Mr. Edward Dowling reports

ALACER GOLD COMMITS TO NEXT STAGE OF EXPANDING SOUTH KALGOORLIE OPERATIONS AS RESERVE INCREASES 96% TO 761,000 OUNCES

Alacer Gold Corp.'s board of directors has approved a $25-million (Australian) budget for the first stage of expanding the South Kalgoorlie operations. This approval to proceed will finance continuing underground mining feasibility work, ordering long-lead-time items for a new 2.5-million-tonne-per-annum treatment plant and proceeding with cutbacks of the HBJ North and Mount Martin open pits.

Highlights:

• Alacer's staged development approach minimizes financial and technical risk while enabling rapid progress toward bringing to account the substantial resource and exploration option value at South Kalgoorlie.
• It is envisaged that a new 2.5-million-tonne-per-annum South Kalgoorlie processing facility, replacing the existing 1.2-million-tonne-per-annum Jubilee plant, will be commissioned in early 2013 and will become a treatment hub for ore from various open pit and underground mines from within the 100-per-cent-owned South Kalgoorlie tenements as well as the Frog's Leg mine (owned 49 per cent by Alacer).
• The new mineral reserve at South Kalgoorlie of 13.1 million tonnes at 1.8 grams per tonne gold containing 761,000 ounces includes the increased HBJ north open pit reserve (391,000 ounces) plus the Mount Martin, Pernatty and Triumph open pit reserves (together, 124,000 ounces), and Alacer's 49-per-cent interest in Frog's Leg (246,000 ounces). This reserve does not include HBJ or Mount Marion resources which are potentially minable through underground methods and are the subject of continuing mining feasibility studies with conversion of Stage 1 underground reserves expected to be announced in the second quarter of 2012.
• The new South Kalgoorlie mineral reserve of 761,000 ounces represents a 96-per-cent increase over the previously published reserve of 389,000 ounces and takes into account mining depletion of 164,000 ounces subsequent to the release of the previous reserves.
• The preferred approach to mining the large HBJ lode is to mine the northern portion through an expanded open pit and the southern portion through underground bulk-mining methods.
• South Kalgoorlie exploration and mining tenements contain gold resources totaling five million ounces of gold.
• Following the completion of continuing underground feasibility studies by the end of the first quarter of 2012, the board of directors will consider proceeding with the South Kalgoorlie expansion project, including the construction of a new 2.5-million-tonne-per-annum processing plant.

Edward Dowling, president and chief executive officer of Alacer, stated: "We are systematically and prudently progressing South Kalgoorlie toward reaching its targeted gold production of 200,000 ounces per annum -- an important part of our goal of becoming an 800,000-ounce gold producer by 2015. South Kalgoorlie is located in a prolific and extremely well-endowed, but underexplored, gold district that we believe will yield further significant gold discoveries. We are working toward building a larger treatment facility that will provide a cost-effective basis for processing known resources and new discoveries in a manner that creates substantial shareholder value over time."

South Kalgoorlie vision

The 25-year-plus-old Jubilee plant at South Kalgoorlie currently treats ore from the company's HBJ mine and its 49-per-cent interest in the Frog's Leg mine. With Jubilee's processing capacity of approximately 1.2 million tonnes per annum, South Kalgoorlie currently produces approximately 100,000 ounces of gold per annum.

The South Kalgoorlie expansion project targets doubling gold production by developing a multimine treatment hub that processes 2.5 million tonnes per annum of ore grading about 2.5 g/t gold, producing approximately 200,000 ounces per annum and targeting a cash cost of about $600 per ounce. The mix of ore would vary as exploration of Alacer's large South Kalgoorlie tenements progresses over time and mining studies are completed on various resources. Alacer is evaluating various scenarios to increase and optimize South Kalgoorlie gold production. The initial ore mix for plant commissioning in early 2013 is currently estimated to be 1.5 million tonnes per annum from the HBJ lode, 400,000 tonnes per annum from Frog's Leg mine and 600,000 tonnes per annum from other mines.

The approved $25-million (Australian) budget is for work over the next six months on the South Kalgoorlie expansion project and includes:

• Recommencement of open pit mining at the Mount Martin mine, recently acquired by Alacer;
• Recommencement of open pit mining at the Triumph mine;
• Recommencement of open pit mining at the Pernatty mine;
• Commencement of a significant cutback in the north end of the HBJ open pit;
• A definitive feasibility study for Stage 1 of the HBJ underground mine (southern portion of HBJ deposit);
• A definitive feasibility study for Stage 1 of the Mount Marion West underground mine;
• A definitive feasibility study for Shirl underground and open pit mines;
• Commitment to proceed with power upgrades and purchase of long-lead-time items required for a new 2.5-million-tonne-per-annum plant.

Preferred approach to mining the HBJ deposit

Several different scenarios for mining the large three-million-ounce (measured and indicated) resource at HBJ have been assessed. Given that the company's preferred approach is to maximize value and reduce risk, it has been decided to mine the resource through:

• An open pit for the northern portion of the HBJ lode;
• A large underground bulk-mining operation for the central and southern portions of the HBJ lode.

This approach allows earlier mining of the higher-grade mineralization in the south, thereby providing a better economic return as well as eliminating the potential geotechnical risk associated with a large open pit cutback of the southern end. Another benefit of underground mining the central and southern areas is that waste from the northern open pit can be dumped in the southern end of the existing open pit rather than being hauled to the surface waste dump. This in-pit dumping will reduce haulage costs associated with waste removal.

