Mr. Patrick Balit reports

RED EAGLE MINING REPORTS Q3 2017 FINANCIAL RESULTS

Red Eagle Mining Corp. has released financial results for the three and nine months ending Sept. 30, 2017, and business highlights to date. All currency figures are in U.S. dollars.

• A new discovery was announced at the San Marcos zone at Red Eagle Mining's controlled public subsidiary Red Eagle Exploration Ltd.'s California gold project (news release dated Nov. 14, 2017). Mineralization has been mapped and sampled underground in multiple locations over a strike length of 750 metres and vertical distance of 350 metres. Highlights included 24.04 grams per tonne gold equivalent (AuEq) over 0.60 metre, 136.11 g/t AuEq over 0.20 metre, 16.13 g/t AuEq over 1.30 metres, 15.29 g/t AuEq over 1.00 metre and 34.13 g/t AuEq over 0.50 metre.
• New discoveries were announced at the Los Andes zone at Red Eagle Mining's controlled public subsidiary Red Eagle Exploration Ltd.'s California gold project (news release dated Sept. 26, 2017). Samples averaged 25.32 g/t AuEq over 0.39 metre at Mina Los Andes and 8.37 g/t Au, 1,081 g/t silver (22.38 g/t AuEq) and 0.88 per cent copper over 0.85 metre at Los Andes Sur.
• The company had continued success with the underground delineation drilling program at the San Ramon mine which continues to exceed expectations with many intercept grades significantly higher than the reserve grade of 5.2 g/t Au (news releases dated Aug. 1, 2017, and Sept. 18, 2017).
• The company had a greenfields exploration discovery of multiple parallel high-grade veins at the Santa Rosa gold project within five kilometres from the completed Santa Rosa mill (news release dated July 10, 2017).
• Initial sampling was announced from the Machuca zone at Red Eagle Mining's controlled public subsidiary Red Eagle Exploration Ltd.'s California gold project (news release dated June 28, 2017). Sampling encountered a higher-grade mineralized zone with a total strike length of 45 metres which is open in all directions. The average composite grades along the two-metre width of the drift were 9.8 g/t Au and 221.1 g/t Ag.
• The company closed a $30-million (Canadian) rights offering to finance the add-on backfill plant and to provide working capital before gold production resumes. Monthly repayment of the credit facility was deferred until April 1, 2018 (news releases dated June 26, 2017, June 29, 2017, and Aug. 11, 2017).
• The company acquired the high-grade California gold project through Red Eagle Mining's controlled public subsidiary Red Eagle Exploration Ltd. (news releases dated Feb. 15, 2017, and March 15, 2017).

Operations update

Mine development

Underground development at the San Ramon gold mine continues to advance according to plan with 1,756 metres completed in the third quarter, 438 metres in October and 4,493 metres completed year to date. Development has been primarily focused on secondary access ramps and advancing 16 attack ramps on levels minus 125, minus 150, minus 175 and minus 200 metres, measured from surface.

During September four of these attack ramps crossed the mineralized shear zone defining economic ore headings with channel sampling averaging 7.35 grams per tonne gold over an average stope width of three metres. During October four additional attack ramps crossed the shear zone. Development ore will continue to be mined and stockpiled.

Stope mining operations resumed in October with 4,373 tonnes at 6.09 grams per tonne gold mined and stockpiled. Prior to the anticipated mill start-up in January, 2018, Red Eagle Mining expects to have stockpiled 21,000 tonnes of ore. Upon completion, the additional development, infill drilling and backfill system will allow consistent production resulting in an estimated 50,000 ounces of gold produced during 2018.

Updated ground support, drilling and blasting procedures were successfully implemented following the recently completed geotechnical study that resulted in greatly improved ground conditions, lower costs and reduced dilution.

During October, twin primary ventilation fans were commissioned on top of the exhaust shaft providing 120,000 cubic feet per minute to the underground mine. Each fan can deliver 120,000 cubic feet per minute with one operating and one on standby.

Mill and add-on backfill plant

The mill processing facility commissioning is complete. The mill has demonstrated the ability to exceed the nameplate design throughput by 20 per cent, with the capability to process up to 1,200 tonnes per day.

Design of the proposed backfill plant was completed during October. Testing will continue through November. Construction is planned to commence before the end of the year and is expected to be completed during th first quarter of 2018.

Delineation drilling

The stope delineation underground drill program is continuing, utilizing increased access to the orebody from the mine development program. The program commenced in June, 2017, with two underground diamond drill rigs and a third rig added during August, 2017. As of Oct. 31, 2017, 10,015 metres have been drilled in 123 delineation holes with assays pending on holes SRDU-0044 to SRDU-0123. Highlights from the 43 underground stope delineation holes released to date (SRDU-0001 to SRDU-0043) include intersections:

• SRDU-0003 -- 0.60 m at 44.14 g/t Au from 45.10 m downhole;
• SRDU-0008 -- 2.25 m at 10.04 g/t Au from 82.20 m downhole;
• SRDU-0008 -- 4.75 m at 5.38 g/t Au from 97.80 m downhole (including 0.60 m at 27.30 g/t Au);
• SRDU-0010 -- 3.80 m at 5.35 g/t Au from 58.35 m downhole;
• SRDU-0011 -- 1.50 m at 25.92 g/t Au from 85.90 m downhole;
• SRDU-0019 -- 2.45 m at 36.93 g/t Au from 59.05 m downhole (including 0.50 m at 108.54 g/t Au);
• SRDU-0020 -- 1.60 m at 19.10 g/t Au from 87.40 m down hole;
• SRDU-0038 -- 1.35 m at 63.38 g/t Au from 29.80 m downhole;
• SRDU-0042 -- 0.50 m at 108.64 g/t Au from 56.70 m down hole.

Selected financial data

The selected financial data are derived from Red Eagle Mining's unaudited interim condensed consolidated financial statements for the three and nine months ended Sept. 30, 2017, as prepared in accordance with interim standards under international financial reporting standards (all amounts in thousands of dollars, except per-share amounts).

                                       For the three months ended            For the nine months ended
                                  Sept. 30, 2017   Sept. 30, 2016   Sept. 30, 2017      Sept. 30, 2016

Net loss                                  $5,010             $568          $11,940              $1,204
Comprehensive loss (income)                4,819              235           10,307                (291)
Basic and diluted
loss per share                              0.02             0.00             0.04                0.01


                                                              As at         As at
                                                     Sept. 30, 2017 Dec. 31, 2016

Cash and cash equivalents                                    $3,625        $4,202   
Total assets                                                153,547       122,020 
Total liabilities                                            84,456        84,591  
Shareholders' equity                                         69,091        37,429  
                                                                                   

For the three and nine months ended Sept. 30, 2017, Red Eagle Mining reported a net loss of $5-million (2016: $600,000) and $12-million (2016: $1.2-million), respectively. The net loss increased compared with the 2016 period primarily due to increased expenses associated with the ramp-up of the San Ramon gold mine and mill during the 2017 period, which also resulted in the increased values of total assets and shareholders' equity.

This press release should be read in conjunction with the unaudited interim condensed consolidated financial statements and management's discussion and analysis for the three and nine months ended Sept. 30, 2017. These documents can be found on Red Eagle Mining's website or profile at SEDAR.

The technical information contained in this news release has been reviewed and approved by Red Eagle Mining's vice-president of exploration, Jeff Toohey, PEng, who is a qualified person as defined under National Instrument 43-101.

About Red Eagle Mining Corp.

Red Eagle Mining is a gold producer focused on building shareholder value through acquiring, developing and operating gold projects in Colombia, a jurisdiction with prolific historical production but until recently limited modern exploration. Red Eagle Mining owns 100 per cent of the Santa Rosa gold project and controls Red Eagle Exploration Ltd., which owns 100 per cent of the Vetas gold project, California gold project and Santa Ana silver project, and is actively consolidating additional high-grade precious metal deposits in Colombia.

We seek Safe Harbor.