ASX Announcement

30 October 2012

KULA GOLD LODGES MINING LEASE APPLICATION Directors David Frecker Independent Chairman and Non-Executive Director Lee Spencer Managing Director and CEO John Watkins

Executive Director and CFO

Louis Rozman

Non-Executive Director

Mark Stowell Independent Non- Executive Director

ASX Code: KGD

112.6 million ordinary shares

5.2 million unlisted options

Kula Gold Limited (Kula Gold or the Company) announces that it has formally lodged with the PNG Government the Mining Lease Application (MLA) in conjunction with the Feasibility Study and Development Proposal in respect of the Woodlark Island Gold Project (the Project).

The MLA was submitted to the PNG Minerals Resources Authority on 30

October 2012. This lodgement follows the Company's Feasibility Study, completed in September 2012, which demonstrated the robust

economics of the Project.

The Company has completed the various components of the Feasibility Study to a high standard over the past 2 years with its experienced team supported by highly skilled external consultants. We look forward to a favourable response to the Mining Lease Application and Development Proposal from the PNG Government.

Commenting, the Managing Director of Kula Gold, Lee Spencer, said: "This is another key milestone for Kula Gold and brings us closer to our goal of being the next gold producer in PNG."

"We have regular dialogue with PNG Government officials and continue to work closely with them to guide the Project through to the development phase."

"With the MLA now lodged, we can focus on pre-construction aspects of the project."

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Background: Woodlark Island Gold Project, PNG

Metres:

Kula Gold Limited is developing the 100% owned Woodlark Island Gold Project, located 600 kilometres east of Port Moresby in the Milne Bay Province, Papua New Guinea.

For further information, contact:

Lee Spencer John Watkins

Chief Executive Officer Chief Financial Officer Kula Gold Limited Kula Gold Limited lspencer@kulagold.com.au jwatkins@kulagold.com.au P. 02 9262 5651 P. 02 9262 5651

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Forward Looking Statements

All statements other than statements of historical fact included in this announcement including, without limitation, statements regarding future plans and objectives of Kula Gold Limited (Kula Gold) are forward-looking statements. When used in this announcement, forward-looking statements can be identified by words such as 'may', 'could',
'believes', 'estimates', 'targets', 'expects' or 'intends' and other similar words that involve risks and uncertainties.
These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this announcement, are expected to take place. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the
company, its directors and management of Kula Gold, that could cause Kula Gold's actual results to differ materially from the results expressed or anticipated in these statements.
The company cannot and does not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements. Kula Gold does not undertake to
update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this announcement, except where required by applicable law and stock exchange listing requirements.

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