An anonymous director reports

GOLDGROUP ANNOUNCES PRIVATE PLACEMENT AND PROVIDES CORPORATE UPDATE

Goldgroup Mining Inc. has arranged a non-brokered private placement financing and has provided a corporate update with regard to the assets of the company.

Financing

Goldgroup intends to complete a non-brokered private placement financing to raise at least $1-million at a price of 20 cents per unit. Each unit will consist of one common share and one-half of one non-transferable share purchase warrant. Each full warrant will entitle the holder to purchase one additional common share of the company at a price of 25 cents for a period of 24 months. The private placement is expected to close on or before Aug. 1, 2014, and the company expects that up to 25 per cent of the units will be purchased by company insiders. The proceeds from the private placement will be used for working capital. The common shares from this private placement will be subject to a four-month hold period. The private placement is subject to Toronto Stock Exchange and other required regulatory approval.

San Jose de Gracia

The government of the State of Sinaloa has recently taken steps to attempt to bring a resolution to the dispute over the high-grade San Jose de Gracia gold project. Recently, the Sinaloa government has requested that Goldgroup and its earn-in partner on San Jose de Gracia, DynaResource Inc., resolve their differences through mediation with the Sinaloa government acting as facilitator to that mediation. This process has commenced with meetings between Goldgroup, DynaUSA and the Sinaloa government having taken place. Goldgroup hopes to find a resolution to this issue in the near term.

Caballo Blanco

Goldgroup's 100-per-cent-owned Caballo Blanco gold project hosts indicated mineral resources of 28.9 million tonnes grading 0.62 gram per tonne gold containing approximately 575,000 ounces of gold and inferred mineral resources of 24 million tonnes grading 0.54 gram per tonne gold containing approximately 419,000 ounces of gold (based on a 0.2-gram-per-tonne-cut-off grade; see the company's technical report entitled, "Preliminary economic assessment, Caballo Blanco heap leach, Veracruz, Mexico," dated May 7, 2012). Caballo Blanco remains a flagship asset of the company and remains a priority of Goldgroup. The company maintains communication with all stakeholders of Caballo Blanco inside and outside of Veracruz state and remains committed to advancing the project for the benefit of the Veracruz state, Mexico, and Goldgroup shareholders.

Cerro Prieto

For the three months ended June 30, 2014, the company mined a total of 510,199 tonnes of material, including 140,463 tonnes, which were placed on the leach pads at Cerro Prieto. Of the 140,463 tonnes of ore mined and placed on the pads, the majority of them have been taken from outside the mine plan, which resulted in a lower average grade. This was done to allow for the necessary time to strip overburden to expose ore within the mine plan. Gold produced over the three- and six-month period ended June 30, 2014, was 1,244 ounces and 3,098 ounces of gold, respectively.

The company continues to define the optimal crushing standards, which the company believes should help improve recovery rates of gold. Metallurgical testwork on the tertiary crusher (high-pressure grinding-roll) product has helped define the optimal standards, and finer crushing and screening should be possible with the revised circuit, which is expected to be operational within six to eight weeks. The company experienced a lack of water availability, which has been resolved with the addition of two new water wells being drilled and the commencement of the wet season. The addition of the new wells is expected to provide sufficient water for mining operations.

The company wishes to clarify that it has not based its production decision or its internal mine plan at Cerro Prieto on a preliminary economic assessment demonstrating the potential viability of mineral resources or a feasibility study of mineral reserves demonstrating economic and technical viability, and as a result, there is increased uncertainty and multiple technical and economic risks of failure, which are associated with this production decision and internal mine plan. These risks, among others, include areas that are analyzed in more detail in a PEA or feasibility study, such as applying economic analysis to resources, more detailed metallurgy and a number of various specialized studies.

Cerro Colorado

The company ceased adding reagents in July, 2014, to the leaching process at the company's 100-per-cent-owned Cerro Colorado mine, which began a wind-down phase in the fourth quarter of 2013 and will continue to see declining amounts of gold ounces being produced. The company also continues to actively pursue opportunities to better match its assets to its long-term goal of increasing shareholder value.

Marc Simpson, PGeo, acts as Goldgroup's in-house qualified person for exploration results for the purposes of NI 43-101, and has reviewed and verified the technical information.

The scientific and technical information contained in this document relating to mining operations at Cerro Prieto and Cerro Colorado was under the supervision of Robert Friesen, PGeo, who is a qualified persons under National Instrument 43-101 (standards of disclosure for mineral projects). Mr. Friesen has reviewed and verified the technical information.

We seek Safe Harbor.