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Publish Date : 06-Apr-2013

Northern Lion Gold Corp. (the \"Company\") announces that, further to its previously announced letter of intent with Centerra Gold Inc. (\"Centerra\") (reported February 28, 2013), it has entered into a binding definitive option agreement (the \"Agreement\") with Centerra Gold (KB) Inc., a subsidiary of Centerra. The Company also announces the initiation of a joint exploration program with Centerra in the Republic of Cyprus.

Pursuant to the Agreement, Centerra can earn a 51% to 70% interest in a number of the Company\'s exploration permits (the \"Option Properties\") located in the Larnaca and Paphos Districts of the Republic of Cyprus. To earn an initial 51% interest, Centerra must pay US$100,000 to the Company and make exploration and development expenditures of US$3 million over three years (the \"Initial Option Period\"). Once a 51% interest is earned by Centerra, either a 51/49 joint venture will be formed (and further funding would be done on a pro rata basis), or Centerra may elect to earn an additional 19% interest to bring its total property interest to 70% by funding an additional US$3 million in exploration and development expenditures within a two year period following its election to increase its interest.

The Company will be the operator during the first year of the Initial Option Period, following which Centerra may elect to assume operatorship.

Centerra\'s funding obligations under the Agreement are subject to certain conditions, including the Company obtaining TSX Venture Exchange approval and the receipt of certain licenses which have been applied for by the Company.

The Company and Centerra are preparing to commence a ground-based EM and magnetic geophysical survey (\"Geophysical Survey\") over prospective areas in the Paphos and Larnaca Districts.

Company President and CEO, John Lando, commented: \"This final agreement with Centerra represents a firm commitment from a leading gold producer to work with us to discover buried Cyprus-style massive sulphide deposits in underexplored regions of Cyprus. We have held numerous meetings with Centerra\'s technical team to outline high priority targets and to design an exploration program that includes ground geophysical surveys and diamond drill programs.\"

The geophysical survey is designed to follow-up on the results of a 2011 Versatile Time-Domain Electromagnetic Survey conducted by Geotech Airborne Malta, Ltd. (reported February 7, 2012), to explore for buried massive sulphide targets in underexplored areas of western Cyprus. Five high priority targets located in the Paphos District of western Cyprus have been selected by Centerra for follow-up., including the prospective Lysos permit. The Lysos permit area hosts a cluster of seven VTEM anomalies.

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