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Rio Novo Gold Signs Agreement to Acquire Ball Mill for Almas Gold Project in Brazil

Rio Novo Gold Inc. (TSX:RN)(TSX:RN.WT) has announced that it has signed a purchase agreement with Anagold Madencilik A.S. to acquire a ball mill and several other processing equipment items for installation at its 100%-owned Almas Gold Project in Tocantins, Brazil.

The purchased equipment, which is now surplus the Vendor's own requirements, previously formed part of a gold processing plant, designed for the Vendor by SNC Lavalin Inc. The ball mill has a design throughput capacity of 2 million tonnes of ore per year, and was designed and manufactured by Metso Corporation. All of the equipment is new, unused, packed and crated, and is available for immediate delivery. Total consideration for the acquisition is US$3.8 million and includes technical information and a supplier/vendor documentation package. Closing of the acquisition is expected to take place on or about April 14, 2011.

The acquisition marks a major step for Rio Novo as the company continues to develop its Brazilian gold properties with the goal of being an active producer in 2012, while continuing to explore its two gold districts. The Plant represents the capital equipment item with the largest associated expenditure and longest lead time, and its procurement will both achieve significant cost savings and maintain the Almas Project's accelerated timeline.

CEO, David Beatty, states "We are delighted that our Rio Novo team was able to source this important, long lead time, equipment package. It comes at substantial Capex savings and keeps the Almas Gold Project on its accelerated timeline to initial production and cash flow in Q2 2012."

Source: Rio Novo Gold Inc.

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