KSK Copper Project Achieves Significant Milestone

Kalimantan Gold Corporation (KLG) is pleased to provide an update on the
exploration program at the KSK Copper Project in Kalimantan, Indonesia,
that is being sole funded by Surya Kencana LLC (SK LLC), a subsidiary of
Freeport-McMoRan Exploration Corporation.

Highlights:

• Surya Kencana LLC elects to continue to sole fund exploration and
  feasibility
• 5,418m of drilling currently completed with an additional 2,373m in
  progress. Results include:

- BK031-01: 28.9m @ 0.61% Cu, 0.06g/t Au, 1.27 g/t Ag from 16m

- BK032-01: 60.6m @ 0.74% Cu, 0.02g/t Au, 0.67g/t Ag from 14.8m

• 675 Rock Chip and 730 soil samples collected

Sole Funding Election by SK LLC

Having completed sole funding exploration to $7,000,000, SK LLC has
notified KLG that SK LLC has elected to continue to sole fund all
remaining exploration and feasibility study expenditure under the
Earn-In Agreement, subject to SK LLC′s right to withdraw from the Joint
Venture in accordance with the terms of the Agreement. 'We have reached
an historic milestone in the life of this project now that SK LLC has
exercised its option to continue sole funding during the Feasibility
Study period,' said Faldi Ismail, CEO of KLG.

Drilling Program Update

Two Duralite drill rigs have been utilized on the deep porphyry copper
program and two smaller Jackro rigs have been assigned to the Beruang
Kanan near-surface delineation drilling program. Two deep and six
delineation holes have been completed and a further two deep holes
(BTD06-01 and BKD02-02) are nearing completion. Drill hole statistics
are presented below.

KSK Drilling Statistics:

Beruang Tengah Deep Holes

Assays received from BTD05-02 at the Beruang Tengah Prospect show an
even distribution of weak copper-gold mineralization from surface to
986m depth, with an average grade of 739 ppm Cu and 0.09 g/t Au -. The
ratio of Au:Cu is also very consistent at around 1:1. This result, while
not returning economic grades, does suggest that a porphyry system is
present. The second (BKT06 -01) of at least 4 holes planned at the
prospect is located 400 meters south of BKT05-02 and currently at a
depth of 1200m. The hole comprises variably stockwork veined, medium to
fine grained diorite and medium to coarse grained equigranular
granodiorite with overprinting phyllic alteration. The veins are
comprised of quartz-sericite-pyrite+/- chalcopyrite+/- molybdenite All
subsequent drill holes at Beruang Tengah will be directed at locating
the potential high grade portions of this porphyry system.

Beruang Kanan Deep Holes

The first drill hole (BKD01-01) within the main zone at Beruang Kanan
did not produce any significant intercepts, although several small zones
with minor copper mineralization were encountered. A second drill hole,
BKD02-02 in the southern part of Beruang Kanan, is currently at 1200m. A
third planned deep drill hole at Beruang Kanan (BKD03-01) will test the
central zone where the delineation drilling is currently underway.

Drill location of the two Duralite drill rigs at KSK Copper Project:

To view the graphic KLG1, please click on the following link:

http://www.fscwire.com/pr/KLG1.jpg

Beruang Kanan Shallow Delineation Drilling

The operation of the two shallow-level drill rigs continued on the
central mineralized zone of Beruang Kanan. Seven holes have been
completed and a further two are in progress (BK037 and BK038).

This drilling continues to test the strong silica clay pyrite altered
volcanic breccia that contains chalcopyrite and covellite mineralization
in strongly sheared and silica flooded zones with irregular white quartz
veining. Assays have been returned from holes BK029-01, BK030-01,
BK031-01 and BK032-01 and are reported in the table below:

Table of significant intercepts from Beruang Kanan definition
drilling*:

*Low level analysis of gold in rocks and soils by 50 g fire assay
fusion, AAS finish. Determination of base metals by Triple Acid digest,
ICP-OES finish.

Delineation Drill Hole locations at Beruang Kanan Prospect:

To view the graphic KLG2, please click on the following link:

http://www.fscwire.com/pr/KLG2.jpg

Field Geology Programs

As part of a campaign to investigate all areas of interest in a
systematic manner, field geology programs have been initiated at Focus 1
and Rinjen and extended at Beruang Kanan and Beruang Tengah. The
programs included follow-up sampling, grid soil sampling, and geological
mapping. The fieldwork in southern Beruang Tengah was done to close the
mapping of the diorite intrusion to the south and also to extend the
soil sampling grid in an effort to close the copper and
molybdenum-in-soil anomaly to the SW.

Field geology programs have been completed or are ongoing at Beruang
Tengah, Beruang Kanan, Low Zone, Focus 1, Ketambung and Rinjen and
include follow-up sampling, grid soil sampling, and geological mapping.
This activity is part of a campaign to investigate all areas of interest
in a systematic manner to generate data to support defining additional
drill holes targeting these prospects.

Map showing current exploration prospects:

To view the graphic KLG3, please click on the following link:

http://www.fscwire.com/pr/KLG3.jpg

These programs have produced a total of 730 soil and 675 rock samples.

