Patagonia Gold plc provided an operational update on the company's Lomada de Leiva ('Lomada') mine and exploration on El Tranquilo Property. The Lomada Mine is located approximately 40 kilometres south-east of the town of Perito Moreno in the Province of Santa Cruz, and is within the Group's La Paloma property block covering over 44 square kilometres. Lomada is on-track to achieve its expansion target of 3,000 ounces of gold per month production by the end of third quarter. All in cash costs including plant and mine fleet depreciation for August were $625 per ounce Au and are expected to reduce further with improving operational efficiencies.

For the first eight months of 2014 the Lomada Project sold a total of 16,088.43 ounces of gold for gross revenues of $20,837,508 at an average all in cash cost of $812 per ounce. Total ore mined from the commencement of the project is 736,600T at the rate of 2.10 g/t for 49,800 Oz contained gold.

Full year guidance production has been revised due to the extended delivery timeline of additional mining equipment impacting the planned expansion. The full year production target for 2014 is now set at approximately 27,000 ounces of gold. The second large excavator has been delivered and is now operational with mine production steadily increasing. Equipment availability is also increasing due to the company taking on all maintenance in house and removing costly third party providers from site.