News Column

Teranga Gold Corporation: December Quarter and 2012 Year End Report

Page 8 of 1

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TORONTO, ONTARIO -- (Marketwire) -- 02/20/13 -- Teranga Gold Corporation (TSX: TGZ)(ASX: TGZ) -

(All amounts are in US$ unless otherwise stated)

For a full explanation of Financial, Operating, Exploration and Development results please see the Audited Consolidated Financial Statements and Management's Discussion & Analysis for 2012 at www.terangagold.com.

2012 Annual Guidance Met With Record Production & Profits

-- Record annual profit of $79.9 million ($0.33 per share) in 2012 up from a loss of $16.0 million ($0.07 loss per share) in 2011. Record fourth quarter profit of $48.8 million ($0.20 per share) or 106 percent higher than the same prior year period.-- Gold production for 2012 was within original guidance of 210,000 - 225,000 ounces at 214,310 ounces, a Company record and 63 percent higher than for the same 2011 period. Gold production for the three months ended December 31, 2012 was 71,804 ounces, 96 percent higher than the same prior year period.-- Total cash costs for 2012 were within guidance, of $600 - $650 per ounce, at $627(1) per ounce sold compared to $782 per ounce for the twelve months ended December 31, 2011, a reduction of 20 percent. Fourth quarter total cash costs were $623 per ounce sold, compared to $809 per ounce in the same prior year period, a reduction of 23 percent.-- Gold hedge book reduced to 59,789 ounces at year end and further reduced to 38,105 ounces as at January 29, 2013. Management expects the hedge book to be extinguished by June 2013.-- The Company's cash, cash equivalents and bullion receivables at December 31, 2012 increased to $45.0 million, including $5.3 million in bullion receivables.-- Gold production for 2013 is expected to be in the range of 190,000 - 210,000 ounces at total cash costs of $650 to $700 per ounce.(1)-- Gora technical study confirmed reserves of 285,000 ounces to be mined over 4-years at total cash costs of $675 to $700 ounce.-- Measured & Indicated resources increased 34 percent to 2.9 million ounces, while reserves remain similar to 2011 net of production.



"With the mill expansion complete and optimization work well underway we expect to be able to maintain an annual production profile of about 200,000 ounces from our mine licence alone. We expect Gora, the most advanced in our exploration pipeline, will be additive to this production base leveraging off of our central milling facility as we target our first phase growth of 250,000 to 350,000 ounces of annual production," said Alan R. Hill, Executive Chairman.

Financial Highlights

-- Gold revenue for the twelve months ended December 31, 2012 was $350.5 million compared to gold revenue of $236.9 million for the fifteen months ended December 31, 2011. The increase in gold revenue was driven by higher gold sales and spot gold prices. Revenues exclude the impact of realized losses on ounces delivered into forward sales contracts which are classified within losses on gold hedge contracts.-- Consolidated profit for 2012 was $79.9 million ($0.33 per share) up from a loss of $16.0 million ($0.07 loss per share) during the fifteen months ended December 31, 2011. The increase in profit was primarily due to an increase in gross profit from higher revenues, lower regional exploration expenditures and lower gold hedge losses, partly offset by a non-cash impairment charge recorded in 2012, related to an available for sale financial asset.



"As we eliminate the hedge book by mid-year, we anticipate that the increased cash margins and cash flows will provide us with a stronger balance sheet that should be able to fund our organic growth through our extensive exploration program, while at the same time minimizing shareholder dilution," said Richard Young, President and CEO.

-- Capital expenditures for 2012, excluding reserve development expenditures, were $52.9 million, higher than the revised guidance of $50 million, and $9.2 million lower than the fifteen months ended December 31, 2011. Capitalized reserve development costs for the year were $30.4 million, higher than the revised guidance of $25 million, and $16.0 million higher than the fifteen months ended December 31, 2011. The increase over 2011 was the result of a focus on expanding resources within the Sabodala pit and converting resources to reserves.-- Total cash costs for 2012 were within guidance, of $600 - $650 per ounce, at $627 per ounce sold compared to $782 per ounce for the twelve months ended December 31, 2011, a reduction of 20 percent. The decrease in cash costs were mainly due to higher ounces produced.-- Total production costs, comprised of total cash costs including total depreciation and amortization, for the year were $850 per ounce sold, down from $1,031 per ounce sold for the twelve months ended December 31, 2011.-- Realized gold price for 2012 was $1,422 per ounce sold compared to $1,236 per ounce sold for the twelve months ended December 31, 2011. The higher realized gold price for 2012 reflects a lower percentage of gold delivered into forward sales contracts due to the buyback of 52,105 ounces during the second quarter of 2012, as well as higher gold prices in 2012.



