Exploration Strategy

EXPLORATION STRATEGY
                          12 December 2008
The Board of Shanta has recently conducted a review of the Company's
gold exploration activities in Tanzania and developed its business
strategy for the ensuing period in what is likely to be a difficult
funding environment. The review included an assessment of the
resources available to conduct the envisaged programmemes, the
historical and current strategy of the Company, and consideration of
the investment market particularly with respect to raising further
exploration funding by the conventional market means.
In summary, it was concluded that Shanta will continue to add value
to its assets while maintaining a medium-term secure cash position
and investigating and, if justified, developing alternative sources
of finance, initially through possible small scale mining.
Shanta's Business Strategy
The strategy proposed and accepted by the Board of the Company for
the foreseeable future was developed at a strategy meeting held in
October.
Shanta's primary goal is to increase shareholder value by adding
value to the Company's exploration holdings through a strategy of
successful exploration that will generate economic resources.
Pursuant to this goal, drilling at Singida and Chunya in the past
eighteen months has successfully delineated a possible gold resource
of some 1.25M ounces (of which around 0.53M ounces are JORC compliant
and a further potential .72M ounces await the completion of JORC
requirements) at these sites and identified further considerable
potential to grow the resources at these sites and move the projects
towards production.
This revised strategy must be executed in the context of the present
uncertain world financial markets in which poor stock prices for
exploration companies and concomitant low valuations that severely
constrain funding options available to junior explorers. Accordingly
the Board is determined to ensure that the cash available to the
Company to conduct its business is sufficient to do so until the
markets are more favourable and additional funding sources can be
secured. The Board has therefore formulated a revised strategy aims
to ensure that the Company secures its cash position and continues to
add value to the assets through:
    Continuing to increase the resources albeit more slowly;
    Conducting early stage pre-feasibility studies which will advance
selected projects closer to production, with a view to establishing
one or more small to medium sized mining operations on the basis of a
combination of internal cash and project financing;
    Seeking serviceable second hand mining and recovery equipment
that may be quickly and efficiently deployed at suitable sites;
    Following the points above, commissioning one or more small to
medium sized mining operations to provide a cash flow funding source
for exploration projects; and
    Sourcing additional funds to continue exploration activities when
the market supports a share price at suitable valuations and possible
alternative funds through means such as farm-in or joint venture
programmes.

To achieve this outcome the Company is implementing the following
activities:
      Increase the resources at Singida and Chunya with limited
drilling of extensions to identified resources, targeting a total
economic and compliant gold resource at each of these sites of a
minimum of 1 million ounces;
      Complete limited first pass work at other properties
(particularly Chunya-Mbeya and Songea);
      Conduct initial pre-feasibility activities on Chunya and
Singida;
      Investigate the feasibility of, and if found positive, develop
a small mining operation on the Luika Mine property to underpin the
cash resources; and
      Access Mgusu when possible and conduct a drilling programme to
confirm and possibly extend the known resource which currently stands
at 0.72 million ounces.

A new activity plan and budget are in preparation and due for
implementation by the time the new exploration seasons commences in
January. The Company's cash balance at present is $6.9m.
To further support the implementation of the strategy, the Company
has appointed Mr David Scott, currently a non-executive director of
the Company with extensive mining, geological exploration and
management experience, as an executive director of the Company.


For further information:

Shanta Gold Limited 

http://www.shantagold.com

Walton Imrie
Mobile: [phone]

Walter Vorwerk
Mobile: [phone]

GMP Securities Europe LLP,
James Hannon
[phone]

Panmure Gordon (UK) Limited
Edward Farmer
[phone]

---END OF MESSAGE---




This announcement was originally distributed by Hugin. The issuer is 
solely responsible for the content of this announcement.