Compass Gold Corporation Completes Acquisition of Africa Mining

VANCOUVER, BRITISH COLUMBIA -- (Marketwire - Dec. 13, 2011) - Compass Gold Corporation (TSX VENTURE: CVB) (the “Company“) announces that it has completed the transaction involving the acquisition by the Company of the remaining 49% equity interest in Africa Mining SARL (“Africa Mining“) from Transocean Finance Pty Ltd. (controlled by James Henderson) and Madani Diallo (together, the “Sellers“), further to the Company's news release dated December 7, 2011 (the “Transaction“).

At the closing of the Transaction today (the “Closing“), the Company issued a total of 30,000,000 common shares (the “Shares“) and 10,000,000 share purchase warrants (the “Warrants“) of the Company to the Sellers in consideration for the acquisition, through the Company's subsidiary Compass Gold (BVI) Mali Corp., of the remaining 49% interest in Africa Mining, which is now an indirect, wholly-owned subsidiary of the Company. Each Warrant entitles the holder to purchase one common share of the Company at a price of $0.30 per share until December 13, 2015.

The Shares and Warrants have been placed in escrow and will be released as to 10% effective at the Closing and 15% every six months thereafter for a period of three years, pursuant to the terms of a TSX Venture Exchange escrow agreement with Computershare Investor Services Inc. acting as escrow agent. The Shares and Warrants are also subject to a four-month hold period expiring on April 14, 2012 in accordance with applicable Canadian securities laws.

Pursuant to the terms of the Transaction, at the Closing the Sellers granted to the Company the right to reduce the existing net smelter returns royalty held by the Sellers over Africa Mining's Yanfolila, Dandoko and Kolondieba properties, from a 2% royalty to a 1% royalty through the payment of $1,000,000 at any time within five years following the Closing.

As the Sellers are insiders of the Company, the Transaction is a “related party transaction“ under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions. The requisite minority shareholder approval of the Transaction was obtained on December 7, 2011 as announced on that date. Full details of the Transaction are contained in the Company's Information Circular dated November 2, 2011 (available at www.sedar.com).

After giving effect to the Transaction, there are 110,665,340 common shares of the Company issued and outstanding, of which 15.8% are held by Dr. Diallo and 18.5% are beneficially held, directly or indirectly, by Mr. Henderson, all on a non-diluted basis. On a partially-diluted basis assuming the exercise of outstanding warrants (including without limitation the Warrants) and stock options held by Messrs. Diallo and Henderson as at the Closing, 20.7% of the outstanding shares are held by Dr. Diallo and 23.6% of the outstanding shares are beneficially held, directly or indirectly, by Mr. Henderson. Please refer to the early warning reports being filed by Messrs. Diallo and Henderson for further details of their holdings in the Company on completion of the Transaction.


About Compass Gold Corporation

Compass Gold Corporation is a Tier 2 mining issuer listed on the TSX Venture Exchange and focused on gold exploration in Mali, Africa's 3rd largest producer of gold. Compass, through its wholly-owned subsidiary Africa Mining, owns four gold exploration permits (Yanfolila, Dandoko, Kolondieba and Solabougouda) as well as an authorization to explore, Mousala, covering a total of 888 sq km's in key gold producing regions in south west Mali, West Africa. Further information is available at www.compassgoldcorp.com.


COMPASS GOLD CORPORATION

James Henderson
President



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



Contact Information

Compass Gold Corporation
Darren Devine
1-604-638-8067
1-604-648-8105 (FAX)
info@compassgoldcorp.com
www.compassgoldcorp.com