Operating Highlights

-- Total tonnes mined for 2012 were 12 percent higher than the twelve months ended December 31, 2011 and 4 percent higher than planned. Ore tonnes mined were lower than plan but at better grades resulting in similar ounces mined compared to plan.-- Mill throughput for the twelve months ended December 31, 2012 was similar to the same prior year period as an increase in the milling capacity with the completion of the mill expansion in the third quarter 2012, was offset by lower throughput rates from harder ore processed in 2012 compared to the softer material that was available in 2011. Compared to budget, mill throughput for 2012 was approximately 20 percent lower than plan due to delays in commissioning the crushing circuit as part of the mill expansion.-- In the third quarter of 2012, the Company added depth to its management team to focus on growth. Alan Hill was appointed Executive Chairman, formerly Chairman and Chief Executive Officer and Richard Young was appointed President and Chief Executive Officer, formerly President and Chief Financial Officer. Mark English was also promoted to Vice President, Sabodala Operations, formerly Manager, Sabodala Gold Operations. In addition, Navin Dyal and Paul Chawrun were appointed Vice President and Chief Financial Officer and Vice President, Technical Services, respectively.



Exploration Highlights

-- The Sabodala Pit optimization work completed in the first quarter of 2012, based on the high grade drill results from the fourth quarter of 2011, defined a projected pit shell that included the Lower Flat Zone ("LFZ") at depth.-- Conversion of a large portion of these resources to open pit reserves will likely require higher gold prices as the orientation of both the Main Flat Extension ("MFE") and LFZ appear to be more steeply dipping than originally anticipated, negatively affecting the economics of an enlarged pit shell.-- The 2013 drill program for Sabodala is expected to be completed in the first quarter of 2013. At that time Management will assess the economics of both a larger open pit as well as evaluate an underground development option in the LFZ.-- Drilling in 2012 successfully extended the Masato mineralized limits to the south and down dip onto Teranga's mine licence ("ML") defining approximately 700,000 ounces of Inferred Resource.-- In 2012, we drilled 104,400 metres at a cost of $26 million on the ML. The original ML budget was $20 million but was expanded during the year to follow up on positive drill results at Sabodala.-- Within the regional land package ("RLP") we completed 62,500 metres of RAB drilling, 42,300 metres of RC and 2,400 metres of diamond drilling on 25 of our anomalies and targets, at a cost of $20 million, including Gora.-- The program for 2013 has been budgeted and will focus on fast-tracking work on our current priority targets at Nienyenko, Soreto, Diabougou, Tourokhoto-Marougou and Saiensoutou. Other targets will be followed up as work progresses on the RLP. A minimum budget of $20 million is allocated for the combined exploration programs on the RLP and ML. Additional funding is available and will be allocated on a priority basis for prospects with clear potential for reserves definition.



Development Highlights

-- At the Gora deposit, a combination of receipt of final assays, re- modelling and application of geo-statistics resulted in an increase in the Measured and Indicated Resource to 374,000 ounces of gold at 5.0 gpt. Technical and environmental work continued during 2012 and has progressed to initiate the permitting process in the first quarter of 2013.-- Gora is planned to be operated as a satellite to the Sabodala mine with limited local infrastructure and development. Ore will be trucked to, and processed at, our existing mill on a priority basis, displacing Sabodala feed as required.-- Mining by open pit methods will produce approximately 500,000 tonnes of ore per year for four years with a grade ranging from 2.8 gpt to 4.9 gpt, with an average mined feed grade of 4.22 gpt gold, containing 285,000 ounces(2) of gold. Metallurgical testing has revealed that Gora ore has similar properties to the Sabodala ore body and therefore blending will not impact overall gold recovery.-- The primary cost is the purchase of the mobile equipment fleet, which will be utilized as part of Teranga's long term mine plan upon completion of Gora. Additional costs include installation of the required infrastructure and project execution costs. The project capital cost is estimated to be $45 to $50 million.-- Total cash costs for Gora are estimated to average $675 to $700 per ounce sold on a life-of-mine basis. The Project economics based on the proposed operating scenario and a discount rate of 5 percent, return an after tax net present value (NPV 5 percent) of $105 million and an internal rate return (IRR) of 69 percent at an assumed gold price of $1500 per ounce.



