Ms. Maria Consuelo Araujo reports

GRAN COLOMBIA GOLD ANNOUNCES 2011 YEAR END RESULTS, GROWING PRODUCTION TO OVER 91,000 OUNCES OF GOLD

Gran Colombia Gold Corp. has issued its audited consolidated financial results for 2011 fiscal year. All financial figures contained herein are expressed in United States dollars unless otherwise noted.

Fourth quarter 2011 highlights

• Gold production of 26,979 ounces, a 24-per-cent increase from 21,737 ounces in the third quarter of 2011;
• Revenues of $50.4-million, an increase of 30 per cent over the third quarter of 2011;
• Cash margin increased to $574 per ounce of gold sold in the quarter;
• Gross margin of $13.2-million, reflecting the benefit of the first full quarter of cost savings at the Segovia operations after its work-force reduction in September and reduction in its cash cost per ounce to $1,128;
• Net income of $1.7-million, the first quarterly profit in the company's history.

Full year 2011 highlights

• Gold production of 91,419 ounces, meeting guidance;
• Revenue of $137.7-million from the sale of 83,809 ounces of gold at an average realized price of $1,596 per ounce;
• Gross margin of $11.5-million, a $14.4-million improvement over 2010;
• Net loss of $34.8-million, 11 cents per share, including $22.8-million of one-time charges related to the Colombian equity tax, Medoro acquisition costs and silver notes issuance costs;
• Cash position of $20.3-million as at Dec. 31, 2011;
• Gold resources (measured and indicated), for the Segovia operations and Marmato project increased by 76 per cent and 51 per cent, respectively, in 2011.

Commenting on the company's performance in 2011, Maria Consuelo Araujo, chief executive officer of the company, said: "Two thousand eleven was a very important year for the company. We ended the year as the largest gold producer in Colombia. Our efforts at our Segovia operations have yielded significant cost savings and production growth. With our investment to increase our capacity at the Maria Dama plant in the second quarter of 2012, we expect to almost double our gold production in 2012."

        SUMMARY OF THE FINANCIAL AND OPERATING RESULTS FOR THE FOURTH QUARTER
                         AND FULL YEAR ENDED DEC. 31, 2011

                                                  Fourth quarter             Full year
                                                  2011      2010      2011        2010 (1)
Operating data                                                                 
Gold produced (ounces)                          26,979    12,522    81,480 (2)  14,509
Gold sold (ounces)                              29,185    12,527    83,809      14,071
Average realized gold price 
(per ounce sold)                              $  1,687  $  1,401  $  1,596    $  1,385
Total cash costs (per ounce sold) (3)            1,113     1,251     1,254       1,295
Financial data 
(thousands except per share amounts)                              
Total revenues                                $ 50,425  $ 17,984  $137,713    $ 20,170
Gross margin                                    13,157      (919)   11,453      (2,947)
Net income (loss) attributable to shareholders   1,673    (4,818)  (34,813)    (39,013)
Basic and diluted income (loss) per share         0.00     (0.25)    (0.11)      (0.43)

(1) Represents period from incorporation on Jan. 4, 2010, to Dec. 31, 2010.            
(2) Excludes 9,939 ounces produced by Medoro prior to the merger on June 10, 2011.     
(3) Total cash costs are presented on a per-ounce-sold basis and represent consolidated
    averages for the company from both the Segovia operations and Marmato Underground.

Resources

In September, 2011, Gran Colombia announced a 51-per-cent increase in measured and indicated gold resources to 10 million ounces at its Marmato project, with 1.9 million ounces of gold in the measured category and 8.1 million ounces of gold in the indicated category. In addition, there are an estimated 64 million ounces of silver in the measured and indicated categories, with 16 million ounces of silver in the measured category and 48 million ounces of silver in the indicated category. The company filed a National Instrument 43-101 mineral resource estimate on Oct. 19, 2011, for its Marmato project.

In March, 2012, Gran Colombia announced a new mineral resource estimate for its Segovia operations representing a 76-per-cent increase in measured and indicated gold resources. The resource estimate includes 233,000 ounces of gold in the measured and indicated categories, with 136,000 ounces of measured and 97,000 ounces of indicated resources. This is also an additional 1.1 million ounces of gold in the inferred category, at a cut-off grade of three grams per tonne. The company will file a National Instrument 43-101 report prepared by SRK Consulting (U.K.) Ltd. prior to April 12, 2012. This will be filed on the company's website and on SEDAR.

Production

Total gold production for the fourth quarter of 2011 increased 115 per cent compared with the fourth quarter of 2010 and 24 per cent compared with the third quarter of 2011, largely as a result of production growth at the Segovia operations, and the addition of production from the underground mine at Marmato following the company's merger with Medoro Resources Ltd. in June, 2011.

