AndeanGold Announces Closing of $645,000 Private Placement

VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 08/31/12 -- AndeanGold Ltd. (TSX VENTURE: AAU) ("the Company" or "AndeanGold") is pleased to announce that the Company has increased its previously announced non-brokered private placement (the "Placement") (news releases of July 6, 2012 and July 16, 2012) from $500,000 to $645,000 and has closed (the "Closing") the final tranche of the Placement. Under the Placement, the Company issued an aggregate of 12,900,000 units ("Units") at a price of $0.05 per Unit. Each Unit consists of one common share and one-half share purchase warrant. Each warrant will entitle the holder to purchase one additional common share of the Company for a period of eighteen months from the respective Closing of each tranche at a price of $0.10 per share.

Pursuant to the second tranche of the Placement, the Company issued an aggregate of 5,700,000 Units to raise aggregate gross proceeds of $285,000. The first tranche of the Placement closed on July 16, 2012 and involved the issuance of an aggregate of 7,200,000 Units to raise aggregate gross proceeds of $360,000.

In accordance with applicable securities laws and the policies of the TSX Venture Exchange, the Company paid finders' fees and expenses on portions of the Placement in the aggregate amount of $35,700 cash and issued 714,000 warrants, each such warrant entitling the holder to acquire one additional common share of the Company at a price of $0.10 for a period of eighteen months from the respective Closing of each tranche.

All securities issued in the Placement will be subject to a four-month hold period from the Closing of the Placement.

The Placement remains subject to the receipt of final acceptance from the TSX Venture Exchange.

The proceeds of the Placement will be used principally to fund future exploration programs on the Company's Urumalqui Project in Peru and for general working capital purposes.

Mr. Anthony F. Ciali, President & CEO, stated, "Given the difficult financial market conditions that have persisted for most of 2012, especially for junior mining companies, we are extremely pleased to have been able to finalize this Placement. Of particular note, over half of the Placement was subscribed to by new Peruvian investors."

About AndeanGold Ltd:

AndeanGold Ltd. is engaged in the acquisition, exploration and potential development of primarily precious metals properties, principally in Peru and Ecuador. The focus of the Company's exploration activities is presently in advancing its Urumalqui Project, as well as pursuing mineral property acquisitions, in Peru. In Ecuador, the Company's activities have been limited to administrative and legal matters due to the Mining Mandate issued by the Ecuador Constituent Assembly on April 18, 2008. In November 2009, President Correa signed the Mining Regulations into law pursuant to the requirements of the new Mines Law, which was passed in January 2009. This was the final legal precursor to the re-initiation of exploration and mining development in Ecuador. The Company has been issued new mining titles under the new Mines law to its three key Ecuadorian projects and has filed the requisite documents with the Ministry of Non-Renewable Natural Resources and Ministry of Environment in support of the Company's request to renew exploration programs on its key projects in Ecuador. The Company is actively working with government officials to achieve this end.

Please refer to AndeanGold's website at www.andeangoldltd.com for further information on the Company's projects and activities.

On Behalf of the Board of Directors of ANDEANGOLD LTD.

Anthony F. Ciali, President, CEO and Director

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contacts:

AndeanGold Ltd.

Tony Ciali

732.940.5487
tciali@andeangoldltd.com
www.andeangoldltd.com


Ascenta Capital Partners Inc.

Jim Glass

Investor Relations

604.684.4743 ext. 225 or Toll free: 1.866.684.4743 ext. 225
jim@ascentacapital.com