Rio Novo Gold Announces Termination of Offering

TORONTO, ONTARIO--(Marketwire - March 6, 2012) -

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Rio Novo Gold Inc. (TSX:RN)(TSX:RN.WT) ("Rio Novo" or the "Company") wishes to announce that it has agreed to terminate the underwriting agreement with a syndicate of underwriters led by Canaccord Genuity Corp. and including Clarus Securities Inc., Dundee Securities Corporation, GMP Securities L.P., and UBS Securities Canada Inc. in respect of its previously announced $20,025,000 bought deal financing, and that the Company will not be proceeding with the offering at the present time.

The Company will continue to advance its exploration work at its mineral properties in Brazil and Colombia as planned and is considering alternative financing opportunities. Rio Novo has a cash balance of over $28,000,000 and will fund its exploration, engineering and operating expenses from its working capital. The Company expects its Almas Preliminary Economic Assessment ("PEA") from Pincock, Allen & Holt to be delivered the week of March 12, 2012.

About Rio Novo

Rio Novo is focused on the acquisition, exploration and development of gold properties in Brazil and Colombia. The Company has Measured & Indicated resources of 961,711 oz and 1,178,016 Inferred oz of gold in Brazil and Colombia.

The Company's goal is to become a producer of gold by bringing into production its two Brazilian properties, the Almas Gold Project, located in the State of Tocantins, and the Guarantã Gold Project, located in the State of Mato Grosso. Both projects enjoy established infrastructure and main grid hydropower in mining friendly jurisdictions.

In June 2011, the Company completed the 100% acquisition of the Toldafria property in Caldas State in the central Cordillera. The Toldafria property has an Inferred resource of 952,000 oz gold at a grade of 2.38 g/t as set out in a NI 43-101 compliant resource estimate. At Toldafria, the Company executed a systematic program of trenching, mapping, underground channel sampling, and plans to begin drilling this March to determine the vertical and horizontal continuity and the extent of the Toldafria deposit.