Gold Properties Revert to Tanzanian Royalty Following Termination of Option Agreement with Kibo Mining

Tanzanian Royalty Exploration reports that negotiations with UK-listed
Kibo Mining to extend the schedule of option payments and exploration
expenditures for the Itetemia and Luhala gold prospects have failed to
produce an equitable agreement. As a result, both properties, along with
their respective databases, will be returned to Tanzanian Royalty.

According to James E. Sinclair, President and CEO of Tanzanian Royalty,
'The Company regrets that Kibo Mining was unable to fulfill the
conditions for retaining its options on the Itetemia and Luhala
properties even though we were exceedingly generous in allowing them
extra time to reach an accommodation with us.?

Itetemia comprises prospecting licenses in the Shinyanga Region in
northern Tanzania. The property is situated just five kilometres east of
Barrick Gold′s Bulyanhulu Gold Mine (16 million ounce gold resource)
which has been operating since 2001.

The main gold prospect on Itetemia is the Golden Horseshoe Reef (GHR)
which Kibo has been evaluating as a potential open pit mining operation.
Kibo describes its preliminary economic assessment for Itetemia as
'robust? and Mr. Sinclair confirms that an immediate priority for
Tanzanian Royalty will be the preparation of a NI 43-101 compliant
Technical Report for the project which will 'enable further development
and enhancement on an accelerated basis of the production model
considered by Kibo.?

Also returned to the Company was the Luhala Gold Prospect in the Mwanza
region of Tanzania. In 2010, Kibo completed a 1,500m drill program at
Luhala to test for the continuation of a zone of shallow dipping gold
mineralization in the Kisunge East area. Kibo has stated publicly that
the results from this drilling 'were very encouraging and confirmed the
down-dip continuity of mineralization at this locality.?

Qualified Person

The Company′s Qualified Person, Mr. Peter Zizhou, has reviewed and
approved the contents of this news release. Mr. Zizhou is the General
Manager (Exploration & Admin) of Tanzanian Royalty Exploration
Corporation Limited. He has a Master of Science (Exploration Geology)
degree from the University of Zimbabwe (2000) and is a registered
scientist with SACNASP (Reg. No.400028/08).

Respectfully Submitted,

James E. Sinclair

President and Chief Executive Officer

For further information, please contact Investor Relations at
1-800-811-3855

Visit our website: www.TanzanianRoyalty.com

The Toronto Stock Exchange and NYSE Amex Equities have not reviewed and
do not accept responsibility for the adequacy or accuracy of this release

Cautionary Note to U.S. Investors - The United States Securities and
Exchange Commission limits disclosure for U.S. reporting purposes to
mineral deposits that a company can economically and legally extract or
produce. We use certain terms on this news release, such as 'reserves?,
'resources?, 'geologic resources?, 'proven?, 'probable?, 'measured',
'indicated', or 'inferred' which may not be consistent with the reserve
definitions established by the SEC.U.S. Investors are urged to
consider closely the disclosure in our SEC filings.You can
review and obtain copies of these filings from the SEC's website at http://www.sec.gov/edgar.shtml

This news release contains certain forward-looking statements and
forward-looking information. All statements, other than statements of
historical fact, included herein are forward-looking statements and
forward-looking information that involve various risks and
uncertainties. There can be no assurance that such statements will prove
to be accurate, and actual results and future events could differ
materially from those anticipated in such statements. Important factors
that could cause actual results to differ materially from the Company's
expectations are disclosed in the Company's documents filed from
time-to-time with the British Columbia, Alberta and Ontario provincial
securities regulatory authorities.

Certain information presented in this release may constitute
'forward-looking statements? within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking
statements are based on numerous assumptions, and involve known and
unknown risks, uncertainties and other factors, including risks inherent
in mineral exploration and development, which may cause the actual
results, performance, or achievements of the Company to be materially
different from any projected future results, performance, or
achievements expressed or implied by such forward-looking statements.
Investors are referred to our description of the risk factors affecting
the Company, as contained in our SEC filings, including our annual
report on Form 20-F and Registration Statement on Form F-10, as amended,
for more information concerning these risks, uncertainties, and other
factors.

Tanzanian Royalty Exploration

David Duval, 1-800-811-3855

Investor
Relations

or

Connecticut Office:

Tel: (860)
364-1830

Fax: (860) 364-0673

or

South Surrey Office:

Toll
Free: 1-800-811-3855

Tel: (604) 536-7873

Fax: (604) 536-2529

Email:
investors@TanzanianRoyalty.com

Website:
www.TanzanianRoyaltyExploration.com