Amarillo Closes Non-Brokered Private Placement for $4.1 Million in Proceeds, Oversubscribed

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Sept. 12, 2012) - Amarillo Gold Corp. (TSX VENTURE:AGC) ("Amarillo" or the "Company") is pleased to announce that, subject to regulatory approval, it has closed its non-brokered private placement financing (the "Private Placement") of 5,467,134 common shares of the Company at a price of $0.75 (seventy five cents) per share, for aggregate proceeds of $4,100,350.75. The Private Placement closed in two tranches. The Company issued 2,692,134 common shares in the first tranche, which closed on September 7, 2012, for proceeds of $2,019,100.75. The Company issued 2,775,000 common shares in the second tranche, which closed on September 12, 2012, for proceeds of $2,081,250. All currency references are in Canadian dollars.

In total 2,692,134 of the securities issued in connection with the closing of the offering are subject to a restricted period that expires January 8, 2013, and 2,775,000 of the securities issued connection with the closing of the offering are subject to a restricted period that expires January 13, 2013, in accordance with applicable securities laws.

Buddy Doyle, CEO and President of Amarillo Gold, said, "The Company is pleased to report that the financing was oversubscribed which is noteworthy in this difficult market. The financing is thus a testimony to the continued belief and support from those key existing shareholders who provided the majority of these funds. The funds raised will be primarily used to keep the Mara Rosa project moving forward to feasibility. This work will include an updated resource statement, and feasibility-level metallurgical and geotechnical studies from the Posse deposit, as well as continuing environmental permitting and community-relations work. The Company also expects to complete an updated resource estimate at its Lavras do Sul project in southern Brazil during this period."

Two separate groups will be paid a 6% finders fee and receive 6% brokers warrants on separate portions of the money raised, subject to exchange approval.

About Amarillo Gold Corp.

Amarillo Gold Corp. is focused on acquisition, discovery, and definition of gold resources in Brazil. The Company's principal projects are the Mara Rosa Project in the state of Goias, and the Lavras do Sul Project in the state of Rio Grande do Sul. The Posse Deposit at Mara Rosa contains 1,174,900 ounces of measured and indicated gold contained in 20.85 MT at 1.75 g/t Au, and 156,400 ounces of gold inferred from 3.63 MT at 1.38 g/t Au (0.5 g/t cut-off grade) (NI 43-101 compliant resource as independently determined by Australian Exploration Field Services Pty. AEFS). The Mara Rosa Gold Project has received a positive economic assessment from a Pre-feasibility study and is preparing to proceed to a bankable feasibility study. Should this continue to be positive it would be possible to commence mining by 2014.

The Posse Deposit was successfully mined by Western Mining Company (WMC) during the 1990s (mined areas are excluded from the above-stated resource figures), and is located in an area of excellent infrastructure: approximately 35 km NE of Yamana's Chapada open pit Cu-Au operation, some 80 km NE of Yamana's Pilar Au project (in Feasibility), 95 km NW of Votarintim's Niquelandia Ni laterite mine, 105 km from NE of Serra Grande's underground Au mine, and 105 km NNW of Anglo American's Ni laterite project at Barro Alto.

The Lavras do Sul Project is an advanced exploration stage property (190 sq. km.) comprising more than 19 prospects centred on historic gold workings, with encouraging gold mineralization discovered and defined by more than 16,000 metres of drilling. The initial resource estimate at the Butia prospect reported 215,000 ounces of gold indicated from 6.4 MT at 1.05 g/t Au, and 308,000 ounces of gold inferred from 12.9 MT at 0.74 g/t Au using a0.3 g/t cut-off grade in a NI 43-101 compliant resource as independently determined by Atticus Consulting 2010. Lavras do Sul is also located near excellent infrastructure. The Company also has a portfolio of earlier stage projects and all properties under Amarillo's management are located in areas of good infrastructure and mining-friendly communities.

ON BEHALF OF THE BOARD OF DIRECTORS

AMARILLO GOLD CORP.

Buddy Doyle, President

FORWARD-LOOKING STATEMENTS:

This news release contains forward-looking statements regarding our intentions and plans. Various factors may prevent or delay our plans, including but not limited to, contractor availability and performance, weather, access, mineral prices and success and failure of the exploration and development carried out at various stages of the program. The Company has not made any studies towards determining if the gold mineralisation at the Butia prospect can be economically exploited at this stage. The prospect is still in the advance exploration stage. Permission from the Government and community is also required to proceed with future mining production. Despite promising results, there is no assurance that the Company can mine its properties profitably. Readers should review risk factors applicable to junior mining exploration companies generally to understand the variety of risks that can affect the Company.