Placing

Mercator Gold PLC
17 October 2007



   NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES,
    CANADA,  THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND OR JAPAN



                                Mercator Gold plc
                                        
      Placing of Convertible Loan Notes to raise approximately £2.6 million


LONDON: 17 October 2007 - Mercator Gold plc ('Mercator' or the 'Company')
(MCR.L) announces the placing (the 'Placing') of convertible loan notes
('Notes') with institutional investors to raise approximately £2.6 million
before expenses.

The Notes carry interest of 8.5% per annum, will be redeemed at par on or before
16 October 2010 and are convertible into ordinary shares in the Company
('Ordinary Shares') at a conversion price of 95p per Ordinary Share at any time
on or after the first anniversary of their issue and at 120p per Ordinary Share
at any time on or after the second anniversary of their issue. The closing
mid-market price of an Ordinary Share on 16 October 2007 was 82p. Cenkos
Securities plc, Ocean Equities Limited and Loeb Aron & Company Limited acted for
the Company in the Placing of the Notes, which will not be admitted to trading
on AIM.

Funds will be used to expedite pre-stripping at the Bluebird deposit and to
drill the Company's Euro Project. Commissioning of the Company's Bluebird Mill
is now well-advanced with production ramping up according to the Company's
schedule. Mill throughput of up to 240t/hour has been achieved whilst
metallurgical recoveries have exceeded planned levels of 90%.

Patrick Harford, Managing Director of Mercator Gold, commented:

'Mercator is keen to proceed with the opening up of the Bluebird Pit and to
drill the Euro Project. These projects will underpin the Company's objective of
producing 120,000 ounces of gold over the next 12 months.'


For further information contact:

Mercator Gold plc
Terry Strapp, Chairman                     Tel: [phone]
Patrick Harford, Managing Director         Tel: [phone] 
                                           Mob: [phone]
Email: [e-mail]
Website: www.mercatorgold.com


Bankside Consultants Ltd    
Simon Rothschild                           Tel: [phone]
Keith Irons
Oliver Winters

Cenkos Securities plc 
Ian Soanes                                 Tel: [phone]
Adrian Hargrave

AIM: MCR

Cenkos Securities plc ('Cenkos'), which is authorised and regulated in the
United Kingdom by The Financial Services Authority, is acting exclusively for
the Company as nominated adviser, joint broker and placing agent in connection
with the Placing. Cenkos is not acting for any other person and will not be
responsible to anyone other than the Company for providing the protections
afforded to clients of Cenkos or for advising any other person in relation to
the Placing. Ocean Equities Limited ('Ocean'), which is authorised and regulated
in the United Kingdom by The Financial Services Authority, is acting exclusively
for the Company as joint broker and placing agent in connection with the
Placing. Ocean is not acting for any other person and will not be responsible to
anyone other than the Company for providing the protections afforded to clients
of Ocean or for advising any other person in relation to the Placing. Loeb Aron
& Company Limited ('Loeb Aron'), which is authorised and regulated in the United
Kingdom by The Financial Services Authority, is acting exclusively for the
Company as placing agent in connection with the Placing. Loeb Aron is not acting
for any other person and will not be responsible to anyone other than the
Company for providing the protections afforded to clients of Loeb Aron or for
advising any other person in relation to the Placing. Neither the Notes nor the
new Ordinary Shares into which the Notes are convertible have been, nor will be,
registered under the United States Securities Act of 1933 (as amended) or under
the securities legislation of any state of the United States of America or of
any province or territory of Canada, Australia, Japan, the Republic of Ireland
or the Republic of South Africa. There will be no public offering of the Notes
or the new Ordinary Shares into which the Notes are convertible in the United
States. Subject to certain exceptions, neither the Notes nor the new Ordinary
Shares into which the Notes are convertible may be directly or indirectly
offered, sold, transferred, taken up or delivered in, into or from the United
States, Canada, Australia, Japan, the Republic of Ireland or the Republic of
South Africa or their respective territories or possessions. This announcement
does not constitute an offer to sell or issue or the solicitation of an offer to
buy Notes or the new Ordinary Shares into which the Notes are convertible in any
jurisdiction in which such offer or solicitation is unlawful. Accordingly,
copies of this announcement are not being and must not be mailed or otherwise
distributed or sent in or into or from the United States, Canada, Australia,
Japan, the Republic of Ireland or the Republic of South Africa and any person
receiving this announcement (including custodians, nominees and trustees) must
not distribute or send it in or into or from the United States, Canada,
Australia, Japan, the Republic of Ireland or the Republic of South Africa. This
announcement has not been approved by Cenkos, Ocean or Loeb Aron for the
purposes of section 21 of the Financial Services and Markets Act 2000. This
announcement has not been examined or approved by The Financial Services
Authority or the London Stock Exchange or any other regulatory authority.




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