GREAT BASIN GOLD REPORTS QUARTERLY RESULTS

VANCOUVER, May 17 /CNW/ --
Including initial Production and Revenue from the Burnstone Mine

VANCOUVER, May 17 /CNW/ - Great Basin Gold Ltd. ('Great Basin Gold' or
the 'Company'), (TSX: GBG; NYSE Amex: GBG; JSE: GBG) reports results
for the quarter ending March 31, 2011.

Highlights for the quarter include:

    --  Completion of all the main capital projects at Burnstone with
        maiden revenue recognized.
    --  Improvement of recoveries at Esmeralda plant.
    --  Continued decrease in loss from operating activities as
        revenues from both projects increase.
    --  Hollister operation removed from MSHA's(1) potential pattern of
        violation watch list (see release March 23, 2011).
    --  Successful completion of a $86 million bought deal public
        offering (which included exercise of the underwriters' 15
        percent over-allotment right) at a record high price for a
        Great Basin offering of common equity.
    --  Completed Credit Agreement with a major international bank for
        a US$70 million term loan financing to allow repayment of the
        high cost 2008 Senior Secured Notes.

Revenue of $26.4 million from the sale of 17,324 Au eqv oz from our
Nevada operations as well as 2,794 Au oz from our South African
operations was recorded for the quarter. Approximately 11,000 Au eqv oz
delivered to refiners were not included in sales (approximately $15
million in revenue) for the quarter due to the transfer of ownership to
the buyer only taking place in April. The delay in recognizing revenue
from the Nevada operations had a negative impact on the earnings for
the quarter. Loss from operating activities significantly improved from
the $6.6 million loss recorded in the comparable quarter in 2010 to a
loss of $827 thousand recorded in Q1 2011. The net loss for the quarter
of $20.3 million was impacted by the fair value charges attributable to
the initial recognition and mark-to-market adjustment of the zero cost
collar hedge programs ($6.0 million) as well as the settlement loss
recognized on repayment of the Senior Secured Notes ($8.8 million). The
loss for the quarter was $0.05 per share.

The Company closed an $86 million bought deal public offering on
February 23, 2011 with the proceeds from this transaction mainly being
utilized for working capital requirements during the production
build-up at the Burnstone Mine. A US$70 million Term Loan facility was
also closed on March 16, 2011 with the proceeds being utilized to
settle the Senior Secured Notes. The Company had $68 million in cash
reserves on March 31, 2011.

Burnstone

At Burnstone, the Metallurgical Plant as well as all other major capital
projects were commissioned during January 2011. 5,511 gold ounces (Au
oz) were recovered during the quarter with 2,794 oz sold to record
maiden revenue of $3.8 million. Cash production cost(2) per tonne was $68 (ZAR490) for the quarter, which is in-line with the
planned cost during production build-up. Ounces recovered were
predominantly from development ore processed, which includes more
dilution than stoped material and negatively impacts on the mill head
grade. This lower head grade also impacts on recoveries, with 83%
recovery achieved for the quarter on the 0.03 Au oz/t (1.03 g/t) head
grade. Recoveries are expected to improve to the planned 95% as the
head grade increases. The impact of the lower head grade is reflected
in the cash production cost per ounce of $1,344 (ZAR 9,555) recorded
for the quarter. The Metallurgical Plant is performing in line with the
production build-up plan with 199,878 tonnes processed during the
quarter.

Ore tonnes to surface increased steadily throughout the quarter in line
with the increase in development meters. Development rates are planned
to increase from a monthly average of 3,300 ft (1,000 meters) in Q1
2011 to 10,000 ft (3,000 meters) by the end of Q4 2011. The majority of
ore tonnes for the quarter came from on-reef development, with only 26%
of contained ounces extracted from stoping. Congestion underground and
the ability to clean the material from stopes and development ends
still remain a challenge while infrastructure development work is
continuing around the vertical shaft on 40 and 41 levels. Additional
travel ways and material handling systems around the shaft bottom are
being developed to enable maximum hoisting through the vertical shaft
which will alleviate the congestion and improve cleaning time.

