Mr. Scott Caldwell reports

GUYANA GOLDFIELDS INC. REPORTS SECOND QUARTER 2017 RESULTS AND MAINTAINS PRODUCTION GUIDANCE

Guyana Goldfields Inc. has released its second quarter 2017 operational and financial results. All amounts are expressed in U.S. dollars unless otherwise stated. A conference call will be held tomorrow at 10 a.m. ET to discuss the results, and details of the call can be found at the end of the release.

Second quarter 2017 operational results:

• Gold production of 29,700 ounces based on mill throughput of 515,600 tonnes at an average head grade of 2.06 grams per tonne gold and average recoveries of 86.5 per cent;
• Operating cash costs (1) for the quarter of $757 per ounce and all-in sustaining costs (AISC) (1) of $1,144 per ounce;
• The company maintains its 2017 production guidance and expects to come in at the lower end of the guidance range of 160,000 to 180,000 ounces of gold;
• The company's balance sheet remains strong with its cash balance of $65.4-million versus a debt balance of $68.8-million. The fair market value of the company's investment in SolGold PLC at quarter-end was $52.2-million;
• The company continues to have an excellent health, safety and environmental record with over 3.5 million employee hours worked without a lost-time incident.

Scott Caldwell, president and chief executive officer, stated: "The company experienced a weaker quarter with respect to both production and cost performance. This was primarily attributable to lower-than-expected grades from stockpiled ore being fed to the mill and a higher strip ratio in the quarter. The company does not expect these issues to recur in the second half of the year with mill feed ore being sourced predominantly from the higher-grade tonalite at Rory's Knoll while the strip ratio is expected to decline significantly in both the third and fourth quarters based on mine sequencing. Looking forward, the company's 2017 production guidance remains unchanged, July's preliminary cost and operating performance is trending favourably on all metrics, and we anticipate a strong third quarter and finish to the year."

Preliminary third quarter results:

• For the month of July, 2017, operational and cost performance trended favourably, as expected.
• Gold production from July mining operations totalled approximately 12,100 ounces. Mine and mill performance was above budgeted levels with the mill having processed an average of 6,032 tonnes per day of ore at an average head grade of 2.21 grams per tonne gold with gold recoveries averaging 89.5 per cent.
• Cost-efficiency was further achieved at the beginning of the third quarter as the company commissioned two new drill rigs resulting in only minor reliance on the use of more expensive rental drills. In addition, bulk emulsion explosives were being used for all blasting activities postquarter-end after a delay in the delivery of the explosives from the manufacturer resulted in a shift back to more expensive packaged explosives in the second quarter.

                               AURORA GOLD MINE OPERATIONAL STATISTICS 

                                                     Q2 2017        Q1 2017        Q4 2016        Q3 2016        Q2 2016

Ore mined (tonnes)                                   511,600        498,800        688,000        642,200        623,400
Waste mined (tonnes)                               3,097,200      2,389,700      1,899,800      1,315,100      1,076,700
Total mined (tonnes)                               3,608,800      2,888,400      2,587,800      1,957,300      1,700,100
Strip ratio (waste to ore)                               6.1            4.8            2.8            2.0            1.7
Tonnes mined per day                                  39,700         32,100         28,100         21,300         18,700
Ore processed (tonnes)                               515,600        602,800        507,500        491,200        427,700
Tonnes processed per day                               5,700          6,700          5,500          5,300          4,700
Head grade (g/t Au)                                     2.06           2.44           2.94           2.42           2.61
Recovery (%)                                            86.5           89.7           90.6           88.7           91.1
Mill utilization (%)                                    89.3           92.4           87.3           89.9           90.2
Gold produced (ounces)                                29,700         40,900         43,800         34,400         32,000
Gold sold (ounces)                                    30,000         40,700         45,500         33,300         36,600
Average realized gold price ($/ounce)                 $1,263         $1,227         $1,204         $1,334         $1,269
Cash costs per ounce before royalty (1) ($/ounce)        757            516            446            499            524
All-in sustaining costs (1) ($/ounce)                  1,144            861            678            796            729
Cost of sales (includes production, royalty and
depreciation) ($/ounce)                                1,164            827            750            811            842

Second quarter 2017 operational results summary:

