Exploration and Joint Venture Agreement

SHANTA GOLD LIMITED
                        ("Shanta Gold" or the "Company")

                                  1 June 2011

 Exploration and Joint Venture Agreement Expanding Shanta Gold's Lupa Gold Camp
                                    Presence

Shanta Gold is pleased to announce that it has today entered into an agreement
with Canadian listed Great Basin Gold Ltd ("Great Basin Gold") under the terms
of which Shanta Gold will acquire an 80% interest in Great Basin Gold's
exploration assets located in the Lupa region of Tanzania (the "Properties") in
exchange for carrying out and funding certain exploration activities on those
Properties and by way of the issue of ordinary shares in the Company to Great
Basin Gold (the "Agreement"). The closing of the Agreement remains subject to
certain conditions precedent, which are identified below.

Under the terms of the Agreement, Shanta Gold will be entitled to explore the
Properties, in the highly prospective Lupa gold camp, which extend over an area
of approximately 3,800 square kilometres and partially lie adjacent to the
Company's New Luika Gold Mine. Great Basin Gold's regional exploration has, to
date, identified seven potential drill targets. Under the terms of the
Agreement, Shanta Gold is required to spend US$12 million over a period of three
years. If Shanta Gold discovers a resource in excess of 500,000 ounces above a
1.5g/t cut off and delivers a feasible mine plan, the expenditure commitment
falls away.

Upon satisfaction of the conditions precedent detailed below, Shanta Gold shall
issue to Great Basin Gold 12,368,584 new ordinary shares in the Company as
consideration for the 80% interest in the Properties. The consideration is
equivalent in value to approximately US$7 million at a price of 35p per share,
being the seven day volume weighted average price ("VWAP") for the period ending
19 May 2011. Following the issue of the new ordinary shares, Great Basin Gold
will have an interest in 6.41 % of the issued share capital of Shanta Gold and
6.01% on a fully diluted basis. In addition, the Company will also issue Great
Basin Gold with 12,368,584 ordinary share purchase warrants to the value of
approximately US$7 million at a strike price of 35p. The warrants have a three
year term, which may be extended if there is an extension to the expenditure
commitment time. A compulsory exercise of the warrants will occur where there is
a decision to proceed with a mine on the Properties.

Furthermore, if Shanta Gold discovers resources totalling in excess of 500,000
ounces of gold above a cut-off of 1.5g/t, it shall make an additional payment to
Great Basin Gold based on US$70 per measured/indicated ounce and US$20 per
inferred ounce contained in a resource estimate based on the NI 43.101 standard
used in Canada. This additional consideration applies during the first 3 years
of the Agreement. The additional consideration, if payable, will be satisfied by
the issue of new ordinary shares in the Company to Great Basin Gold based on a
seven day VWAP determined at the time the payment is made.

The Agreement is subject to various conditions precedent, including board
approvals to implement the Agreement, satisfactory reciprocal due diligence,
regulatory approval where required from the Tanzanian Ministry of  Energy and
Minerals and any stock exchange approvals that may be required.

Exploration activities carried out under the terms of the Agreement will be
managed by a Management Committee consisting of three representatives from Great
Basin Gold and three representatives from Shanta Gold. Exploration activities
under the terms of the Agreement are planned to commence immediately.

Shanta Gold's Chairman, Walton Imrie, commented:

"I welcome this relationship with Great Basin Gold. Shanta Gold's proven on-the-
ground exploration track record has culminated in the start of construction of
the New Luika Gold Mine based on a resource of 1.23 million ounces. This has
been achieved within a four year time span at a discovery cost of less than
US$10 per ounce. The combination of Shanta Gold's local geological prowess with
Great Basin Gold's regional geological and exploration expertise, provides
significant potential for further discoveries in the Lupa gold camp. This could
culminate in a second gold mine in the area and would simultaneously provide the
impetus to shift Shanta Gold's status to that of a mid-tier producer.

The strategic model of rapid progress from grass roots exploration to mine
development and low cost mine construction provides the opportunity of
delivering significant shareholder returns.''


For further information:

Shanta Gold Limited              Great Basin Gold Limited


http://www.shantagold.com        

http://www.greatbasingold.com

Walton Imrie                     Ferdi Dippenaar
Mobile: [phone]      Tel: +27  (0) 11 301 1840

Walter Vorwerk                   Michael Curlock
Mobile: [phone]      Tel: +1 [phone]

Gareth Taylor
Mobile: [phone]

Fairfax I.S. PLC
Ewan Leggat/Laura Littley
[phone]







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Source: Shanta Gold Limited via Thomson Reuters ONE

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