Development of Omagh GOLD MINE ON Hold

GALANTAS GOLD CORPORATION

TSXV – AIM “GAL”

DEVELOPMENT OF OMAGH GOLD MINE ON HOLD

24th April 2017 Galantas Gold Corporation (“Galantas” or the “Company”) has received notification

that the Police Service of Northern Ireland (“PSNI”) will not provide its required anti-terrorism cover

in regard to blasting operations required for mine development at the Omagh Gold Mine.

The PSNI requires that it supervises transportation and use of certain rock breaking materials and

explosives at the Omagh Gold Mine. This is due to the potential terrorist use of those materials and

is a requirement of PSNI specific to Northern Ireland. The PSNI provide anti-terrorist cover for the

transportation and use of blasting materials throughout Northern Ireland. Explosives are widely used

in quarries and one other operating underground mine. The Company understands that no charges

are made to the quarries or the other operating underground mine in Northern Ireland for PSNI anti-

terrorism cover.

The Company has been told that, due to PSNI resource constraints and competing priorities, PSNI is

currently only prepared to provide anti-terrorism cover for a maximum of a 2 hour period, 2 days per

week. It will also require a cost recovery agreement. Two, 2 hour periods per week is insufficient to

sustain the development or operation of the Omagh Gold Mine.

The Company disagreed with the principle of costs recovery for anti-terrorism policing but advised

PSNI that the Company was prepared to enter into a costs recovery agreement, without prejudice to

its legal remedies in that respect, for a 2 hour period, 5 days per week. Although PSNI provided the

costs analysis for the 5 day and 2 hour period anti-terrorism cover, which was agreed without

prejudice, the PSNI has refused to provide the cover, citing competing priorities. The Company has

been advised that others have recently been provided in excess of this amount of anti-terrorism

cover and without a cost recovery agreement. The Company has sought to discuss the issue at the

highest levels of command in PSNI and the Northern Ireland Office but engagement has so far been

declined.

The Company whole-heartedly supports PSNI and its officers in its laudable objective of maintaining

peace, law and order in Northern Ireland in difficult circumstances. However, the Company believes

it is improper of PSNI to act in a discriminatory manner against a lawful business. The Company has

been given no alternative other than to pursue its legal options, which may include seeking

substantial compensation for the costs of delays.

The Omagh Gold Mine has an operational processing plant and tailings facility with an excellent

environmental record. The plant uses a non-toxic, froth flotation process, without the use of cyanide

or mercury and produces a gold concentrate which is exported for smelting. The remaining tailing

sands are clean and free from acid drainage. The plant is on stand-by awaiting ore from underground

development. The underground mine development expected to create 130 jobs plus others in

service industries associated with the development.

Discussions, in regard to potential redundancies, with mine personnel recently hired for the

development, are taking place. New hiring and the current investment program has been deferred.

Roland Phelps, President & CEO, Galantas Gold Corporation said, “The PSNI’s decision is clearly a

blow to any proposed mine development in Northern Ireland and negatively affects the livelihoods

of our employees and their families. The Company pays full UK taxes, royalties and mineral license

fees. A cost benefit analysis of PSNI providing the required anti-terrorism cover required by PSNI is

hugely to the state’s benefit - not that this is any reason to allow a potential terrorist threat to

interfere with any citizen’s lawful rights or business.”

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the

policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this

release.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No

596/2014.

Enquiries : Galantas Gold Corporation

L. Jack Gunter P.Eng – Chairman, Roland Phelps C.Eng – President & CEO

Email: [email protected] Telephone: (UK) +44 (0) 2882 241100

Website: www.galantas.com

Grant Thornton UK LLP (Nomad)

Philip Secrett, Richard Tonthat: Telephone: +44(0)20 7383 5100

Whitman Howard Ltd (Broker & Corporate Adviser)

Nick Lovering, Grant Barker: Telephone: +44(0)20 7659 1234