Future detailed exploration activities will include geology, structure
and alteration mapping, geochemistry and potentially geophysical surveys
at these prospects plus the Mamuring, and Volcano prospects.

Additional Forestry Permits

The process of applying for additional ground under the Forestry Borrow
to Use system (Pinjam Pakai) has been initiated to allow access to other
priority areas within the KSK Contract of Work including Tumbang Huoi,
Baroi and Mansur prospects.

Lab Facility for Preparation of Samples

The core sampling facility and sample prep lab commenced operation in
early July and has processed around 1257 rock chip and soil samples and
2014 drill core samples to date.

Assays were carried out in Jakarta by PT Intertek (ISO certified) with
sample checks by PT Geoassy. Both labs include routine Canadian
Certified Reference Materials (CCRM), in-house standards and blank
samples are inserted with each sample submission. Low level analysis of
gold in rocks and soils was carried out by 50g fire assay fusion with
AAS finish, and base metals were determined by triple acid digestion and
ICP-OES finish.

Corporate Social Responsibility (CSR) Program

Yayasan Tambuhak Sinta (YTS) is working in 21 Dayak villages, located
along the Kahayan River, just outside of the KSK concession area. YTS′s
program is focused on strengthening governance in the area, and is
helping communities take greater responsibility for their own
development agenda through participatory planning, institution
strengthening and economic development.

This initiative enables communities to engage more effectively with
local government in order to access improved services and programs in
education, health, infrastructure and economic livelihoods.

YTS provides training and technical assistance to improve the
capabilities of villagers in growing crops, raising animals, and
managing local resources. In 2012, this support concentrated on
vegetables, fish, pigs and rubber.

In collaboration with the local credit union, YTS provided training on
savings, credit, and small business development. By joining the credit
union, people establish savings accounts and can access credit for their
household or business.

At district level, YTS has a two-year program to improve the capacity of
district staff to improve their annual planning and budgeting mechanism.
This will result in delivering better support programs and services to
communities.

The YTS Community Development Program accounted for 4% of expenditure
and includes:

a. Village Development Planning

b. Village Development Fund & Technical Support for Economic Livelihoods

c. Village Institutional Development

d. Kalimantan Kids Club ? a scholarship program

e. Information & Communication Media and Events

All data, as disclosed in this press release, has been reviewed and
verified by the Company's Qualified Person for the KSK Project, Dr.
Peter Pollard, who is a Member of the Australasian Institute of Mining
and Metallurgy (Chartered Professional).Dr Pollard acts as a
technical consultant to KLG and has sufficient experience which is
relevant to the style of mineralization and type of deposit under
consideration and to the activity he is undertaking to qualify as a
Competent Person under the JORC Code.

-Ends-

About Kalimantan Gold

Kalimantan Gold Corporation Limited is a junior exploration company
listed on both the TSX Venture Exchange in Canada and on AIM in London.
The Company has two exploration projects in Kalimantan: the Jelai
epithermal gold project in East Kalimantan and the KSK Contract of Work
in Central Kalimantan with potential for multiple porphyry copper and
gold prospects. For further information please visit www.kalimantan.com

To view the graphic KLG4, please click on the following link:

http://www.fscwire.com/pr/KLG4.jpg

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.

This news release contains forward-looking statements that are based
on the Company′s current expectations and estimates. Forward-looking
statements are frequently characterized by words such as 'plan?,
'expect?, 'project?, 'intend?, 'believe?, 'anticipate?, 'estimate?,
'suggest?, 'indicate? and other similar words or statements that certain
events or conditions 'may? or 'will? occur. Such forward-looking
statements involve known and unknown risks, uncertainties and other
factors that could cause actual events or results to differ materially
from estimated or anticipated events or results implied or expressed in
such forward-looking statements.Such factors include, among
others: the actual results of current exploration activities;
conclusions of economic evaluations; changes in project parameters as
plans continue to be refined; possible variations in ore grade or
recovery rates; accidents, labour disputes and other risks of the mining
industry; delays in obtaining governmental approvals or financing; and
fluctuations in metal prices.There may be other factors that
cause actions, events or results not to be as anticipated, estimated or
intended.Any forward-looking statement speaks only as of the
date on which it is made and, except as may be required by applicable
securities laws, the Company disclaims any intent or obligation to
update any forward-looking statement, whether as a result of new
information, future events or results or otherwise. Forward-looking
statements are not guarantees of future performance and accordingly
undue reliance should not be put on such statements due to the inherent
uncertaint

Kalimantan Gold Corporation

Faldi Ismail, Deputy Chairman
and CEO

Mobile: +61 (0) 423 206 324

Email: faldi.ismail@kalimantan.com

Gerald
Cheyne, Corporate Development (UK)

Telephone: +44 (0)
2077311806

Mobile: +44 (0) 7717473168

Email: gerald.cheyne@kalimantan.com

or

VSA
Capital Limited

Nick Redfern/ Peter Damouni

Telephone: +44
20 3005 5005/ +44 20 3005 5007

Email: ?pdamouni@vsacapital.com

or

KLG's
Nominated Adviser

RFC Ambrian Limited

Stuart Laing

Telephone:
+61 8 9480 2506

Email: stuart.laing@rfcambrian.com