Cash costs in the fourth quarter of 2011

The company's consolidated cash cost decreased to $1,113 per ounce of gold, a $227-per-ounce improvement from the third quarter, in large part due to the steps taken in September, 2011, to significantly reduce its workforce costs at the Segovia operations. In 2011, the company initiated an expansion project at the Segovia operations to increase the mill capacity at the Maria Dama plant, initially to 1,000 tonnes per day by the end of the second quarter of 2012 and then to 1,500 tonnes per day by the end of 2012. This initiative, coupled with planned increases in the mining rates and a $15-million internally funded capital program at Segovia in 2012, will enable the company to lower its cash cost per ounce at the Segovia operations below $1,000 in 2012.

Net income (loss)

The company reported its first quarterly net income attributed to shareholders of $1.7-million or zero cent per share in the fourth quarter of 2011, driven by the increase in gross margin to $13.2-million resulting from increased gold sales and the cash cost improvements at the Segovia operations.

For the full year 2011, the company recorded a net loss attributed to shareholders of $34.8-million, or 11 cents per share, which included $22.8-million of one-time charges related to the Colombian equity tax, Medoro acquisition costs and silver notes issuance costs.

Segovia operations

Gran Colombia is in the process of expanding capacity and increasing production at its Segovia operations. The new ball mill is in the final stages of installation and after initial testing in April at a 600-tonne-per-day rate, the daily mill rates will be steadily increased until it reaches a rate of 1,000 tonnes per day in June. This will be almost double the average milling rate of 517 tonnes per day in 2011. By late 2012, following improvements in other areas of the Maria Dama plant operation, the company expects that it will further increase the mill's capacity to 1,500 tonnes per day.

Marmato project

Gran Colombia is currently completing a prefeasibility study at its Marmato project to identify and evaluate its options for the development of mining operations in the future, including underground, open pit and combined underground/open pit scenarios. This study is nearing completion and the company expects to have this available for decision making in the second quarter of 2012. Once the company has decided which route it will take, it will then proceed to the feasibility study stage. In conjunction with these activities, the company will begin evaluating its options for debt financing for the development of the Marmato project.

Addressing the Marmato project, Ms. Araujo said: "In 2011, our focus at the Marmato project was on building the necessary foundations for our planned development. We completed a new resource estimate, increasing our measured and indicated gold resources by 51 per cent, and worked with the community to better understand their needs to help us implement socially based programs to improve the quality of life in our community. We remain very engaged with the Marmato community regarding the resettlement process, working in strict accordance with international standards. We look forward to providing an update on our progress as we complete our prefeasibility study in the second quarter."

Standard Bank loan facility

On Dec. 20, 2011, the company announced that it had signed an exclusive mandate letter with Standard Bank PLC for the arrangement of a $100-million senior secured term loan facility to fund its plan to develop a new mechanized mining operation and to acquire a new 2,500 tonnes per day mill at its Segovia operations. The company initially expected that the Standard Bank loan facility would close at the end of January, 2012. However, the due diligence activities, some of which are being performed on behalf of Standard Bank by third party technical consultants, are taking longer than both the bank and the company initially expected. These due diligence activities include the completion of technical studies, such as a preliminary economic assessment of the mineral resource estimate announced in March, 2012, and environmental due diligence in conjunction with the filing of an environmental management plan with the local environmental authority in April, 2012. The company and Standard Bank continue to work together in anticipation of a successful closing of the loan facility as soon as the due diligence process is concluded. As the existing Maria Dama plant expansion is fully funded from existing cash balances and operating cash flow, any delay in closing the Standard Bank loan facility will not impact the company's ability to increase gold production at the Segovia operations in 2012 as planned.

Outlook

The company expects 2012 gold production to be approximately 155,000 ounces as a result of the increased processing capacity at its Segovia operations. Production at its Segovia operations is expected to reach 130,000 ounces of gold in 2012 and production from the underground mine at Marmato is expected to total approximately 25,000 ounces of gold.

Capital expenditures for 2012, to be funded from cash balances and operating cash flow, include a $15-million capital program at the Segovia operations to complete the mill expansion, add additional mining equipment for the existing underground mining operations, construct a laboratory on-site to improve sampling procedures in the production process, construct additional tailings facilities, and a total of approximately $23-million in connection with the prefeasibility study, social programs, environmental studies, and mining titles at the Marmato project.

The company's exploration program for 2012, also to be internally funded from cash flow from operations, includes a $13-million 51,000-metre diamond drilling program that will get under way at the Segovia operations in April, a $3-million drilling campaign at the Marmato project that is nearing completion and a $1.5-million exploration program at the company's Zancudo project.

Webcast

As a reminder, the company will host a conference call and webcast on March 30, 2012, at 9 a.m. Eastern Time (8 a.m. Bogota time) to discuss the results and provide an operational update.

Webcast and call-in details are as follows:

Toronto and international:  847-585-4405

North America toll-free:  888-771-4371

Colombia toll-free:   01-800-9-156-924

Conference ID:  32105223

A replay of the webcast will be available on the company's website from March 30, 2012, until April 30, 2012.

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