Mechanized development continued with 3,288 meters being developed
during the quarter against a plan of 3,600 meters, bringing the total
development for the project to date to 12,402 meters, of which 6,855
meters are on-reef.  Progress with long hole stoping remains
encouraging: efficiencies of the teams are improving on a monthly
basis. Dilution is well managed and the teams have shown that they can
stope at the required rate given the availability of stopes and the
ability to clean the material. Long hole stoping commenced in the C
Middle block in early May 2011; a more competent footwall in this area
resulted in further improvements in dilution and grade control.

Hollister

Hollister maintained the momentum from Q4 2010 by recording 17,324 gold
equivalent(3) ounces (Au eqv oz) in sales during the quarter, with an additional
11,000 Au eqv oz delivered to the refiner by quarter end that has not
been included in sales. During the continuing installation of the acid
regeneration system at the Esmeralda Mill, loaded carbon is being sent
to the refiner instead of doré, resulting in a timing delay of when the
revenue on these ounces can be recognized. In total, approximately
28,500 Au eqv oz were delivered to the refiner during the quarter.
Notwithstanding the delay caused in recognizing the revenue on carbon
sent to the refiner, the strategy of introducing new carbon delivered
the planned results, with Au recoveries increasing to an average of 88%
during the quarter. The program to continuously replace carbon
commenced in February 2011 and since then, Au recoveries have exceeded
90%, with Ag recoveries exceeding 70%. The Esmeralda Mill treated
21,634 tonnes during the quarter with an average head grade of
approximately 1 Au eqv oz/t (32.15 Au eqv g/t). Cash production costs
for the quarter were 3% lower quarter on quarter at $670 per Au eqv oz
and are still impacted by the lower recoveries and the additional costs
incurred in replacing  carbon. The installation of the acid
regeneration system is planned for completion in Q3 2011.

During the quarter fifteen boreholes were completed to test the
extensions of Blanket zone mineralization exposed by trial mining at
3000N 1E; assays from nine boreholes are still awaited. The drilling is
indicating structural cutoffs of this mineralization in-line with the
structures controlling the Clementine #18 vein pay shoot below. The
evaluation strategy for the Blanket zone mineralization is being
modified as mining and drilling advance. It is clear that the bulk
sampling of exposures is proving to be more accurate in evaluating the
variable extent of the bonanza grade mineralization. The close
relationship of the development of bonanza grades with underlying high
grade 'pay-shoot' epithermal veins is becoming evident.  As a
consequence, the Blanket drilling program is being modified and
extended to test other targets within the mine development.

Ferdi Dippenaar, Great Basin Gold President and CEO, commented:

'With the successful completion of the Burnstone Mine commissioning, our
focus in 2011 has changed from construction to production. Despite
experiencing the usual challenges with bringing a new mine into
production, good overall progress is being made with increasing rates
of development and production.

The Nevada operations continued to show improvements in a number of
areas during the quarter, notably on ounces recovered through trial
mining as well as the improved recoveries at our Esmeralda Mill. Mining
of the Blanket Zone continued with a total of 2,961 tons mined to date
which, at grades of 3.75 Au oz/t and 6.55 Ag oz/t, resulted in 11,382
Au eqv ounces being extracted. Indications are that a number of these
lenses of mineralization will be encountered above the high grade zones
of the underlying veins. Following the receipt of the necessary
approvals, surface exploration to possibly extend the current Hollister
vein system to the Hatter Graben area is planned to recommence in Q3
2011.'

Johan Oelofse, Pr.Eng., FSAIMM, Chief Operating Officer  of Great Basin
Gold, and Phil Bentley, PrSciNat, Vice President: Geology &
Exploration, Qualified Persons as defined by regulatory policy, have
reviewed and assumed responsibility for the technical information
contained in this release.

No regulatory authority has approved or disapproved the information
contained in this news release.

Cautionary and Forward Looking Statement Information

This document contains 'forward-looking statements' that were based on
Great Basin's expectations, estimates and projections as of the dates
as of which those statements were made. Generally, these
forward-looking statements can be identified by the use of
forward-looking terminology such as 'outlook', 'anticipate', 'project',
'target', 'believe', 'estimate', 'expect', 'intend', 'should' and
similar expressions.

Forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that may cause the Company's actual
results, level of activity, performance or achievements to be
materially different from those expressed or implied by such
forward-looking statements. These include but are not limited to:

    --  uncertainties and costs related to the Company's exploration
        and development activities, such as those associated with
        determining whether mineral resources or reserves exist on a
        property;
    --  uncertainties related to Technical Reports that provide
        estimates of expected or anticipated costs, expenditures and
        economic returns from a mining project; uncertainties related
        to expected production rates, timing of production and the cash
        and total costs of production and milling;
    --  uncertainties related to the ability to obtain necessary
        licenses, permits, electricity, surface rights and title for
        development projects;
    --  operating and technical difficulties in connection with mining
        development activities;
    --  uncertainties related to the accuracy of our mineral reserve
        and mineral resource estimates and our estimates of future
        production and future cash and total costs of production, and
        the geotechnical or hydrogeological nature of ore deposits, and
        diminishing quantities or grades of mineral reserves;
    --  uncertainties related to unexpected judicial or regulatory
        proceedings;
    --  changes in, and the effects of, the laws, regulations and
        government policies affecting our mining operations,
        particularly laws, regulations and policies relating to
  o mine expansions, environmental protection and associated compliance
    costs arising from exploration, mine development, mine operations
    and mine closures;
  o expected effective future tax rates in jurisdictions in which our
    operations are located;
  o the protection of the health and safety of mine workers; and
  o mineral rights ownership in countries where our mineral deposits
    are located, including the effect of the Mineral and Petroleum
    Resources Development Act (South Africa);
    --  changes in general economic conditions, the financial markets
        and in the demand and market price for gold, silver and other
        minerals and commodities, such as diesel fuel, coal, petroleum
        coke, steel, concrete, electricity and other forms of energy,
        mining equipment, and fluctuations in exchange rates,
        particularly with respect to the value of the U.S. dollar,
        Canadian dollar and South African rand;
    --  unusual or unexpected formation, cave-ins, flooding, pressures,
        and precious metals losses (and the risk of inadequate
        insurance or inability to obtain insurance to cover these
        risks);
    --  changes in accounting policies and methods we use to report our
        financial condition, including uncertainties associated with
        critical accounting assumptions and estimates; environmental
        issues and liabilities associated with mining including
        processing and stock piling ore;
    --  geopolitical uncertainty and political and economic instability
        in countries which we operate;  and
    --  labour strikes, work stoppages, or other interruptions to, or
        difficulties in, the employment of labour in markets in which
        we operate mines, or environmental hazards, industrial
        accidents or other events or occurrences, including third party
        interference that interrupt the production of minerals in our
        mines.

For further information on Great Basin Gold, investors should review the
Company's annual Form 40-F filing with the United States Securities and
Exchange Commission www.sec.com and home jurisdiction filings that are available at www.sedar.com.  The Company undertakes no obligation to update forward-looking
information if circumstances or management's estimates or opinions
should change except as required by law.

Cautionary Note regarding Non-GAAP Measurements

Cash production cost per ounce/tonne is a not a generally accepted
accounting principles ('GAAP') based figure but rather is intended to
serve as a performance measure providing some indication of the mining
and processing efficiency and effectiveness. It is determined by
dividing the relevant mining and processing costs including royalties
by the ounces produced/tonnes milled in the period. There may be some
variation in the method of computation of 'cash production cost per
ounce/tonne' as determined by the Company compared with other mining
companies. Cash production costs per ounce/tonne may vary from one
period to another due to operating efficiencies, waste to ore ratios,
grade of ore processed and gold recovery rates in the period. We
provide this measure to our investors to allow them to also monitor
operational efficiencies. As a Non-GAAP Financial Measure cash
production costs should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP. There is material limitations associated with the use of such
Non-GAAP measures.

(1) Mine Safety and Health Administration


(2) Cash production cost is a non-GAAP measure and is calculated by
deducting non-cash charges from production costs (refer to section 12.2
of Management's Discussion and Analysis filed with the Q1 Financial
Statements)


(3) Au eqv oz is calculated based on metal prices of US$1,325/oz for Au and
US$30/oz for Ag. 

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For additional details on Great Basin Gold and its gold properties, as well as further particulars about the financial and operational update, please visit the Company's website at www.grtbasin.com or contact Investor Services: