Farm-out of Guinean Gold Asset

20 January 2017

Sovereign Mines of Africa PLC

("SMA" or "the Company")

Farm-out of Guinean Gold Asset

Further to the announcement of 7 November 2016, Sovereign Mines of Africa PLC (AIM:SMA), is pleased to announce that it has completed the farm-out of its 75% interest in the Mandiana Gold Project in the Republic of Guinea, West Africa to Volcanic Metals Corp. ("Volcanic"). In connection with the farm-out Volcanic has changed its name to "Volcanic Gold Mines Inc." and now trades under its new name on the TSX Venture Exchange, under the symbol "VG".

In consideration for the farm-out the Company has received 2,502,489 common shares in Volcanic, as announced on 7 November 2016 it is the Company's intention to hold its interest in Volcanic for such time that maximises shareholder value.

Effect of the Farm-out

The farm-out of the Company's 75% interest in the Mandiana Gold Project constitutes a cessation of all of the Company's existing trading business pursuant to Rule 15 of the AIM Rules for Companies ("AIM Rules"). The Company is now classified as an AIM Rule 15 cash shell, pursuant to which it must make an acquisition or acquisitions which constitute a reverse takeover under AIM Rule 14 within six months, failing which the Exchange will suspend trading in the Company's shares pursuant to AIM Rule 40.

Enquiries:

SOVEREIGN MINES OF AFRICA PLC

Giles Clarke, Chairman - c/o Camarco +44 20 3757 6983

Rupert Street, CEO

SHORE CAPITAL - NOMINATED ADVISER & BROKER

Toby Gibbs - Corporate Finance +44 207 408 4090

Jerry Keen - Corporate Broking

CAMARCO

Billy Clegg / Gordon Poole +44 20 3757 6983

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.