Reserves

-- Total reserves as of December 31, 2012 on the ML were 33.13 million tonnes at 1.22 gpt totalling 1.30 million ounces, a decrease of 235,000 ounces or 15 percent. Since the updated reserves reflect drill assay results through August 2012, all drill results after August 20, 2012 will be included in an updated reserve in 2013.-- As at August 20, 2012, Measured and Indicated Resources at Sabodala increased by approximately 0.7 million ounces to 2.1 million ounces, a 43 percent increase over Measured and Indicated Resources as at December 31, 2011, before production.-- Full details regarding our Reserves and Resources as of December 31, 2012 (based upon August 2012 assay results) can be found in the Reserves & Resources section of the Management Discussion and Analysis.



Review of Financial Results

---------------------------------------------------------------------------- Twelve months Fifteen months(US$000's) ended December ended December --------------------------------- 2012 2011 --------------------------------- Current Restated (i)----------------------------------------------------------------------------Revenue 350,520 236,873Cost of sales (179,323) (148,812) --------------------------------- 171,197 88,061Exploration and evaluation expenditures (16,657) (31,659)Administration expenses (17,931) (13,448)Share based compensation (4,694) (12,411)Finance costs (7,789) (2,946)Losses on gold hedge contracts (15,274) (47,943)Gains/(losses) on oil hedge contracts (427) 2,203Net foreign exchange (losses)/gains (2,574) 4,486Impairment of available for sale financial asset (11,917) -Other income 36 848 ---------------------------------Profit/(loss) before income tax 93,970 (12,809)Income tax benefit 115 92 ---------------------------------Profit/(loss) for the period 94,085 (12,717)Profit/(loss)attributable to non- controlling interest 14,161 3,323 ---------------------------------Profit/(loss) attributable to shareholders of Teranga 79,924 (16,040)Basic earnings/(losses) per share 0.33 (0.07)



Review of Operational Results

---------------------------------------------------------------------------- Three months ended Twelve months ended December 31, December 31, ----------------------------------------- 2012 2011 2012 2011---------------------------------------------------------------------------- restated restatedOperating results Ore mined ('000t) 2,038 1,715 5,915 3,973 Waste mined ('000t) 5,274 4,736 22,962 21,818 Total mined ('000t) 7,312 6,451 28,877 25,791 Grade mined (g/t) 2.04 1.50 1.98 1.39 Ounces mined (oz) 133,549 82,710 376,185 177,362 Strip ratio waste/ore 2.6 2.8 3.9 5.5 Ore milled ('000t) 725 604 2,439 2,444 Head grade (g/t) 3.40 2.10 3.08 1.87 Recovery rate % 90.7 89.8 88.7 89.5 Gold produced(1) (oz) 71,804 36,695 214,310 131,461 Gold sold (oz) 71,604 34,665 207,814 137,136 Average price received $/oz 1,296 1,482 1,422 1,236 Total cash cost (incl. royalties)(2) $/oz sold 623 809 627 782 Mining (cost/t mined) 3.1 2.5 2.7 2.3 Milling (cost/t milled) 19.9 17.3 20.4 16.8 G&A (cost/t milled) 6.4 6.2 6.2 5.8Note (1) Gold produced represents change in gold in circuit inventory plus gold recovered during the periodNote (2) Cash cost per ounce is a non-IFRS financial measure with no standard meaning under IFRS



Cost of Sales

Twelve months Fifteen months ended December ended December 31, 31,(US$000s) 2012 2011 --------------------------------- Current Restated (i)Mine production costs 145,831 126,125Depreciation and amortization 52,660 40,077Royalties 10,491 7,035Rehabilitation 36 9Inventory movements (29,695) (24,434) ---------------------------------Total cost of sales 179,323 148,812 ---------------------------------



