Mr. Stabro Kasaneva reports

AUSTRAL GOLD PROVIDES NON-BROKERED PRIVATE PLACEMENT UPDATE

Austral Gold Ltd. has completed the first tranche of the previously announced non-brokered private placement financing of up to $1-million (U.S.), or approximately $1.6-million (Australian). The company has issued 919,158 non-transferable unsecured convertible notes for gross proceeds of $590,503 (U.S.) (approximately $919,158 (Australian)), immediately following execution by the parties of an amendment agreement to allow for closing the private placement in two tranches, with the second tranche due within 30 days of this announcement.

The convertible notes were purchased by one arm's-length accredited and sophisticated investor, and the gross proceeds raised are expected to be used for working capital.

The notes, nominated in Australian dollars, bear a 9-per-cent-per-annum interest rate and mature on the second anniversary of the date they are issued. Each note entitles the holder to convert the notes into ordinary shares of the company at the holder's option at a conversion price of 5.9 Australian cents (approximately 5.1 cents) per share during the first year and 11.8 Australian cents (approximately 10.3 cents) during the second year.

The notes and the underlying conversion shares will be subject to a four-month hold period as required by applicable Canadian law. The notes will not be listed on any public market. The convertible notes may not be converted until after four months and one day from the date they are issued.

About Austral Gold Ltd.

Austral Gold is a growing gold and silver mining producer building a portfolio of quality assets in the Americas. Austral continues to lay the foundation for its growth strategy by advancing its attractive portfolio of producing and exploration assets.

We seek Safe Harbor.