Superior Gold Inc. (TSX-V: SGI) announces financial results for the second quarter of 2021 for the Company’s 100%-owned Plutonic Gold Operations, located in Western Australia.

Second Quarter Highlights

• Increased production by 28% over prior year period and 10% over the first quarter of 2021 to 19,356 ounces, with sales of 19,099 ounces
• Maintained strong mined stope grade of 3.3 g/t gold in the second quarter
• Commenced open pit mining at Plutonic East on schedule increasing surface feed grade
• Metallurgical recovery increased to 88% from 86% in the first quarter of 2021 as a result of higher head grades due to the contribution of Plutonic East open pit ore
• Realized a record average gold price of $1,801/ounce above All-In Sustaining Cost¹ (“AISC”) of $1,519/ounce
• Net income for the period of $0.01 per share and adjusted net income of $0.01 per share
• Generated cash flow from operations of $4.9 million after working capital changes prior to the repayment of the gold loan
• Early full repayment of the Auramet gold loan and exited the second quarter with zero term debt
• Strong financial position of $17.4 million in cash and cash equivalents
• Announced additional positive exploration results which included 14.8 g/t gold over 13.4 metres at the Baltic Gap Mining Front²
• Recorded zero incidences of COVID-19 infection for a sixth consecutive quarter

Chris Jordaan, President and CEO of Superior Gold stated: “We are very pleased to report our fourth quarter-over-quarter increase in production. The operational initiatives that we put in place last year are resulting in a steady improvement in our operating results, including a 21% increase in mined stope grade year-to-date compared to 2020. These operational improvements continue to drive our increasing cash flow from operations which has resulted in an increase of the Company’s working capital position to $4.8 million in the second quarter.

In addition, we have further advanced our geological understanding of the Plutonic orebody, including the northwest trending faults that control the location and concentration of higher-grade gold mineralization. This has led to a number of strategically significant exploration results, demonstrating that there are a number of new high-grade mining fronts potentially opening at Plutonic, as well as the identification of higher-grade stopes on the operational front. During the quarter, we provided an exploration update at the Baltic Gap Mining Front where we have expanded the known high-grade Plutonic mineralization as part of our strategy to identify new mining fronts to allow for improved mining grades and productivity and reduced reliance on remnant mining.

We also continue to advance other strategic projects necessary to reposition Plutonic for sustainable, long-term success. The restart of open pit mining at Plutonic East was completed on schedule. The displacement of low-grade stockpile with higher grade open pit feed, in conjunction with the opening of new underground mining fronts, is expected to continue to improve our grade profile and ability to generate operating cash flow over the remainder of 2021 and beyond.”

Summary of Financial and Operational Results:

Plutonic Gold Operations

The Plutonic Gold Operations produced and sold 19,356 and 19,099 ounces of gold, respectively, for the second quarter of 2021. Total cash costs¹ of $1,412/ounce sold and AISC¹ of $1,519/ounce sold were below the realized gold price¹ of $1,801/ounce for the three-month period ending June 30, 2021.

In comparison, 15,177 and 15,536 ounces of gold were produced and sold, respectively for the second quarter of 2020. Total cash costs¹ of $1,426/ounce sold and AISC¹ of $1,547/ounce sold were below the realized gold price¹ of $1,608/ounce for the three-month period ending June 30, 2020.

Total cash costs¹ and AISC¹ decreased over the prior period primarily as a result of a higher number of ounces of gold sold, partially offset by the strengthening of the Australian dollar relative to the U.S. dollar in comparison to the second quarter of 2020, which contributed $208/ounce and $215/ounce, respectively to the increase in total cash costs and AISC.

The Company generated net cash from operations after working capital changes of $4.9 million for the three months ending June 30, 2021, excluding the repayment of $2.2 million under the gold loan.

Exploration Activities

During the second quarter of 2021, the Company provided an exploration update at the Baltic Gap Mining Front containing important high-grade drill results from its underground drill program as part of its strategy to identify new mining fronts to allow for improved mining grades and productivity and reduced reliance on remnant mining.

The latest drilling results show continued growth of the new Baltic Gap Mining Front, which now extends over an interpreted strike length of 350 metres and up to 200 metres down dip, while remaining open along strike and at depth. Results such as drill hole UDD24342, which intersected 14.8 g/t gold over 13.4 metres, gives the Company further confidence in mining higher grades at Plutonic in the future¹.

The Baltic Gap Mining Front extends approximately 700 metres along the northern edge of the Baltic zone of the Plutonic orebody and remains open, with several historic high-grade intercepts indicating continuity of mineralization outside of the current Mineral Resource envelope.

2021 Guidance

The Company continues to maintain its 2021 guidance which was previously announced on January 21, 2021. Details of production, cost and capital expenditure guidance for the year are summarized in the table below.

Qualified Person

Scientific and technical information in this news release has been reviewed and approved by Keith Boyle, P.Eng., Chief Operating Officer of the Company, who is a “qualified person” as defined by NI 43-101. Mr. Boyle is not independent of the Company within the meaning of NI 43-101.

About Superior Gold

Superior Gold is a Canadian based gold producer that owns 100% of the Plutonic Gold Operations located in Western Australia. The Plutonic Gold Operations include the Plutonic underground gold mine and central mill, numerous open pit projects including the Plutonic Main Pit push-back project, the Hermes open pit projects and an interest in the Bryah Basin joint venture. Superior Gold is focused on expanding production at the Plutonic Gold Operations and building an intermediate gold producer with superior returns for shareholders.