• Mill head grade for the quarter of 2.06 grams per tonne gold was lower than budgeted primarily due to lower-than-expected grades from stockpiled ore being fed to the mill during the quarter. The lower-than-expected grades of the stockpiled can be attributed to the processing of the stockpile accumulated early on in the mine life when ore control measures were still being fine-tuned. The company expects a significant increase in mill feed grade in the second half of the year as mining activity shifts to higher-grade ore from the tonalite at Rory's Knoll while the strip ratio is expected to decline significantly in both the third and fourth quarters based on mine sequencing.
• Recoveries were lower in the quarter partly due to the lower grades being fed to the mill but also due to the presence of organic material (timber shafts and support beams) associated with the historical underground workings at Aleck Hill resulting in the preg robbing of gold ore in the processing circuit. The company is now close to mining below the level of the historical underground workings and hence does not expect to encounter further organic material.
• The mill processed 515,600 tonnes or 5,700 tpd in the quarter, in line with budgeted levels, however, lower than the previous quarter due to scheduled SAG mill downtime for necessary repairs to the cyclone feed line, mill chute plug and the installation of slurry grates. In addition, lower levels of saprolite ore were fed to the mill due to a temporary slowdown in mining rates in the saprolite at Aleck Hill as mining activity worked through zones containing historical underground workings.
• Costs on a per-ounce basis were higher for the quarter due to the lower grades, lower recoveries and a higher strip ratio. In addition, mining costs were above budgeted levels due to the continued use of rental drills due to a delivery delay on two new production drills, which were anticipated to be in operation during the quarter. Blasting costs were also higher as manufacturer delays in the delivery of bulk emulsion explosives to site resulted in the company reverting to the use of more expensive packaged explosives for most of the quarter. Both these issues have been addressed with the two new drill rigs being fully operational and bulk emulsion explosives being used for all blasting activities at the beginning of the third quarter.

                                    SELECTED FINANCIAL INFORMATION
                  (in thousands of dollars, except ounces, per-ounce and per-share figures) 

                                                        Q2 2017      Q1 2017      Q4 2016      Q3 2016      Q2 2016

Revenues                                               $ 37,899      $49,957      $54,809     $ 44,403     $ 46,411
Earnings from mine operations                          $  2,966      $16,317      $20,673     $ 14,777     $ 15,619
Earnings (loss) before tax                             $ (3,023)     $10,391      $ 9,379     $ 11,942     $ 11,647
Net earnings (loss)                                    $ (3,129)     $ 9,938      $ 3,405     $  8,921     $  7,642
Net earnings (loss) per diluted share                  $  (0.02)     $  0.06      $  0.02     $   0.05     $   0.05
Cash flow from operations                              $  7,155      $16,918      $23,267     $ 13,802     $ 15,565
Cash and cash equivalents                              $ 65,355      $75,431      $73,151     $105,190     $ 16,612
Restricted cash balances                               $  1,132      $ 1,197      $ 1,184     $ 23,317     $ 23,281
Total debt (excluding deferred financing charges)      $ 68,762      $73,617      $78,413     $135,650     $143,370

Second quarter 2017 financial performance summary:

• The company sold 30,009 ounces of gold in the second quarter generating $37.9-million in revenues at an average realized price of $1,263 per ounce.
• On a year-to-date basis, the company sold 70,709 ounces of gold and generated $87.9-million at an average realized price of $1,244 per ounce.

2017 outlook and opportunites:

• Despite the higher costs in the second quarter, the company is maintaining its production and cost guidance for 2017 and believes the lower range of production guidance will be achieved. As discussed previously, the grade profile based on mine sequencing is expected to be significantly higher in the second half of the year while the strip ratio is expected to be materially lower, both of which will translate to lower costs on a per-ounce basis. A revised mine plan reflecting improvements in pit slope limits allows for a reduction in the mining of waste for the second half of 2017. In addition, mining costs on a unitary basis should also move materially lower for the rest of the year as cost-efficiencies are achieved with the decommissioning of rental equipment and the use of bulk emulsion explosives at the start of the third quarter after delivery delays experienced in the prior quarter.
• Due to the timing of sustaining capital expenditures, all-in sustaining costs are also expected to be significantly lower in the second half of the year relative to the first half. This primarily relates to $3.4-million or $49 per ounce spent in the first half of the year on an additional pumping station, expanding the truck fleet, as well as the purchase of two new excavators. Capital spent on the expansion of the mining fleet in 2017 is now largely complete. Expenditures on deferred stripping are also expected to be significantly lower in the second half of the year.

