Homeland Energy Group Ltd.

Homeland Energy Group Ltd.

November 18, 2008 08:00 ET

Homeland Energy Notifies GMR of Intention to Issue Shares

TORONTO, ONTARIO--(Marketwire - Nov. 18, 2008) - Homeland Energy Group Ltd. (TSX:HEG) ('Homeland' or 'the Company') announces that it has given notice to GMR Energy of Bangalore, India that the company intends to issue Homeland Energy Group shares at a price of approximately C$0.455/share as a means for Homeland to regain 100% of Homeland Mining & Energy SA (PTY) Ltd. (HMESA). These shares would satisfy the repayment of GMR's US$30 million investment for 10% of HMESA. The total number of shares is to be determined in accordance with the exchange rate provisions of the share purchase agreement.

On Nov 5, 2008, Homeland Energy announced that GMR of India had elected not to exercise the third of three options to purchase 40% of Homeland Mining & Energy, South Africa for US$135 million. Homeland also announced its intent to repurchase GMR's current 10% ownership in accordance with the terms of the Share Purchase Agreement. Under the Share Purchase Agreement, Homeland has the ability to satisfy the obligation in cash or in shares of the Company on an average price as noted above. The Company has until January 4, 2009 to make the repayment and management continues to actively pursue alternate actions with a view to limiting dilution to shareholders.

This share issuance is subject to a vote of shareholders to be held on December 30, 2008 with a record date of November 24, 2008.

Kendal Colliery Production Update

Homeland maintains a focus on ramping up Kendal Colliery to full production of 150,000 tonnes per month of run-of-mine coal by early 2009. Kendal is currently on track for full production in early 2009 with anticipated November production at 80,000 run-of-mine tones. This is slightly less production than expected due to heavy rains in the first ten days of the month. For November, Homeland anticipates the sale of 40,000 tonnes of beneficiated high-quality thermal coal. Kendal began production in July 2008 and has 1-year contracts for approximately 500,000 tonnes at approximately 700 Rand per tonne for delivery into late 2009.

Exploration and mine development programs are carried out under the supervision of Mr. Mike Nell, Chief Operating Officer, Homeland Energy Group Ltd. Mr. Nell, a professional mining engineer and "Qualified Person" as defined under National Instrument 43-101, has reviewed and verified the technical content in this press release.

Homeland Energy Group Ltd. (TSX:HEG) is a coal producer with operations the Witbank area of South Africa. The company also has a large-scale development property in South Africa and exploration interests in Southern Africa. Homeland is currently negotiating to acquire interests in a number of additional coal properties in eastern South Africa and neighbouring countries as well as in the United States. Homeland is a significant shareholder in Homeland Uranium Inc., a Canadian uranium exploration and development focused on projects in Niger and the United States. Homeland also has an aggressive global acquisition strategy with a focus on energy resources.

Homeland Energy Group Ltd. is currently traded on the Toronto Stock Exchange under the symbol "HEG" with 150,079,642 common shares issued and outstanding. www.homelandenergygroup.com.

Forward-Looking Statements

"This press release contains or refers to forward-looking information, including statements regarding the estimation of mineral resources, exploration results, potential mineralization, exploration and mine development plans, timing of the commencement of operations and estimates of market conditions, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to, failure to convert estimated mineral resources to reserves, the grade and recovery of ore which is mined varying from estimates at the Kendal Colliery, capital and operating costs varying significantly from estimates, the preliminary nature of metallurgical test results, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects and the other risks involved in the mineral exploration and development industry. Forward-looking statements are subject to significant risks and uncertainties, and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and the Company assumes no responsibility to update them or revise them to reflect new events or circumstances other than as required by law."

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