2013 Guidance

---------------------------------------------------------------------------- Year ending December 31, --------------------------------- 2012 2013 Actuals Guidance RangeOperating results Ore mined ('000t) 5,915 4,000 - 4,500 Waste mined ('000t) 22,962 31,000 - 32,000 --------------------------------- Total mined ('000t) 28,877 35,000 - 36,500 Grade mined (g/t) 1.98 1.40 - 1.60 Strip ratio waste/ore 3.9 7.00 - 7.75 Ore milled ('000t) 2,439 3,300 - 3,400 Head grade (g/t) 3.08 2.00 - 2.15 Recovery rate % 88.7 89.0 - 91.0 Gold produced (oz) 214,310 190,000 - 210,000 Gold sold (oz) 207,814 190,000 - 210,000 Total cash cost (incl. royalties)(1,2) $/oz sold 627 650 - 700 Total production cost(1) $/oz sold 850 950 - 1,000 Mining (cost/t mined) 2.71 2.50 - 2.70 Milling (cost/t milled) 20.39 19.00 - 20.00 G&A (cost/t milled) 6.16 5.00 - 6.00Mine production costs $ millions 145.8 170.0 - 180.0Capital Expenditures Mine site $ millions 52.9 20.0 - 25.0 Capitalized reserve development $ millions 26.1 5.0 - 10.0 Gora development costs Mobile equipment $ millions - 30.0 - 35.0 Site development $ millions 4.3 15.0 - 20.0 --------------------------------- Total Gora development costs $ millions 4.3 45.0 - 50.0 Capitalized deferred stripping(2) $ millions N/A 35.0 - 40.0 ---------------------------------Total Capital Expenditures $ millions 83.3 105.0 - 125.0 Exploration (expensed) $ millions 16.7 10.0 - 15.0 Administration expense $ millions 17.9 15.0 - 20.0 Hedge close-outs / deliveries (oz) 136,395 59,789(1) Total cash cost per ounce and total production cost per ounce are non- IFRS financial measures with no standard meaning under IFRS. For definitions of these metrics, please see page 26 of the Management Discussion and Analysis on www.terangagold.com.(2) For 2013, reflects the impact of adoption of a new IFRS standard for deferred stripping. Please see page 25 of the Management Discussion and Analysis on www.terangagold.com.



TERANGA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / LOSS

(US$000's, except per share amounts)

---------------------------------------------------------------------------- Twelve months Fifteen months ended ended ---------------- ---------------- December 31, December 31, 2012 2011----------------------------------------------------------------------------Revenue 350,520 236,873Cost of sales (179,323) (148,812) ---------------- ----------------Gross profit 171,197 88,061Exploration and evaluation expenditures (16,657) (31,659)Administration expenses (17,931) (13,448)Share based compensation (4,694) (12,411)Finance costs (7,789) (2,946)Losses on gold hedge contracts (15,274) (47,943)(Losses)/gains on oil hedge contracts (427) 2,203Net foreign exchange (losses)/gains (2,574) 4,486Impairment of available for sale financial asset (11,917) -Other income 36 848 ---------------- ---------------- (77,227) (100,870)Profit/(loss) before income tax 93,970 (12,809)Income tax benefit 115 92 ---------------- ----------------Profit/(loss) for the period 94,085 (12,717) ---------------- ----------------Profit/(loss) attributable to:Shareholders 79,924 (16,040)Non-controlling interests 14,161 3,323 ---------------- ----------------Profit/(loss) for the period 94,085 (12,717) ---------------- ----------------Other comprehensive income/(loss):Exchange differences arising on translation of Teranga corporate entity (63) (935)Change in fair value of available for sale financial asset, net of tax 6,775 (1,319) ---------------- ----------------Other comprehensive income/(loss) for the period 6,712 (2,254) ---------------- ----------------Total comprehensive income/(loss) for the period 100,797 (14,971) ---------------- ----------------Total comprehensive income/(loss) attributable to:Shareholders 86,636 (18,294)Non-controlling interests 14,161 3,323 ---------------- ----------------Total comprehensive income/(loss) for the period 100,797 (14,971) ---------------- ----------------Earnings/(losses) per share from operations attributable to the shareholders of the Company during the period- basic earnings/(losses) per share 0.33 (0.07)- diluted earnings/(losses) per share 0.33 (0.07)



