AndeanGold Signs Memorandum of Understanding with Gitennes Providing an Opportunity to Acquire a 100% Interest in the Urumalqui Ag-Au Project, Peru

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 01/23/12 -- AndeanGold Ltd. ('the Company' or 'AndeanGold') (TSX VENTURE: AAU) is pleased to announce that it has signed a Memorandum of Understanding (the 'MOU') with Gitennes Exploration Inc. ('Gitennes') to acquire Gitennes' 40% interest in the Urumalqui Ag-Au Project (the 'Project'). Pursuant to an existing Option Agreement (the 'Option') between the parties dated April 21, 2010 (see news release dated April 22, 2010), AndeanGold presently has the right to earn a 60% interest in the Project.

Mr. Anthony F. Ciali, President & CEO states, 'We are extremely pleased to now have the opportunity to acquire a 100% interest in the Urumalqui Project. This will greatly facilitate our objective to develop the Urumalqui Vein to the initial development stage as soon as practicable, an important step forward in the overall development of the Project. The NI 43-101 inferred mineral resource for the Urumalqui Vein released in December 2011 was very encouraging, and we are actively working on the potential for improving and expanding that resource, as well as exploring the other previously indentified mineral vein structures located on the project, where there has only been limited exploration.'

The parties will proceed to sign a Share Sale and Mining Agreement (the 'Agreement') whereby AndeanGold will acquire all of the issued and outstanding shares (the 'Shares') of an offshore holding company of Gitennes that owns all of the issued and outstanding shares of Minera Corimalqui S.A., the Gitennes indirect Peruvian subsidiary that is the titleholder of the Project's concessions. The Shares will be subject to reconveyance to Gitennes should AndeanGold either not fulfill its obligations under both the Option and the Agreement or elect to terminate the Agreement while fulfilling its obligations under the Option.

Pursuant to the terms of the MOU, the Company will make the following payments to Gitennes:

                                                  CASH                 SHARE
                                              PAYMENTS              PAYMENTS
                                     -----------------     -----------------
                                     -----------------     -----------------

ON SIGNING MOU                               $ 125,000                     -

ON SIGNING AGREEMENT                           125,000               200,000

6 MONTHS POST SIGNING AGREEMENT                250,000               200,000
12 MONTHS POST SIGNING AGREEMENT               350,000               250,000
18 MONTHS POST SIGNING AGREEMENT               400,000               250,000
24 MONTHS POST SIGNING AGREEMENT               500,000               500,000
30 MONTHS POST SIGNING AGREEMENT             1,000,000               600,000
                                     -----------------     -----------------

TOTAL PAYMENTS                             $ 2,750,000             2,000,000
                                     -----------------     -----------------
                                     -----------------     -----------------

On AndeanGold's unconditional vesting in 100% of the Shares, Gitennes shall be entitled to a 1% Net Smelter Returns royalty (the 'Royalty') on the Project. The obligation of AndeanGold to pay the Royalty shall irrevocably terminate upon the receipt by Gitennes of aggregate payments under the Royalty of $1,250,000.

This transaction is subject to acceptance by the TSX Venture Exchange and, possibly, the approval of Gitennes' shareholders.

About AndeanGold Ltd:

AndeanGold Ltd. is engaged in the acquisition, exploration and potential development of primarily precious metals properties, principally in Peru and Ecuador. The focus of the Company's exploration activities is presently in advancing its Urumalqui Project, as well as pursuing mineral property acquisitions, in Peru. In Ecuador, the Company's activities have been limited to administrative and legal matters due to the Mining Mandate issued by the Ecuador Constituent Assembly on April 18, 2008. In November 2009, President Correa signed the Mining Regulations into law pursuant to the requirements of the new Mines Law, which was passed in January 2009. This was the final legal precursor to the re-initiation of exploration and mining development in Ecuador. The Company has been issued new mining titles under the new Mines law to its three key Ecuadorian projects and has filed the requisite documents with the Ministry of Non-Renewable Natural Resources and Ministry of Environment in support of the Company's request to renew exploration programs on its key projects in Ecuador. The Company is actively working with government officials to achieve this end.

Please refer to AndeanGold's website at www.andeangoldltd.com for further information on the Company's projects and activities.

On Behalf of the Board of Directors of ANDEANGOLD LTD.

Anthony F. Ciali, President, CEO and Director

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts:

Corporate Office:

AndeanGold Ltd.

Tony Ciali

732.940.5487
tciali@andeangoldltd.com
www.andeangoldltd.com


Investor Relations:

Ascenta Capital Partners Inc.

Jim Glass

604.684.4743 ext. 225 or Toll free: 1.866.684.4743 ext. 225
jim@ascentacapital.com