Mr. Steven Dean reports

ATLANTIC REPORTS Q1 2018 FINANCIAL RESULTS

Atlantic Gold Corp. has released its operational and financial results for the first quarter of 2018. The company's Moose River consolidated gold mine (MRC) produced 18,183 ounces (17,187 ounces sold in the quarter) at an all-in sustaining cost (AISC) of $751 per ounce ($586 (U.S.)). Commercial production at MRC was declared on March 1, 2018.

The company is on track to deliver on its annual guidance of producing 82,000 to 90,000 ounces at a cash cost of $500 to $560 per ounce and an AISC between $675 and $735 per ounce. The company previously released its gold production and revenue for the first quarter of 2018 (see news release dated April 13, 2018).

The company is also pleased to announce the appointment of Maryse Belanger as president of the company, in addition to her role as chief operating officer, with immediate effect.

Other milestones achieved during the quarter include:

• On Jan. 29, 2018, the company announced the results of the phase 2 life of mine expansion prefeasibility study (in accordance with National Instrument 43-101), which identified mineral reserves at the Fifteen Mile Stream and Cochrane Hill deposits.
• Completion of the phase 3 expansion drilling program at Fifteen Mile Stream and Cochrane Hill, which is designed to target extensions of mineralization, and define and upgrade inferred resources not included in the company's prefeasibility study (see news releases dated Jan. 29, 2018, and March 15, 2018).

Throughout 2018, the company will continue to focus on the following:

• Producing 82,000 to 90,000 ounces from Touquoy at a cash cost of $500 to $560 per ounce ($400 (U.S.) to $448 (U.S.)) and an AISC between $675 and $735 ($540 (U.S.) to $588 (U.S.)) per ounce;
• Progressing the company's phase 4 regional diamond drilling program, which commenced in April, 2018, designed to systematically explore the corridor of the prospective structure targeting the company's disseminated-style gold deposit model amenable to open-pit mining;
• Progressing and seeking approval of the environmental impact statement for Beaver Dam;
• Preparation of the Fifteen Mile Stream and Cochrane Hill environmental impact statements, with submissions expected in Q4 2018 and Q1 2019;
• Achieving the company's Q2 2018 production guidance for MRC (being between 21,000 and 22,000 ounces).

                                 Q1 2018 OPERATING RESULTS
  
                                            For the month ended     For the three months ended
                                                 March 31, 2018                 March 31, 2018

Operating data                                                                  
Ore mined (tonnes)                                      367,456                      1,094,487     
Strip ratio (waste to ore)                                 0.63                           0.47         
Mining rate (tonnes per day)                             19,339                         17,874       
Ore milled (tonnes)                                     188,221                        419,150
Head grade (g/t Au)                                        1.53                           1.44        
Recovery (per cent)                                          95                             94         
Mill throughput (tonnes per day)                          6,071                          4,657   
Gold ounces produced (oz)                                 8,810                         18,183     
Gold ounces sold (oz)                                     7,755                         17,187     

Gold production and sales

During the three months ended March 31, 2018, MRC produced 18,183 ounces of gold and sold 17,187 ounces. These amounts include 9,373 ounces of gold produced and 9,432 ounces of gold sold during operation ramp-up in January, 2018, and February, 2018, prior to commencement of commercial production.

Mining

During the three months ended March 31, 2018, 1,094,487 tonnes of ore were mined at a 0.47-to-one strip ratio, with a total of 1,608,669 tonnes of material moved.

Processing

During the three months ended March 31, 2018, 419,150 tonnes of ore were processed at an average grade of 1.44 g/t (grams per tonne) Au and average process recovery of 94 per cent.

MRC experienced extreme winter conditions in January, 2018, and February, 2018, with more than 100 year precipitation and several power outages (which caused several days of operating downtime). During the ramp-up months, the company took the opportunity to fine-tune the processing plant (particularly in terms of materials handling associated with the crushing circuit). Production in March, 2018, supports the company's full-year production guidance for 2018.

Sustaining capital

The company incurred a total of $2,028,796 in sustaining capital expenditures during the three months ended March 31, 2018. The vast majority of the expenditures relate to the development of the tailings management facility to the targeted elevation, which commenced ahead of schedule due to favourable weather conditions in March, 2018.

Growth capital

The company incurred a total of $2,762,442 in growth capital expenditures during the three months ended March 31, 2018, with $977,860 being incurred in March, 2018. The majority of the expenditures relate to commissioning activities, costs associated with initial fitout of site infrastructure, and costs incurred due to design and commissioning issues identified as part of the ramp-up process.

                                     Q1 2018 FINANCIAL RESULTS
   
                                                        For the month ended     For the three months ended
                                                             March 31, 2018                 March 31, 2018

IFRS measures                                                                                          
Revenue                                                                                       $ 12,881,462       
Mine operating earnings                                                                          5,889,743   
Net income and comprehensive income                                                              3,310,557    
Earnings per share -- basic                                                                           0.02 
Earnings per share -- diluted                                                                         0.01  
Total cash and cash equivalents                                                                 15,282,095    
Cash generated from (used by) operating activities                                               4,214,432 
Total assets                                                                                   255,204,721 
Long-term debt                                                                                 100,160,009  
Non-IFRS performance measures                                                                       
Total cash cost (per ounce)                                         $   552                            549     
AISC (per ounce)                                                        752                            751 
Average realized price (per ounce)                                    1,663                          1,619 
Average realized cash margin (per ounce)                              1,111                          1,070
Average realize AISC margin (per ounce)                                 911                            868   

In the three months ended March 31, 2018, the company had earnings of $3,310,557, an increase of $4,772,960, compared with the $1,462,403 loss in the same period for 2017, as the company commenced commercial production on March 1, 2018.

