18 May 2015 - Highland Gold Mining Limited ("Highland Gold", or the "Company" AIM: HGM) is pleased to announce Russian-compliant reserves (C1+C2 category) of 62.1 tonnes (1.99 million oz) of gold at its Kekura project after receiving approval from the State Committee on Reserves (GKZ). The ruling represents significant progress in mine development, facilitating the drafting of detailed project design according to Russian mining regulations.

A GKZ expert panel approved an updated TEO study inclusive of a C1+C2 category reserve calculation, which the Company submitted for review at the beginning of this year. At a cut-off grade of 1.0 g/t, open-pit mineable C1+C2 reserves at Kekura amount to 45.6 tonnes (1.47 million oz) of gold with an average ore grade of 9.12 g/t, while C1+C2 reserves destined for underground mining are 16.5 tonnes (0.53 million oz) of gold at an average ore grade of 12.26 g/t and a cut-off grade of 2.0 g/t. The Company expects to receive official documentation on reserve registration in the coming weeks.

Kekura is the Company's flagship development project, located in the Chukotka region in Russia's Far East. Substantial exploration work and technical studies have already been completed at the site to date, with a view towards beginning production in 2018. An updated independent JORC-compliant resource/reserve estimation by an international consultancy is currently underway, and final results are expected in Q3 2015.

Mr. Werner Klemens, Head of Exploration at Highland Gold has reviewed and verified the information contained in this release with respect to drilling and resource / reserve matters. Mr. Klemens holds a Ph.D. in Geology from the University of Toronto has more than 16 years of experience in mineral exploration and is a fellow of the Geological Association of Canada. A rigorous quality assurance programme complying with international standards is in effect at all exploration projects and includes duplicate sampling, insertion of standards and check assaying at external laboratories.

For further information please contact:

Glossary:

Russian Standard
Gosstandart of Russia (GOST), the national Russian standard on mining and minerals as published by the National Certification Body of the Russian Federation.

Category C1
Russian reserve category generally consistent with the Indicated resource category of the JORC code.

Category C2
Russian reserve category partly consistent with the Indicated and partly with the Inferred resource category of the JORC code.

JORC
Widely accepted standard for reporting mineral resources and ore reserves established by the Australasian Joint Ore Reserves Committee.

Cut-Off Grade
A grade level below which the material is considered to be uneconomical to mine and process. The minimum grade of ore used to establish reserves.

TEO
Technical and economic justification of exploration conditions.