Goldgroup Announces Appointment of Gregg J. Sedun as Interim Chief Executive Officer

VANCOUVER, Oct. 12, 2012 /PRNewswire/ – Goldgroup Mining Inc. (“Goldgroup” or
the “Company”) (TSX: GGA) announced today that its Board of Directors
has appointed Executive Chairman, Gregg J. Sedun, to also fill the role of President and Interim Chief Executive Officer, replacing Mr. Keith Piggott.  Mr. Piggott is a
major shareholder of the Company and continues to serve on the
Company’s Board of Directors. This leadership appointment is effective
immediately.

Mr. Sedun stated, “On behalf of our Board, I would like to thank Mr.
Piggott for his significant contribution to Goldgroup’s development
over the last six years. The Board has determined that the Company’s focus going forward
remains in optimizing capital and other costs, in addition to
streamlining permitting and operational processes in order to ensure
production at our flagship project, Caballo Blanco, is completed on a
timely basis.”

The Board is taking steps to fill the CEO position in an expeditious
manner.  As interim CEO, Mr. Sedun will provide strong continuity in
the transition period and will supervise day-to-day operations of the
Company.

Mr. Sedun, LLB, has been Executive Chairman of Goldgroup from its
inception six ago years and has extensive knowledge of the Company’s
operations, in addition to 29 years of expertise in legal, corporate
finance, and executive management positions for publicly traded
resource companies.  Mr. Sedun has been involved as a director and/or
founding shareholder in a number of successful companies including as
founding director of Diamond Fields Resources Inc. which was acquired
by Inco for $4.3 billion.  He was also a founding director of Adastra
Minerals Inc. which was acquired by First Quantum Minerals Ltd. for
$275 million, and was part of the founding shareholder group of Peru
Copper Inc. which was acquired by Chinalco in an all-cash $840 million
takeover.

Mr. Sedun continued, “The Company has significant growth potential in
near-term production and exploration at Caballo Blanco, a management
team with proven mine development, operations and production
experience, and has significant financial flexibility. My focus will be
reviewing, in conjunction with the Board, our corporate strategies to
ensure cost-saving measures are implemented and permitting is executed,
with an emphasis on maximizing shareholder value.”

About Goldgroup

Goldgroup is a well-funded Canadian-based gold production, development,
and exploration Company with significant upside in a portfolio of
projects in Mexico, including its flagship 100%-owned advanced stage
gold development project Caballo Blanco in the state of Veracruz, and a
50% interest in DynaResource de Mexico, S.A. de C.V., which owns 100%
of the high-grade gold exploration project, San José de Gracia located
in the state of Sinaloa. The Company also operates its 100%-owned Cerro
Colorado gold mine in the state of Sonora.

Goldgroup remains in a flexible financial position with a strong cash
balance, no debt and no gold hedging. The Company is led by a team of
highly successful and seasoned individuals with extensive expertise in
mine development, corporate finance, and exploration in Mexico.
Goldgroup’s mission is to increase gold production, mineral resources,
profitability and cash flow, building a leading gold producer in
Mexico.

For further information on Goldgroup, please visit www.goldgroupmining.com

On behalf of the Board of Directors,

Gregg J. Sedun, Executive Chairman, President & Interim CEO

Tel: 604-345-6642

Stephanie Batory, Director of Investor Relations

Toll Free: 1-877-655-ozAu (6928)

CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION

Certain information contained in this news release, including any
information relating to future financial or operating performance, may
be considered “forward-looking information” (within the meaning of
applicable Canadian securities law) and “forward-looking statements”
(within the meaning of the United States Private Securities Litigation
Reform Act of 1995). These statements relate to analyses and other
information that are based on forecasts of future results, estimates of
amounts not yet determinable and assumptions of management. Actual
results could differ materially from the conclusions, forecasts and
projections contained in such forward-looking information. These
forward-looking statements reflect Goldgroup’s current internal
projections, expectations or beliefs and are based on information
currently available to Goldgroup. In some cases forward-looking
information can be identified by terminology such as “may”, “will”,
“should”, “expect”, “intend”, “plan”, “anticipate”, “believe”,
“estimate”, “projects”, “potential”, “scheduled”, “forecast”, “budget”
or the negative of those terms or other comparable terminology. Certain
assumptions have been made regarding the Company’s plans at the Caballo
Blanco project. Many of these assumptions are based on factors and
events that are not within the control of Goldgroup and there is no
assurance they will prove to be correct. Forward-looking information is
subject to a variety of known and unknown risks, uncertainties and
other factors that could cause actual events or results to materially
differ from those reflected in the forward-looking information, and are
developed based on assumptions about such risks, uncertainties and
other factors including, without limitation: uncertainties related to
actual capital costs, operating costs and expenditures, production
schedules and economic returns from Goldgroup’s projects; uncertainties
associated with development activities; uncertainties inherent in the
estimation of mineral resources and precious metal recoveries; risks
related to the continued operation of the Cerro Colorado mine without a
current economic analysis; risks related to the planned expansion of
the Cerro Colorado mine; uncertainties related to current global
economic conditions; fluctuations in precious and base metal prices;
uncertainties related to the availability of future financing;
potential difficulties with joint venture partners; risks that
Goldgroup’s title to its property could be challenged; political and
country risk; risks associated with Goldgroup being subject to
government regulation; risks associated with surface rights;
environmental risks; Goldgroup’s need to attract and retain qualified
personnel; risks associated with operating hazards at the Cerro
Colorado mine; risks associated with potential conflicts of interest;
Goldgroup’s lack of experience in overseeing the construction of a
mining project; risks related to the integration of businesses and
assets acquired by Goldgroup; uncertainties related to the
competitiveness of the mining industry; risk associated with theft;
risk of water shortages and risks associated with competition for
water; uninsured risks and inadequate insurance coverage; risks
associated with potential legal proceedings; risks associated with
community relations; outside contractor risks; risks related to
archaeological sites; foreign currency risks; risks associated with
security and human rights; and risks related to the need for
reclamation activities on Goldgroup’s properties, as well as the risk
factors disclosed in Goldgroup’s Annual Information Form and MD&A. Any
and all of the forward-looking information contained in this news
release is qualified by these cautionary statements. Although Goldgroup
believes that the forward-looking information contained in this news
release is based on reasonable assumptions, readers cannot be assured
that actual results will be consistent with such statements.
Accordingly, readers are cautioned against placing undue reliance on
forward-looking information. Goldgroup expressly disclaims any
intention or obligation to update or revise any forward-looking
information, whether as a result of new information, events or
otherwise, except as ay be required by, and in accordance with,
applicable securities laws.

SOURCE Goldgroup Mining Inc.