Mr. Douglas Meirelles reports

SOUTH ATLANTIC PROVIDES UPDATE ON CURRENT STAGE OF THE TUCANO PROCESS IN BRAZIL

South Atlantic Gold Inc. is continuing to work to add to the number of creditors of Mina Tucano Ltda., Beadell (Brazil) Pty. Ltd. and Beadell (Brazil 2) Pty. Ltd. that support or give priority to South Atlantic's indicative proposal to acquire entities of the Tucano Group under judicial reorganization proceedings, pursuant to a plan of reorganization to be approved by creditors and confirmed by the relevant court in a manner favourable to all stakeholders involved.

Highlights

The Company would like to encourage all officially listed creditors of the Tucano Group to contact South Atlantic's subsidiary in Brazil through the contact information made available in the Judicial Process, as the Company would like to engage with all creditors regarding their potential interests and potential terms of negotiation.

The Judicial Process has many stages. At the current stage, the process requires a decision to be made by a majority of the creditors 1 of Tucano Group in each of several different classes of creditors by mid-September.

Throughout the next few weeks, South Atlantic anticipates that it will continue to grow its base of supportive creditors, which could culminate in a plan reflecting South Atlantic's indicative proposal being presented by the supporting parties and approved by the required majorities.

As previously disclosed, certain creditors of Tucano Group have already expressed that they have given priority to the proposal made by South Atlantic to acquire Tucano Group. South Atlantic has also received letters of priority and other similar support from creditors that are strong influencers and leaders in the mining space in Brazil.

The Judicial Process may have several different outcomes and many additional phases as it is ultimately dependent on the decision(s) of the creditors and the relevant court 1 .

In the event that no restructuring plan is accepted by the creditors (including the plan reflecting South Atlantic's proposal or the plan from the debtor or any future variations), the complete bankruptcy of Tucano Group is a potential outcome, which, in our view, would not be advantageous for any stakeholder, including the creditors themselves.

South Atlantic has the right to terminate negotiations at any time should negotiations with the creditors of the Tucano Group fail to advance or if the Company is not satisfied, in its sole discretion, with the results of its negotiations or its due diligence review of the Tucano Mine or other assets. There can be no assurance that the creditors of the Tucano Group will favour the plan reflecting South Atlantic proposal.

About South Atlantic Gold Inc.

South Atlantic is an exploration company engaged in acquiring and advancing mineral properties located in the Americas. Our flagship asset is the 100%-owned Pedra Branca project, located 280 km southwest of Fortaleza, Ceara State, Brazil. South Atlantic is focused on creating value for its shareholders by engaging in the development and acquisition of high-quality mineral assets located in stable and mining-friendly jurisdictions. South Atlantic is based in Kelowna, British Columbia, and is listed on the TSX-V under the symbol "SAO".

We seek Safe Harbor.