TERANGA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

(US$000's)

---------------------------------------------------------------------------- As at December As at December 31, 2012 31, 2011----------------------------------------------------------------------------Current assetsCash and cash equivalents 39,722 7,470Short-term investments - 593Restricted cash - 3,004Trade and other receivables 6,482 20,447Inventories 82,474 48,365Financial derivative assets 456 2,288Other assets 12,896 12,751Available for sale financial assets 15,010 19,800 ---------------- ----------------Total current assets 157,040 114,718 ---------------- ----------------Non-current assetsInventories 40,659 31,942Financial derivative assets - 532Property, plant and equipment 241,838 238,510Mine development expenditures 109,060 89,825Intangible assets 1,859 1,085 ---------------- ----------------Total non-current assets 393,416 361,894 ---------------- ----------------Total assets 550,456 476,612 ---------------- ----------------Current liabilitiesTrade and other payables 44,823 43,238Borrowings 10,415 16,468Financial derivative liabilities 51,548 79,241Provisions 1,940 1,954 ---------------- ----------------Total current liabilities 108,726 140,901 ---------------- ----------------Non-current liabilitiesFinancial derivative liabilities - 50,318Provisions 10,312 9,215Borrowings 58,193 7,509 ---------------- ----------------Total non-current liabilities 68,505 67,042 ---------------- ----------------Total liabilities 177,231 207,943 ---------------- ----------------EquityIssued capital 305,412 305,412Foreign currency translation reserve (998) (935)Equity-settled share based compensation reserve 16,358 12,599Investment revaluation reserve 5,456 (1,319)Accumulated income/(loss) 36,549 (43,375) ---------------- ----------------Equity attributable to shareholders 362,777 272,382Non-controlling interests 10,448 (3,713) ---------------- ----------------Total equity 373,225 268,669 ---------------- ----------------Total equity and liabilities 550,456 476,612 ---------------- ----------------



TERANGA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(US$000's)

Twelve months Fifteen months ended ended December 31, December 31, 2012 2011----------------------------------------------------------------------------Issued capitalAt January 1, 2012 / October 1, 2010 305,412 Shares issued on incorporation of the Company - - Shares issued on the acquisition of the Sabodala gold mine and a regional exploration package - 186,665 Shares issued from public and private offerings - 135,005 Less: Share issue costs - (16,258)----------------------------------------------------------------------------At December 31 305,412 305,412----------------------------------------------------------------------------Foreign currency translation reserveAt January 1, 2012 / October 1, 2010 (935) - Exchange difference arising on translation of Teranga corporate entity (63) (935)----------------------------------------------------------------------------At December 31 (998) (935)----------------------------------------------------------------------------Equity-settled share based compensation reserveAt January 1, 2012 / October 1, 2010 12,599 - Equity-settled share based compensation reserve 3,759 12,599----------------------------------------------------------------------------At December 31 16,358 12,599----------------------------------------------------------------------------Investment revaluation reserveAt January 1, 2012 / October 1, 2010 (1,319) - Impairment of available for sale financial asset 1,319 - Change in fair value of available for sale financial asset, net of tax 5,456 (1,319)----------------------------------------------------------------------------At December 31 5,456 (1,319)----------------------------------------------------------------------------Accumulated income/(loss)At January 1, 2012 / October 1, 2010 (43,375) - Profit/(Loss) attributable to shareholders 79,924 (16,040) Impact of change in accounting policy - (27,335)----------------------------------------------------------------------------At December 31 36,549 (43,375)----------------------------------------------------------------------------Non-controlling interestAt January 1, 2012 / October 1, 2010 (3,713) - Non-controlling interest arising from demerger - November 23, 2010 - (7,036) Non-controlling interest - portion of profit for the period 14,161 3,323----------------------------------------------------------------------------At December 31 10,448 (3,713)----------------------------------------------------------------------------Total shareholders' equity at December 31 373,225 268,669----------------------------------------------------------------------------



TERANGA GOLD CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOW

(US$000's)

