of the current ultimate pit.There are 7 drills operating on the ML at the present time (6 DD and 1 RC) and pending rig availability this number may increase to expedite resource expansion and reserve definition drilling through 2012.Main Flat Extension ("MFE") - Figure 1 The Main Flat is one of the principal gold hosts in the Sabodala deposit. In the southern part of the deposit this structure dips shallowly to the west, rolls flat and then rolls to a moderate northerly dip as it exits the ultimate pit. The MFE drill program is designed to test the continuity of this structure to the north beginning with in-filling holes in the deepest part of the current mine design then stepping out to the north. Drilling strategy for the MFE has the following objectives to support resource and reserve expansion:Convert Inferred resources outside of the end of year 2011 ultimate pit; Extend Main Flat M&I resources down dip to the west, and to the east into Sambaya Hill; Identify potential underground mineable resources to depth as MFE plunges to the north; Test for extension of LFZ to the east; and Test for parallel zones beneath the Sabodala pit.More than 10,000 metres of drilling are planned on the MFE through the first and second quarters of 2012. Recent results include drill hole SBDH161D, a vertical diamond hole collared on section 20650N at Sabodala has intersected 85 metres of 3.0 gpt from 120 metres down the hole in the Main Flat and 43 metres of 3.2 gpt in 3 zones beginning 351 metres down the hole. The upper Main Flat intercept of this hole ties into two holes that were previously announced. It sits approximately 20 metres north of hole SBDH157D (previously announced) that cut 53 metres at 4.5 gpt from 125 metres and 45 metres west of hole SBDH160DD (previously announced) which cut 70 metres at 3.0 gpt from 175 metres down the hole. Twenty metres to the north on section 20670N, two new drill holes have both cut the Main Flat with 99 metres of 1.3 gpt in SBDH162D and 62 metres of mineralization at 2.0 gpt in SBDH163 in two zones. SBDH162D was drilled 20 metres north of SBRC744D (previously announced), a vertical hole that cut 64 metres of 3.1 gpt from 221 metres. SBDH163 was drilled 20 metres to the west of SBDH162D. SBDH163 also cut 26 metres of mineralization in Ayoub's within 70 metres of the surface. At the far end of the current Sabodala open pit on section 20770N, a new hole, SBDH172 drilled from the haulage ramp cut 29 metres at 1.4 gpt from 255 metres down the hole. This intercept lies 100 metres below the current ultimate pit within the Main Flat. This hole is an in-fill hole drilled 25 metres east of SBDH171DD (previously announced) which cut 8 metres at 1.3 gpt from 263 metres, 12 metres at 1.4 gpt from 274 metres and 12 metres at 1.6 gpt from 300 metres down the hole in the same zone. Lower Flat Zone ("LFZ") - Figure 1 LFZ mineralization is cut in new hole SBDH161D on section 20650N where 43 metres of 3.2 gpt corresponds well to the 27 metres of 3.6 gpt cut by SBDH160DD (previously announced) 45 metres to the west from 420 metres. In addition, new drill hole SBDH158D, a vertical hole collared on section 20630N at Sabodala has intersected 6 metres of 14.7 gpt from 325 metres down the hole in the LFZ 20 metres west of SBDH157D (previously announced) that cut 20 metres of 1.7 gpt from 353 metres. Both holes were collared on the 650RL bench within the Sabodala pit. New hole, SBDH162D also cut multiple zones of the Lower Flat on section 20670N at depths greater than 350 metres from the surface including 11 metres at 4.2 gpt from 353 metres. The goal of the MFE program is to add 250,000 to 500,000 ounces of gold to the open pit mineable gold inventory at an average grade between 1.5 - 2.0 gpt, as well as potentially a similar amount to underground at an average grade of 3.0 - 4.0 gpt, in 2012.2 Mill Expansion Update and 2012 Guidance The major tie-in for the mill expansion has been completed and the mill is on schedule to be operational by the end of this quarter. With the expansion complete, the Company expects to produce 210,000-225,000 ounces of gold at a cash cost of $600-$650 per ounce for the year.To view Figure 1 - Long section 10050E looking east, please visit the following link: http://media3.marketwire.com/docs/TGZ-Figure1.jpg.MAIN FLAT EXTENSION:RC & DIAMOND DRILLING, AQUA REGIA RESULTSIntercept with cut-off 0.2 gpt Au and max 2m internal dilutionHOLE IDFROM (m)INTERSECTION1SBDH161D12085m @ 3.0 gpt120Inc 39m @ 1.8 gpt161Inc 22m @ 2.5 gpt186Inc 19m @ 6.5 gpt35110m @ 2.4 gpt36511m @ 7.2 gpt37915m @ 1.8 gptSBDH162D18099m @ 1.3 gpt180Inc 14m @ 1.3 gpt196Inc 31m @ 2.1 gpt229Inc 