Luna Gold Announces Exercise of Over-Allotment Option

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 13, 2011) -

NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

Luna Gold Corp. (TSX VENTURE:LGC)(BVLAC:LGC) ("Luna Gold" or the "Company") is pleased to announce that in connection with its previously closed marketed public offering (the "Offering") of units (the "Units"), the agents have exercised the over-allotment option to acquire an additional 5,028,152 Units at C$0.52 per Unit, and 250,000 warrants at C$0.06 per warrant for total gross proceeds of $2,629,639. This brings the total proceeds raised to $41,979,295 from both the Offering and the South American private placement.

The Offering was led by National Bank Financial Inc., and included Raymond James Ltd., BMO Capital Markets, and Scotia Capital Inc. (the "Agents"). Each Unit consists of one common share of the Company plus one half of one common share purchase warrant (each whole warrant, a "Warrant"), with each Warrant being exercisable to acquire one common share at a price of C$0.70 for a period of 24 months from the closing of the Offering.

Luna Gold intends to use the net proceeds of the Offering and the South American private placement for the Aurizona expansion scoping study, Aurizona resource definition expansion, Maranhão Greenfields discovery exploration, Cachoeira social impact study, corporate development, debt reduction and for general corporate purposes.

About Luna Gold Corp.

Luna Gold is a producing gold company with development and exploration projects. Gold production is from the Aurizona Mine in Maranhão, Brazil, and development is focused on the Cachoeira deposit in Para, Brazil. The Company is exploring Maranhão Greenfields, a large strategically placed land position in Maranhão, 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

All statements other than statements of historical fact included in this news release are forward-looking information that involve various risks and uncertainties including, without limitation, statements regarding the proposed use of proceeds. These statements are identified through the words "intend", "plan" and "expected" (or derivations thereof) in this news release. Such forward-looking information represents management's best judgment based on information currently available. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's plans or expectations include risks detailed from time to time in the filings made by the Company with Canadian securities regulators. These factors include the inherent risks involved in equity finance activities and the capital markets as a result of frequent and significant shifts in commodity prices and uncertainties in the global economy, 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 exploration and operations, fluctuating metal prices, 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, currency fluctuations, regulatory restrictions, including environmental regulatory restrictions and liability, competition, loss of key employees, and other related risks and uncertainties. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements or information whether as a result of new information, future events or otherwise, except as otherwise required by applicable securities legislation.