New South Kalgoorlie reserve

Following the completion of feasibility studies for several open pits, the new South Kalgoorlie reserve (inclusive of Alacer's 49-per-cent interest in Frog's Leg) is 13.1 million tonnes at 1.8 g/t gold containing 761,000 ounces, all in the probable category.

      MINERAL RESERVES FOR THE SOUTH KALGOORLIE OPERATIONS 
                      AS AT AUG. 31, 2011

                   Lower cut-off   Tonnes   Au grade   Au ounces
Asset/project        grade (g/t)     (kt)      (g/t)       (koz)

HBJ                         0.45    9,600        1.3         391      
Mount Martin                0.60    1,250        1.9          77       
Pernatty                    0.60      304        2.2          22       
Triumph                     0.60      424        1.8          25       
Total open pits                    11,578        1.4         515      
Frog's Leg (49%)            3.10    1,500        5.1         246      
Total                              13,078        1.8         761      

Note: The Frog's Leg (49 per cent) mineral reserve is the Dec. 
      31, 2010, mineral reserve adjusted for production ounces 
      up to the end of August, 2011. Rounding differences will 
      occur.

Production ounces mined from the South Kalgoorlie open pits and Frog's Leg subsequent to the previously published mineral reserve of 389,000 ounces total 164,000 ounces, comprising 77,000 ounces from the South Kalgoorlie open pits and 87,000 ounces from Frog's Leg (at 49 per cent).

The increase in mineral reserves from the previous 389,000 ounces to the current 761,000 ounces represents a 96-per-cent increase in published reserves at South Kalgoorlie. If mined ounces are added to this calculation, the increase from 389,000 ounces to 925,000 ounces (761,000 ounces plus 164,000 ounces) represents a 138-per-cent increase in reserve ounces since the previously published reserve.

It is anticipated that when the board considers proceeding with the full South Kalgoorlie expansion project during the second quarter of 2012, the South Kalgoorlie reserve will have increased further to include the Stage 1 HBJ underground mining reserve at HBJ and the Stage 1 underground mining reserve at Mount Marion West.

Extensive South Kalgoorlie resources

The previously published resource inventory at South Kalgoorlie (inclusive of Alacer's 49-per-cent interest in Frog's Leg) is 71.4 million tonnes at 2.2 g/t gold containing five million ounces. None of the 25 deposits within the field has been closed off by drilling and continuing optimization studies continue to assess the individual resources for mining scenarios at different throughput rates and mining sequences.

The HBJ deposit is the largest South Kalgoorlie resource and makes up approximately 60 per cent of the South Kalgoorlie resource base. It represents one of the highest-endowed gold lodes in the Western Australian goldfields. HBJ has produced more than 1.6 million ounces of gold over the past 20 years, and is known to be consistently mineralized over a strike length of more than 2.3 kilometres and is locally up to 50 metres wide. The lode has up to 10,000 ounces per vertical metre where it is well drilled, however, large portions remain poorly drilled due to historically fragmented ownership, and very limited drilling exists below 500 metres depth.

The Mount Marion deposit is the second-largest South Kalgoorlie resource. The resource to be assessed for Stage 2 Mount Marion underground totals 5.4 million tonnes at 3.5 g/t gold containing 608,000 ounces and lies below the previously mined part of the Mount Marion deposit. Alacer will commence Stage 2 underground mining feasibility studies beginning in the second quarter of 2012. A definitive feasibility study for Stage 1 of the Mount Marion underground is being carried out on the Mount Marion West deposit over the coming six months.

South Kalgoorlie operations exploration

Alacer controls approximately 60 per cent of the very highly endowed "Golden Triangle" located between Kalgoorlie, Coolgardie and Kambalda. Estimated resources (prior to mining) within the Kalgoorlie-Coolgardie-Kambalda Golden Triangle amount to approximately 100 million ounces of gold. Accordingly, Alacer's management is confident the South Kalgoorlie holding provides excellent optionality for additional exploration success.

The focus of Alacer Gold's $11-million 2011 exploration program on the South Kalgoorlie tenements has been testing for underground mining potential at HBJ and Mount Marion West, as well as testing for open pit mining potential at Shirl, part of the SBS28 complex near Coolgardie. The drilling programs have successfully defined underground mineralization at Mount Marion, the results of which are now the subject of the Stage 1 underground mining feasibility studies at Mount Marion, as described above. Drilling at HBJ has returned encouraging results, although it must be noted drilling at HBJ is being undertaken on widespread drilling centres. Previously released high-grade results from the Shirl deposit have been successfully followed up with recently received additional high-grade results, all of which will be the subject of open pit cutback studies for 2012 production. Drilling results from the various South Kalgoorlie prospects will be released in an exploration update in the first quarter of 2012.

South Kalgoorlie expansion project

The staged-development approach announced today enables further work to be carried out while minimizing financial risk and enabling the new treatment facility to potentially be commissioned in early 2013. Alacer will now proceed with procuring critical path items required for a new 2.5-million-tonne-per-annum plant, such as committing to power upgrades and equipment with long lead times.

Alacer has completed a definitive feasibility study on this new treatment facility and determined that 2.5-million-tonne-per-annum throughput is the optimal size for South Kalgoorlie given current reserves and resources. The facility is envisaged to be a standard carbon-in-leach plant, many of which have been built in Australia. The estimated cost of this new facility and associated infrastructure is approximately $100-million.

We seek Safe Harbor.