2017 guidance:

Gold production:  160,000 ounces to 180,000 ounces

Cost of sales (production costs, royalty and depreciation):  $800 per ounce to $850 per ounce

Cash cost (1), excluding royalty:  $500 per ounce to $550 per ounce

All-in sustaining costs (1):  $775 per ounce to $825 per ounce

Exploration activities:

• Exploration efforts in the quarter were focused on trenching and drilling the northwest extension of Aleck Hill, as well as advancing multiple greenfield targets through soil sampling and trenching. Assay results received thus far at northwest Aleck Hill only returned anomalous levels of gold mineralization. Further mapping work of other brownfield targets within close proximity to the Aurora mill to define drill targets is currently in progress.
• Exploration work at greenfield targets included trenching and soil sampling at the Greater Sulphur Rose area and Wynamu-Kalaloo. Nine trenches were excavated to test a ground IP (induced polarization) chargeability anomaly and airborne radiometric anomalies northwest of the Sulphur Rose deposit. Two diamond drill holes were drilled to test these anomalies. Results are still pending. A regional soil sampling program along the Sulphur Rose-Arangoy corridor is in progress, which is an area that spans northeast and extends farther north of the Sulphur Rose deposit. The program covers an area of 36 square kilometres with 3,600 projected samples to be collected. The soil program is currently 80 per cent complete.
• A regional soil sampling program is continuing and nearly complete covering a northeast-trending corridor from Kalaloo to Wynamu. Ten trenches with a total length of 1,500 metres are proposed for later this month to test a series of gold anomalies identified by deep auger sampling. A 10-hole drill program is proposed to test a significant gold anomaly and trench sampling with best results of 58 metres of 1.21 grams per tonne gold. This work is expected to be commenced in the third quarter after access is prepared.
• Exploration through the rest of the year will consist of mapping and relogging of core on the company's brownfield targets and trenching and drilling at the company's greenfield targets, namely Sulphur Rose and Wynamu.

Mill expansion progress

The first phase of the mill expansion is expected to be completed by the end of the first quarter of 2018 at a capital cost of approximately $21.4-million. Progress in the second quarter was focused mainly on concrete and earthworks. Slab and containment walls for the three new leach tanks neared completion during the quarter, and solid progress was made on the installation of the thickener footings. Engineering also progressed well and, as at the quarter-end, was approximately 70 per cent complete. The procurement of all mechanical packages was largely complete by quarter-end with the focus now shifting to the procurement of the remaining electrical and structural packages. Over all, the first phase of the expansion is tracking in-line with the original budget and schedule.

Conference call

A conference call will be held Aug. 1 at 10 a.m. ET. Participants may join the call by dialling North America toll-free 1-888-231-8191 or 647-427-7450 for calls outside Canada and the United States, and entering the participant passcode 47293228.

A live and archived webcast of the conference call will also be available at the company's website for 90 days under the investors and events and presentations section.

A recorded playback of the second quarter 2017 operational and financial results call will be available until Aug. 8, 2017, by dialling: 1-855-859-2056 or 416-849-0833 and entering the call back passcode 47293228.

About Guyana Goldfields Inc.

Guyana Goldfields is a Canadian based mid-tier gold producer primarily focused on the exploration, development and operation of gold deposits in Guyana, South America. The 100-per-cent-owned Aurora gold mine achieved commercial production Jan. 1, 2016, and has a total gold resource of 6.25 million ounces in the measured and indicated categories (59.73 million tonnes at 3.25 g/t Au), as well as an additional 1.79 million ounces in the inferred category (16.58 million tonnes at 3.79 g/t Au). For further details, please refer to the report entitled "Independent technical report updated feasibility study, Aurora gold mine project, Republic of Guyana," dated Feb. 2, 2017, available on SEDAR.

(1) This is a non-international financial reporting standard measure. Refer to the non-IFRS performance measures section in the June 30, 2017, management's discussion and analysis.

We seek Safe Harbor.