CHUNYA PROJECT METALLURGICAL OPTIMISATION STUDY RESULTS

SHANTAGOLD LIMITED
                          ("Shanta" or the "Company")
 
          CHUNYA PROJECT METALLURGICAL OPTIMISATION STUDY RESULTS SHOW
 
                           OPTIMUM RECOVERIES OF 90%
 
13 January 2010
 
Shanta   is   pleased  to  announce  the  completion  of  initial  metallurgical
optimisation  studies  on  ore  samples  from  its  Chunya  project  in southern
Tanzania.   The test work, conducted by independent verification consultants SGS
South Africa (Pty) Ltd, was aimed at establishing whether a bulk combined sample
(ROM sample) would be amenable to gravity concentration and gold dissolution. In
addition  a recently discovered surface rubble zone at the Luika site within the
Chuya  orebody has been  evaluated and the  metallurgical characteristics tested
and found to be similar to that of the in situ ore at Chunya.
 
Highlights include:
 
  * Gravity  concentration recovery of 35% with gravity plus leaching of gravity
    tails yielding a maximum recovery of 88%.
 
  * ROM dissolution tests show maximum  leach recovery of 90%.
 
  * Optimum leach conditions identified.
 
  * The  range of  recoveries has  been more  tightly defined providing a higher
    level of confidence to the parameters used in the mining study.
 
  * Results will be used in the Feasibility Study that is currently underway and
    due to be completed in the 1st quarter 2010.
 
  * The  rubble zone at Luika is estimated to contain 17,000 ounces of gold with
    a  maximum leach recovery of 93%, a  marginally improved recovery to that of
    the ROM sample.
 
Gravity Test
 
Gravity  concentration  of  the  ROM  composite  derived from the RC drill chips
yielded  a concentrate  that contained  34.94% of the  gold. Under  excess leach
conditions  the  gravity  tails  dissolution  was 87.44%. The calculated gravity
circuit recovery achieved a maximum total gold dissolution of 87.61%.
 
ROM Dissolution Test
 
The  dissolution tests showed the optimum leach  conditions on the ROM sample to
be  an 80% passing -53µm grind, cyanide addition of 2kg/t, and 48 hour residence
time with oxygen sparging.  These conditions returned a maximum gold dissolution
of 89.93% with a cyanide consumption of 0.84kg/t NaCN.
 
Improved Metallurgical Definition
 
Previous   mineralogical   and   gold   deportment   studies   with  preliminary
concentration  and dissolution  tests on  individual samples  from the prospects
returned  recoveries ranging  between 81% and  88% and gravity  test work on the
same yielded recoveries that varied between 17% and 44% (at an 80% -75µm grind).
These  new  results  much  more  clearly  define the metallurgical nature of the
deposit  and will be  very important in  helping progress the Mining Feasibility
Study  currently underway and which is expected to be completed during the first
quarter of 2010.1st quarter 2010
 
Free dig horizon identified and tested
 
During 2009 the exploration at Luika on the Chunya property delineated a surface
rubble  horizon containing approximately  500,000 tonnes of material. Systematic
pitting  and sampling was conducted. Screening  of this sample material to +10mm
showed  38% of the material (an estimated 180,000 in  situ tonnes) to be in this
size  fraction.  Analysis  has  defined  an  estimated  17,000 ounces of gold at
2.97g/t. A  20t bulk  sample  of  the  rubble  material has been metallurgically
tested  at the Mintek laboratory in South Africa.. The sample was screened and a
composite  sample of  crushed material  from the  +10mm size fractions milled to
80% -75  µm. Cyanide  leaching returned  a maximum  dissolution of 93% and. this
free  dig  material  is  expected  be  an  important  component  of  early plant
operations  and may be stockpiled during open pit preparation pre-stripping.  It
should  be  available  for  immediate  treatment  with  the  start-up  of  plant
operations.
 
For further information:
 
Shanta Gold Limitedhttp://www.shantagold.com
 
Walton Imrie
Mobile: +27 (0) 82 444 2851
 
David Scott
Mobile: + 255 (0) 784 366146
 
Fairfax I.S. PLC
Ewan Leggat / Laura Littley
+44 (0)20 7598 5368
 
[HUG#1376352]