Luna Gold Corp. Announces Sale of the Cachoeira Project for Approximately $12 Million

Luna Gold Corp. (TSX VENTURE:LGC)(OTCQX:LGCUF)(LMA:LGC) ("Luna Gold" or the
"Company") is pleased to announce that it has entered into a share purchase
agreement (the "Share Purchase Agreement") with Brazil Resources Inc. ("BRI"),
to sell Luna Gold's wholly-owned subsidiary, Luna Gold (International) Corp.
("Luna BVI") which indirectly owns 100% of the Cachoeira Project, for
consideration of $11,998,400 to be satisfied by the issuance of cash and shares
of BRI (the "Transaction"). See "The Transaction" for details. 


The Company's decision to sell the Cachoeira Project is aligned with the
Company's strategy to focus its resources on gold production from the Aurizona
Mine and exploration of the Luna Greenfields. 


John Blake, President and CEO noted: "Luna Gold has demonstrated over the last
year our focus on increasing gold production, increased resource ounces in the
Aurizona brownfields area and high potential to unlock more ounces from Luna
Greenfields. Luna Gold is on target to produce 60,000 ounces of gold from
Aurizona in 2012 and increasing production to 100,000 ounces in 2013. 


As the next phase in improving the performance of Luna Gold we have reached
agreement with Brazil Resources Inc. on the sale of the Cachoeira project. Luna
Gold has achieved two outcomes in this sale; firstly Luna Gold can allocate all
management effort to focus increasing resource ounces and gold production and
secondly, Luna Gold as a shareholder in BRI will benefit from BRI's focus on
advancing Cachoeira into gold production."


The Agreement

Subject to the terms of the Share Purchase Agreement, immediately upon closing
of the Transaction, BRI will acquire 100% of the issued and outstanding shares
of Luna BVI, which holds an indirect 100% interest in the Cachoeira Project
through its subsidiaries. The consideration payable by BRI to Luna Gold under
the Agreement will consist of:




i.   $500,000 cash and 1,428,000 common shares of BRI ("BRI Shares") upon
     closing of the transaction;
ii.  $300,000 cash and 1,214,000 BRI Shares within 12 months of closing the
     transaction; 
iii. $300,000 cash and 1,214,000 BRI Shares within 30 days of receipt of
     approval of a mine development plan by the National Department of
     Mineral Production (Brazil) (DNPM) and the environmental preliminary
     licences for a gold mining operation relating to the Cachoeira 
     Project; 
iv.  $2,500,000, payable in cash or BRI Shares, at BRI's sole discretion,
     upon commencing mine construction at the Cachoeira Project, consisting
     of completion of $500,000 of expenditures towards such construction; 
     and
v.   $3,000,000 payable in cash or BRI Shares, at BRI's sole discretion, 
     one year after achieving commercial production at the Cachoeira 
     Project.



Notwithstanding the foregoing milestones, all of the payments from BRI to Luna
Gold will become due and payable four years after the closing date of the
Transaction. Any discretionary share-based payments will be valued based on the
volume weighted average trading price of the BRI Shares for the 10 days prior to
such payment. BRI's payment obligations will be evidenced by a promissory note
issued by BRI to Luna Gold, containing customary events of default and
acceleration provisions, and will be secured by security interests granted by
BRI and its subsidiaries to Luna Gold against, among other things, interests in
the Cachoeira Project and the shares of the subsidiaries to be sold under the
Agreement.


Completion of the Transaction is conditional upon, among other things, customary
closing conditions and the receipt of all required consents and approvals,
including the approval of the TSX Venture Exchange and completion of an updated
National Instrument 43-101 ("NI 43-101") compliant technical report by BRI.


The Property

The Cachoeira Project is located in the state of Para in northeastern Brazil and
consists of a contiguous block of two mine licenses and three exploration
licenses totalling 4,742 hectares. The Cachoeira Project contains an NI 43-101
compliant resource estimate containing an Indicated Mineral Resource of 12.5 Mt
@ 1.11 g/t Au containing 446,000 oz Au and an Inferred Mineral Resource of 5.4
Mt @ 1.27 g/t Au containing 221,300 oz Au.


About Luna Gold Corp.

Luna is a gold production and exploration company engaged in the operation,
exploration and development of gold deposits and advanced stage gold exploration
projects in Brazil. 


On behalf of the Board of Directors

LUNA GOLD CORP. 

John Blake - President and CEO

Regulatory Footnotes

This news release does not constitute an offer to sell or a solicitation of an
offer to sell any of the securities in the United States. The securities have
not been and will not be registered under the United States Securities Act of
1933, as amended or any state securities laws and may not be offered or sold
within the United States or to U.S. persons unless registered under the United
States Securities Act of 1933 and applicable state securities laws or an
exemption from such registration is available.


Forward-Looking Statements

This release contains certain "forward looking statements" and certain "forward
looking information" as defined under applicable Canadian and U.S. securities
laws. Forward-looking statements can generally be identified by the use of
forward-looking terminology such as "may", "will", "expect", "intend",
"estimate", "anticipate", "believe", "continue", "plans" or similar terminology.
Forward-looking statements include, but are not limited to, statements with
respect to future gold production and/or the results of analysis on gold
production. Forward-looking statements are based on forecasts of future results,
estimates of amounts not yet determinable and assumptions that while believed by
management to be reasonable, are inherently subject to significant business,
economic and competitive uncertainties and contingencies. Forward-looking
statements are subject to various risks and uncertainties concerning the
specific factors identified in Luna Gold Corp.'s periodic filings with Canadian
Securities Regulators. These factors include the inherent risks involved in the
exploration and development of mineral properties, the uncertainties involved in
interpreting drill results and other exploration data, the potential for delays
in exploration or development activities, the geology, grade and continuity of
mineral deposits, the possibility that future exploration, development or mining
results will not be consistent with the Company's expectations, accidents,
equipment breakdowns, title matters, labor disputes or other unanticipated
difficulties with or interruptions in production and operations, fluctuating
metal prices, unanticipated costs and expenses, uncertainties relating to the
availability and costs of financing needed in the future, the inherent
uncertainty of production and cost estimates and the potential for unexpected
costs and expenses, commodity price fluctuations, currency fluctuations,
regulatory restrictions, including environmental regulatory restrictions and
liability, competition, loss of key employees, and other related risks and
uncertainties. The Company undertakes no obligation to update forward-looking
information except as required by applicable law. Such forward-looking
information represents management's best judgment based on information currently
available. No forward-looking statement can be guaranteed and actual future
results may vary materially. Accordingly, readers are advised not to place undue
reliance on forward-looking statements or information.