Mr. Ewan Downie reports

PREMIER PROVIDES UPDATE OF CURRENT RESERVES & RESOURCES AT MERCEDES

Premier Gold Mines Ltd. is confirming a current mineral reserve and resource estimate for the company's 100-per-cent-owned Mercedes mine, located in the state of Sonora, Mexico, approximately 65 kilometres southeast of Magdalena de Kino. The estimate, completed by the Mercedes mine personnel (with an effective date of June 30, 2016), is documented in an independent technical report completed on behalf of Premier by Roscoe Postle Associates Inc.

The first attached table provides a summary of the mineral reserves at the Mercedes mine, while the second attached table provides a summary of mineral resources.

Highlights of the June 30, 2016, Mercedes estimate include:

• Proven and probable reserves exceed 400,000 ounces gold, a 21-per-cent increase from 2015 net of depletion;
• Proven reserve grade exceeds six grams per tonne gold;
• Measured and indicated resources of 382,000 ounces of gold and 4.4 million ounces of silver;
• Measured and indicated resource grade has increased 23 per cent to 4.14 grams per tonne gold.

"A renewed focus on reserve and resource definition at Mercedes has resulted in a 20-per-cent increase in proven and probable reserves between December and June. This is a result of excellent work by the professional management team at site," commented Premier president and chief executive officer Ewan Downie. "Premier is now in place as a fully engaged mine operator, and we will continue to seek to grow reserves and resources by maintaining an aggressive exploration and development effort."

               2016 MERCEDES MINE MINERAL RESERVE SUMMARY -- JUNE 30, 2016   
   
                  Category/    Tonnes      Gold (Au)   Contained Au    Silver (Ag)   Contained Ag
Deposit       process type    (000s t)   grade (g/t)       (000s oz)   grade (g/t)       (000s oz)

Mercedes            Proven        509          6.02           99           51.5            842     
              Probable (UG)     2,174          4.13          289           33.9          2,369
              Probable (OP)       229          2.15           16           17.4            128
                                -----          ----          ---           ----          -----  
           Probable (total)     2,404          3.95          305           32.3          2,497 
                                -----          ----          ---           ----          ----- 
                Proven and
                  probable      2,913          4.31          403           35.7          3,339
                                =====          ====          ===           ====          =====      

(1) CIM (Canadian Institute of Mining, Metallurgy and Petroleum) definitions were followed for
mineral reserves.
(2) Mineral reserves are estimated at a cut-off grade of three grams per tonne Au for underground
reserves and 1.55 grams per tonne Au for open-pit reserves.
(3) Mineral reserves were estimated using an average gold price of $1,150 (U.S.) per ounce and a
silver price of $18 (U.S.) per ounce.  
(4) A minimum mining width of 2.5 metres was used.                                     
(5) Bulk density is 2.42 tonnes per cubic metre for ore and 2.44 tonnes per cubic metre for
waste.                                                                      
(6) Numbers may not add due to rounding.                                                                                             

          2016 MINERAL RESOURCE ESTIMATE EXCLUSIVE OF MINERAL RESERVES (JUNE 30, 2016)
  
                   Resource     Tonnes      Gold (Au)   Contained Au    Silver (Ag)   Contained Ag
Deposit            category    (000s t)   grade (g/t)       (000s oz)   grade (g/t)       (000s oz)

Mercedes           Measured        522          4.98            83.6            65           1,085
                  Indicated      2,344          3.96           298.3            45           3,355
                                 -----          ----           -----            --           ----- 
               Measured and
           indicated (total)     2,866          4.14           381.9            48           4,440
                                 -----          ----           -----            --           ----- 
             Total inferred      1,220           4.6             180            33           1,300

(1) CIM definitions were followed for mineral resources.
(2) Mineral resources are estimated at a cut-off grade of two grams per tonne gold equivalent for
underground resources and 0.4 gram per tonne AuEq for open-pit resources.
(3) AuEq based on one gram Au equal to 140 grams Ag. 
(4) Mineral resources were estimated using an average gold price of $1,600 (U.S.) per ounce.  
(5) No minimum mining width was used.                                                      
(6) Bulk density is 2.42 tonnes per cubic metre for ore and 2.44 tonnes per cubic metre for waste.  
(7) Mineral resources are exclusive of mineral reserves.
(8) Numbers may not add due to rounding.

The mineral reserve and resource estimate used the CIM definition standards for mineral resources and mineral reserves, definitions and guidelines prepared by the CIM standing committee on reserve definitions and adopted by the CIM council on May 10, 2014. The mineral resource estimate is classified as measured, indicated or inferred as defined by CIM.

The report, "Technical report on the Mercedes gold-silver mine, Sonora state, Mexico," was completed by qualified persons Kathleen A. Altman, PE, Stuart E. Collins, PE, and Chester M. Moore, PEng, and has been filed on SEDAR and on the company's website. The key assumptions and parameters used in the estimate of the mineral reserves and mineral resources presented in this press release are set out in such technical report.

Mr. Moore is the independent qualified person who has reviewed and approved the contents of this press release for the purposes of National Instrument 43-101.

Premier Gold Mines is a respected production, exploration and development company with a high-quality pipeline of gold projects focused in proven, safe, and accessible mining jurisdictions in Canada, the United States and Mexico. Anticipated gold production in excess of 100,000 ounces during the final quarter of 2016 will come from its interest in the South Arturo mine in Nevada and the recently acquired Mercedes mine in Mexico.

We seek Safe Harbor.