---------------------------------------------------------------------------- Twelve months Fifteen months ended ended ---------------- --------------- December 31, December 31, 2012 2011----------------------------------------------------------------------------Cash flows related to operating activitiesProfit/(loss) for the period 94,085 (12,717)Depreciation of property, plant and equipment 41,999 29,541Depreciation of capitalized mine development costs 11,142 10,200Amortization of intangibles 650 490Amortization of borrowing costs 877 328Unwinding of discount 53 47Share based compensation 3,759 12,411Net change in losses on gold hedge (39,010) (1,789)Net change in losses on oil hedge 2,364 113Buyback of gold hedge sales contracts (39,000) -Income tax paid - (638)Mine restoration and rehabilitation provision - 425Deferred income tax benefit on reversal of temporary differences - (231)Impairment of available for sale financial asset 11,917 -Profit on disposal of property, plant and equipment (131) -Changes in working capital (16,256) (33,048)----------------------------------------------------------------------------Net cash provided by operating activities 72,449 5,132Cash flows related to investing activitiesDecrease/(Increase) in restricted cash 3,004 (3,004)Redemption of short-term investments 593 181Expenditures for property, plant and equipment (51,451) (60,825)Expenditures for mine development (30,377) (14,359)Acquisition of intangibles (1,424) (1,208)Proceeds on disposal of property, plant and equipment 195 -Payment for acquisition of Sabodala gold mine and regional land package net of cash acquired - (34,307)----------------------------------------------------------------------------Net cash used in investing activities (79,460) (113,522)Cash flows related to financing activitiesProceeds from issuance of capital stock, net of issue costs - 118,747Loan facility, net of borrowing cost paid 57,695 -Repayment of borrowings (16,799) (10,849)Drawdown from finance lease facility, net of financing cost paid 2,857 9,612Interest paid on borrowings (4,075) (2,248)----------------------------------------------------------------------------Net cash provided by financing activities 39,678 115,262Effect of exchange rates on cash holdings in foreign currencies (415) 598----------------------------------------------------------------------------Net increase in cash and cash equivalents held 32,252 7,470Cash and cash equivalents at the beginning of financial period 7,470 -----------------------------------------------------------------------------Cash and cash equivalents at the end of financial period 39,722 7,470----------------------------------------------------------------------------CORPORATE DIRECTORYDirectorsAlan Hill, Executive ChairmanRichard Young, President and CEOChristopher Lattanzi, Non-Executive DirectorOliver Lennox-King, Non-Executive DirectorAlan Thomas, Non-Executive DirectorFrank Wheatley, Non-Executive DirectorSenior ManagementAlan Hill, Executive ChairmanRichard Young, President and CEOMark English, Vice President, Sabodala OperationsPaul Chawrun, Vice President, Technical ServicesNavin Dyal, Vice President and CFODavid Savarie, Vice President, General Counsel & Corporate SecretaryKathy Sipos, Vice President, Investor & Stakeholder RelationsMacoumba Diop, General Manager and Government Relations Manager, SGORegistered Office121 King Street West, Suite 2600Toronto, Ontario, M5H 3T9, CanadaT: +1 416-594-0000F: +1 416-594-0088E: generalmailbox@terangagold.comW: www.terangagold.comSenegal Office2K PlazaSuite B4, 1er Etagesis la Route due Meridien PresidentDakar AlmadiesT: +221 338 693 181F: +221 338 603 683AuditorDeloitte & Touche LLPShare RegistriesCanada: Computershare Trust Company of CanadaT: +1 800 564 6253Australia: Computershare Investor Services Pty LtdT: 1 300 850 505Stock Exchange ListingsToronto Stock Exchange, TSX symbol: TGZAustralian Securities Exchange, ASX symbol: TGZ



Non-IFRS Financial Measures

The Company provides some non-IFRS measures as supplementary information that management believes may be useful to investors to explain Teranga's financial results.

"Average realized price" is a financial measure with no standard meaning under IFRS. Management uses this measure to better understand the price realized in each reporting period for gold and silver sales. Average realized price excludes from revenues unrealized gains and losses on non-hedge derivative contracts. The average realized price is intended to provide additional information only and does not have any standardized definition under IFRS; it should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate this measure differently.