17m @ 0.6 gpt35311m @ 4.2 gpt4304m @ 4.3 gpt4812m @ 5.0 gptSBDH17225529m @ 1.4 gptSBDH158D13910m @ 1.4 gpt3256m @ 14.7 gpt4083m @ 3.4 gptSBDH1634219m @ 0.6 gpt647m @ 2.9 gpt12343m @ 1.8 gpt124Inc 6m @ 5.3 gpt17719m @ 2.5 gpt188Inc 4m @ 6.1 gptSBDH171DD***2638m @ 1.3 gpt27412m @ 1.4 gpt30012m @ 1.6 gptSBDH157D***12553m @ 4.5 gptSBRC744D***22164m @ 3.1 gptSBDH160DD***42027m @ 3.6 gpt1True widths to be determined *** previously releasedAll assays are determined using aqua regia in the on-site SGS lab at Sabodala. Pulps are being systematically sent to Kayes, Mali for fire assay as confirmation of the Sabodala lab results.About TERANGA Teranga Gold Corporation is a Canadian-based gold company listed on the Toronto Stock Exchange (TSX:TGZ) and Australian Securities Exchange (ASX:TGZ). Teranga is principally engaged in the production and sale of gold, as well as related activities such as exploration and mine development. Teranga was created to acquire the Sabodala gold mine and a large regional exploration land package, located in Senegal, West Africa, from Mineral Deposits Limited. Management believes the mine operation, together with the Company's prospective 1,500 km2 land package, provides the basis for growth in reserves, production, earnings and cash flow as new discoveries are made and processed through the Company's existing mill. The Sabodala Gold Operation, which came into operation in 2009, is located 650 kilometres east of the capital Dakar within the West African Birimian geological belt in Senegal, and about 90 kilometres from major gold mines and discoveries in Mali. Forward Looking Statements Certain information contained in this report, including any information on Teranga's plans or anticipated future results, future financial or operating performance and other statements that express management's expectations or estimates of future performance constitute forward-looking statements. Such statements are based on a number of estimates and assumptions that, while considered reasonable by management at the time, are subject to significant business, economic and competitive uncertainties. Teranga cautions that such statements involve known and unknown risks, uncertainties and other factors that may cause the actual financial results, performance or achievements of Teranga to be materially different from the company's estimated future results, performance or achievements expressed or implied by those forward-looking statements. These factors include the inherent risks involved in exploration, development and operations of mineral properties, changes in economic conditions, changes in the worldwide price of gold, silver fuel, electricity and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga. Nothing in this report should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities. Accordingly, readers should not place undue reliance on such forward looking statements. Teranga expressly disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws. Competent Persons Statement The technical information contained in this release relating to exploration activities within the mining license is based on information compiled by Mr. Bruce Van Brunt, who is a Fellow of The Australasian Institute of Mining and Metallurgy and is also a registered professional geologist in the State of Washington, USA. He is qualified as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves" and as defined in NI43-101. Mr. Van Brunt has consented to the inclusion of this information in the form and context in which it appears in this release. Mr. Van Brunt is a full-time employee of Teranga and is therefore not independent. 1 This "exploration target" is not a Mineral Resource. While management has confidence in its projections based on exploration work done to date, the potential quantity and grade disclosed herein is conceptual in nature, and there has been insufficient exploration to define a mineral resource, therefore it is uncertain if further exploration will result in the targets being delineated as a Mineral Resource. 2 This "exploration target" is not a Mineral Resource. While management has confidence in its projections based on exploration work done to date, the potential quantity and grade disclosed herein is conceptual in nature, and there has been insufficient exploration to define a mineral resource, therefore it is uncertain if further exploration will result in the targets being delineated as a Mineral Resource. FOR FURTHER INFORMATION PLEASE CONTACT: Kathy SiposTeranga Gold CorporationVice-President of Investor & Stakeholder Relations416-594-0000ksipos@terangagold.comwww.terangagold.com