Mine operating earnings

Since commercial production started on March 1, 2018, the company sold 7,755 ounces of gold at a weighted average price of $1,663 per ounce, resulting in revenue of $12,881,462. The company delivered 2,217 ounces into fixed price contracts and the remaining 5,538 ounces were sold at spot. Revenue is net of treatment and refining costs, which were $15,910 for the month ended March 31, 2018.

The costs of sales of $4,357,163 comprise production costs, royalties and selling costs. Cash costs per ounce sold were $552.

Depreciation and depletion totalled $2,634,556 since the start of commercial production. Most assets are depreciated or depleted on a units-of-production basis over the reserves to which they relate.

AISC

AISC per ounce sold for March, 2018, was $752. This is slightly higher than average guidance as it was the first month of commercial production, but consistent with guidance for the full year of 2018. AISC also includes approximately $1-million in costs related to the raising of the tailings management facility (as a sustaining capital expenditure). This amount was incurred ahead of plan due to favourable weather in March, 2018.

Working capital and liquidity

The company has a working capital deficit position as at March 31, 2018, of $23,216,469. Included in this deficit position is $32.15-million related to principal payments under the company's senior project loan facility (PLF). These amounts will be repaid from operating cash flow generated from MRC and therefore do not represent a liquidity risk for the company.

The company believes that it has sufficient financing to meet its obligations and to maintain administrative and operational expenditures for the next 12 months from existing treasury, as well as estimated future operating cash flows. MRC is expected to produce 82,000 to 90,000 ounces of gold in 2018 at a cash cost of between $500 and $560 per ounce. In order to mitigate gold price risk, the company was required to enter into margin-free gold forward sales contracts for 215,000 ounces, which is at a flat forward price of $1,550 per ounce, and scheduled out its hedged contracts over the life of the PLF to be delivered during production in 2018 and beyond. As of March 31, 2018, there were 206,456 ounces committed to the gold forward contracts for delivery between April, 2018, and February, 2021.

Exploration update

The company completed its phase 3 expansion drilling program at Fifteen Mile Stream and Cochrane Hill in the first quarter of 2018. The objectives of the phase 3 expansion drilling program were to:

• Identify additional gold resources immediately peripheral to those resources previously defined at Fifteen Mile Stream and Cochrane Hill;
• To upgrade previously defined inferred mineral resources to measured and indicated categories at Cochrane Hill and at Fifteen Mile Stream (particularly at the Hudson and Plenty zones);
• Seek additional new resources within the 350-metre gap between the Plenty and Egerton MacLean zones at Fifteen Mile Stream.

The phase 3 resource expansion diamond drilling program at Fifteen Mile Stream comprised 185 holes to Dec. 31, 2017, and was completed at the end of January, 2018, with a total of 24,325 metres drilled in 221 holes. Holes were generally drilled on 25-metre-by-20-metre centres, except for the first-pass drilling along the 350-metre gap between Plenty and Egerton MacLean (where holes were drilled on 50-metre-spaced sections).

The phase 3 resource expansion diamond drilling program at Cochrane Hill was completed at the end of December, 2017, with a total of 6,900 metres in 44 holes. Results from the phase 3 resource expansion diamond drilling program were announced in news releases dated Dec. 20, 2017, Jan. 17, 2018, Jan. 24, 2018, Feb. 22, 2018, March 15, 2018, and April 4, 2018.

It is expected that further drilling will be required in 2018 to define the new mineralization identified in the programs recently completed at Cochrane Hill and Fifteen Mile Stream. The company currently plans to update the mineral resource and mineral reserves estimates late in the second half of 2018 (when all the results have been received and compiled).

Phase 4 program

The phase 4 corridor regional program is designed to systematically explore along the 45-kilometre-plus (untested) structure hosting all existing deposits. This underexplored and geologically prospective 45-kilometre trend extends northeast from the central processing facility at Touquoy to the Beaver Dam gold deposit and through to the Fifteen Mile Stream gold deposit in the east. Two drill rigs have been mobilized and have commenced drilling. The objective of the program is to explore the gaps between the three known deposits along this trend. The program comprises up to a total of 100,000 metres of diamond drilling distributed throughout the corridor connecting Touquoy, Beaver Dam and Fifteen Mile Stream.

Qualified persons

Kodjo Afewu, PhD, SME, plant manager for the company and a qualified person as defined by National Instrument 43-101, has approved the scientific and technical information related to operations matters contained in this news release.

Doug Currie, PGeo, MAusIMM, general manager of exploration for the company and a qualified person as defined by NI 43-101, has approved the scientific and technical information related to exploration matters contained in this news release.

Conference call details

The company is hosting a live question-and-answer conference call to discuss the results on May 23, 2018, at 2 p.m. ET. Participants may join the call by dialling the following numbers.

Participant dial-in numbers

Toronto:  1-416-764-8688

Vancouver:  1-778-383-7413

North America (toll-free):  1-888-390-0546

Please provide the company name (Atlantic Gold) to the operator. A recorded playback of the call will be available one hour after the call's completion until June 23, 2018, by dialling the following number.

North America (toll-free):  1-888-390-0541

Please enter the playback passcode 179232. A recording will also be available on the company's website.

About Atlantic Gold Corp.

Atlantic Gold is a well-financed, growth-oriented gold development group with a long-term strategy to build a mid-tier gold production company focused on manageable, executable projects in mining-friendly jurisdictions.

Atlantic Gold is focused on growing gold production in Nova Scotia, beginning with its MRC phase 1 open-pit gold mine, which declared commercial production in March, 2018, and its phase 2 life-of-mine expansion, which will ramp up gold production to over 200,000 ounces per year at industry lowest-quartile cash and all-in sustaining costs (as stated in the company's news releases dated Jan. 19, 2018, and Jan. 29, 2018).

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