"Total cash cost per ounce sold" is a common financial performance measure in the gold mining industry but has no standard meaning under IFRS. The Company reports total cash costs on a sales basis. We believe that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The measure, along with sales, is considered to be a key indicator of a Company's ability to generate operating earnings and cash flow from its mining operations.

Total cash costs figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is considered the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measure of other companies.

"Total depreciation and amortization per ounce sold" is a common financial performance measure in the gold mining industry but has no standard meaning under IFRS. It is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

FORWARD LOOKING STATEMENTS

Certain information included in this announcement, including any information as to the Company's strategy, projects, exploration programs, joint venture ownership positions, plans, future financial or operating performance and other statements that express management's expectations or estimates of future performance, constitute "forward-looking statements". The words "believe", "expect", "will", "intend", "anticipate", "project", "plan", "estimate", "on track" and similar expressions identify forward looking statements. Such forward-looking statements are necessarily based upon a number of estimates, assumptions, opinions and analysis made by management in light of its experience that, while considered reasonable, may turn out to be incorrect and involve known and unknown risks, uncertainties and other factors, in each case that may cause the actual financial results, performance or achievements of the Company to be materially different from the Company's estimated future results, performance or achievements expressed or implied by those forward-looking statements. Such forward-looking statements are not guarantees of future performance. These assumptions, risks, uncertainties and other factors include, but are not limited to: assumptions regarding general business and economic conditions; conditions in financial markets and the future financial performance of the company;

the impact of global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future cash flows; the supply and demand for, deliveries of, and the level and volatility of the worldwide price of gold or certain other commodities (such as silver, fuel and electricity); fluctuations in currency markets, including changes in U.S. dollar and CFA Franc interest rates; risks arising from holding derivative instruments; adverse changes in our credit rating; level of indebtedness and liquidity; ability to successfully complete announced transactions and integrate acquired assets; legislative, political or economic developments in the jurisdictions in which the Company carries on business; operating or technical difficulties in connection with mining or development activities; employee relations; availability and costs associated with mining inputs and labor; the speculative nature of exploration and development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves; changes in costs and estimates associated with our projects; the accuracy of our reserve estimates (including with respect to size, grade and recoverability) and the geological, operational and price assumptions on which these are based; contests over title to properties, particularly title to undeveloped properties; the risks involved in the exploration, development and mining business, as well as other risks and uncertainties which are more fully described in the Company's A.I.F. and in other Company filings with securities and regulatory authorities which are available at www.sedar.com. 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 Report relating to the mineral reserve estimates within the Sabodala, Sutuba, Niakafiri and Gora deposits and the Stockpiles, is based on information compiled by Julia Martin, P.Eng., MAusIMM (CP), a full time employee with AMC Mining Consultants (Canada) Ltd., is independent of Teranga, is a "qualified person" as defined in NI 43-101 and a "competent person" as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Martin has sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms Martin has reviewed and accepts responsibility for the reserve estimates disclosed above. Ms Martin has consented to the inclusion in the report of the matters based on her information in the form and context in which it appears in this Report.

The technical information contained in this Report relating to the mineral resources is based on information compiled by Ms. Patti Nakai-Lajoie, who is a Member of the Association of Professional Geoscientists of Ontario. Ms. Patti Nakai-Lajoie is full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Ms. Patti Nakai-Lajoie has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Patti Nakai-Lajoie is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects and she consents to the inclusion in the report of the matters based on her information in the form and context in which it appears in this Report.

The technical information contained in this Report relating to exploration results is based on information compiled by Mr. Martin Pawlitschek, who is a Member of the Australian Institute of Geoscientists. Mr. Pawlitschek is a consultant of Teranga and is not "independent" within the meaning of National Instrument 43-101. Mr. Pawlitschek has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Pawlitschek is a "Qualified Person" in accordance with NI 43-101 and he consents to the inclusion in the report of the matters based on his information in the form and context in which it appears in this Report.

(1) Total cash costs per ounce sold is a common financial performance measure in the gold mining industry but has no standard meaning under IFRS.

(2) This production target is based on proven and probable reserves only.



Contacts:
Teranga Gold Corporation
Kathy Sipos
Vice-President, Investor & Stakeholder Relations
+1 416-594-0000
ksipos@terangagold.com
www.terangagold.com



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