Mahdia Gold Corp.
CNSX : MGD

Mahdia Gold Corp.

September 11, 2012 12:37 ET

Mahdia Gold Corp (CNSX:MGD) Clarifies Disclosure on Mahdia Gold Property in Guyana

TORONTO, ONTARIO--(Marketwire - Sept. 11, 2012) - Mahdia Gold Corp. (the "Company") (CNSX:MGD) announces that as a result of a review by staff of the Ontario Securities Commission (the "OSC"), the Company is issuing the following press release to clarify its disclosure regarding the recently filed Omai Geological Report and its news release dated May 30, 2011 with respect to the Omai gold property.

The Company wishes to clarify that the July 12, 2012 Omai Geological Report prepared by AMEC and filed on SEDAR is not a technical report as defined by NI 43-101. The Company is working closely with AMEC to prepare a revised report addressing the identified deficiencies. The revised report will be a technical report prepared in compliance with NI 43-101 and will be filed on SEDAR shortly. The Company has also updated its website (which may be accessed at www.mahdiagold.com) to address the deficiencies identified by the OSC.

In addition, the Company disclosed in its May 30, 2011 news release "…a resource of 17.5 Mt @ 2.51 g/t for an additional deposit of 1.4 million ounces of gold available for Mahdia Gold to develop…". The Company also stated that it "…is elevated from being an exploration company to a near term producer…". These two statements were subsequently reproduced on page 6 of the Company's management discussion and analysis for the nine months ended February 29, 2012 and on page 5 of the Company's management discussion and analysis for the year ended May 31, 2012. The Company's website also reports the resource estimate on the Omai Property page entitled "Omai Gold Mine" in a manner that makes it appear as a current estimate.

The historical estimates are not current and do not meet the standards prescribed by NI 43-101. They provide an indication of the potential of the properties only and are relevant only in the context of ongoing exploration and evaluation. The entire text of the news release dated May 30, 2011 should be replaced with the following clarifying disclosure:

"Mahdia Gold Corp. ("Mahdia") is pleased to announce that it has successfully negotiated with the government of Guyana to acquire the right to obtain a prospecting license on the Omai gold mine property, which is divided into two pits: the Fennell pit and the Wenot pit. The Omai gold mine may also cover additional deposits, according to reports and data collected during the previous operation of the mine. Mahdia intends to work closely with the government of Guyana to interpret the data and better understand the historical results in order to develop a successful and productive exploration program going forward.

The Omai gold mine was most recently operated by IAMGOLD Corporation ("IAMGOLD"), after acquiring rights to it from Cambior Inc. From 2006 to 2007, IAMGOLD drilled the floor of the Fennell pit with a total of 46 diamond drill holes (27,359m), up to a maximum length of 967m. Other work was done that consisted of specific gravity measurements, significant geotechnical work, and the creation of a three-dimensional Gemcom model of the Sill, Fennell Stock and mineralized zones. To the knowledge of management, there are no current NI 43-101-compliant mineral resources on the Omai gold mine property. Management is only aware of a historic mineral resource model and accompanying internal report for the Fennel underground, completed by IAMGOLD in 2007. There is no reference in the internal report that the model is compliant with NI 43-101 or that the model and mineral resource estimate based on that model have been endorsed by an independent third party as being compliant with NI 43-101, and therefore should not be relied upon as a current mineral resource for the Fennel Deep mineralization.

This property will require considerable further evaluation, which Mahdia's management and consultants intend to carry out in due course.

The second pit nearby, the Wenot pit, was never drilled but it shares a similar geology as the Fennel pit and, in the opinion of management, necessitates a full and comprehensive investigation to establish the potential of the Wenot pit.

David Bending, the President and a director of Mahdia, manages the company's exploration program and is the Qualified Person as defined by NI 43-101. He supervised the preparation of the technical information in this release."

The Company has reviewed the deficiencies identified by the OSC and has already provided an initial written response to the OSC.

The Company's qualified person, David Bending, the President of the Company, has reviewed the technical content of this news release.

About Mahdia Gold Corp.

Mahdia is a Canadian-based gold exploration company with interests in three gold-bearing concessions in central Guyana, namely Omai, Tiger River, and White Creek.

Forward-Looking Statements

Information set forth in this news release may involve forward-looking statements under applicable securities laws. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The forward-looking statements included in this document are made as of the date of this document and the Corporation disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation. Although Management believes that the expectations represented in such forward-looking statements are reasonable, there can be no assurance that such expectations will prove to be correct. This news release does not constitute an offer to sell or solicitation of an offer to buy any of the securities described herein and accordingly undue reliance should not be put on such. Neither CNSX Exchange nor its Regulation Services Provider (as that term is defined in the policies of the CNSX) accepts responsibility for the adequacy or accuracy of this release.

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