Mr. Sam Coetzer reports

GOLDEN STAR'S PEA OF WASSA MINE INDICATES NPV OF $350 M

Golden Star Resources Ltd. is releasing the results of its preliminary economic assessment on the development of an underground mining operation at its Wassa mine in Ghana.

It is the company's objective to develop an underground mine at Wassa that will operate in conjunction with the existing open pit mine. A mineral resource estimate for Wassa, on which this PEA was based, was recently updated, and results are detailed below. Mineral resource estimates are reported inclusive of mineral reserves.

Additional debt financing to develop the Wassa underground mine, as announced last week, supplements cash and an existing facility to finance this project.

All references to dollars in this news release are to United States dollars.

Highlights:

• Assuming an open pit and underground mining scenario, total measured and indicated mineral resources at Wassa of 35.7 million tonnes at 2.22 grams per tonne gold for 2.5 million ounces;
• Substantial increase in inferred mineral resources at Wassa Main to nine million tonnes at an average grade of 3.88 grams per tonne for 1.1 million ounces;
• Internal rate of return of 129 per cent estimated for Wassa mine, at $1,300-per-ounce-gold price;
• Net present value at 5 per cent of $350-million estimated for Wassa mine, at $1,300-per-ounce-gold price;
• Preproduction incremental capital expenditure for Wassa underground estimated at $41-million;
• First production from Wassa underground expected early 2016, estimated mine life of 10 years thereafter for combined operation;
• Cash operating cost of $684 per ounce for combined Wassa operations estimated;
• All-in sustaining costs of $778 per ounce for combined Wassa operations estimated;
• Project financed with $25-million Ecobank Ghana financing facility recently arranged;
• Board decision taken to progress to feasibility study and commence construction of exploration decline early 2015.

Golden Star will be giving a presentation at the Denver Gold Show on Wednesday, Sept. 17, 2014, to discuss these results. Details of the presentation and webcast thereof are provided at the end of this release.

Sam Coetzer, president and chief executive officer of Golden Star, commented:

"The exceptionally strong results of this PEA on the Wassa mine demonstrate that we have made good progress in the execution of our strategy to transform Golden Star into a lower-cost producer. Furthermore, our confidence in these results is evident in our decision to commence the construction of a decline at Wassa in early 2015. I am convinced that we are now well on our way to deliver significantly enhanced value to our shareholders."

Introduction

The Wassa gold mine is in the western region of Ghana. It has a carbon-in-leach processing plant with a rated capacity of 2.7 million tonnes per annum. Golden Star has been mining the Wassa open pits since commissioning the plant in 2005. Mining is currently at the Wassa Main pit, which is within 500 metres of the plant.

Drilling below the Wassa Main pit has been continuing since late 2011. This drilling has been successful in increasing the Wassa mineral reserves by 148 per cent.

In early 2014, SRK Consulting (U.K.) Ltd. was awarded the contract to prepare a preliminary economic assessment to determine the economic viability of an underground mine beneath the Wassa Main pit. An underground mine is envisioned in the PEA that will operate in conjunction with the existing open pit mine for five years. Thereafter mining from the open pit will cease and mining will be solely from the underground mine for the remaining six years of operation.

The PEA assumes the use of mining contractors in the underground mine and owner-operated mining in the open pit. A gold price of $1,300 per ounce was used in the economic modelling, as well as the base case for the pit and underground optimizations.

The PEA is preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the conclusions reached in the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Mineral resource estimate

The PEA is based on an updated mineral resource model that has incorporated all of the recent drilling including infill at depth as well as step out to the south of the Wassa Main pit. The updated resource statement for the open pit has been constrained by a $1,400-per-ounce-optimized Whittle pit shell that was limited to the 820-metre elevation and is approximately 150 metres below the current mining benches. The underground mineral resources include material below this pit at an economic cut-off grade of 2.27 grams per tonne gold.

The updated measured and indicated mineral resources are slightly less than those reported at 2013 year-end due to seven months of mining depletion and a change of approach from an open pit method to combined open pit and underground mining. However, the inferred mineral resources have added approximately one million ounces of material below the open pit.

The updated PEA mineral resource has been estimated by SRK Consulting (Canada) Ltd. and reviewed by the company's technical personnel in accordance with guidelines set out in the definition standards for mineral resources and mineral reserves published by the Canadian Institute of Mining, Metallurgy and Petroleum and as required by Canada's National Instrument 43-101.

                                Wassa Main                        Wassa Main
                    mineral resource as of            mineral resource as of
                            Sept. 15, 2014                     Dec. 31, 2013

                                                                    Open pit

               Tonnes      Grade     Ounces     Tonnes      Grade     Ounces
Class           (000)     g/t Au      (000)      (000)     g/t Au      (000)

Measured            -          -          -        270       1.44         13
Indicated      25,582       1.41      1,160     44,812       1.78      2,568
M + I          25,582       1.41      1,160     45,082       1.78      2,580
Inferred          237       1.56         12        313       1.28         13

                                                                 Underground

Measured            -          -          -          -          -          -
Indicated      10,116       4.27      1,389      2,446       3.67        289
M + I          10,116       4.27      1,389      2,446       3.67        289
Inferred        8,841       3.95      1,122        646       3.10         64

                                                                    Combined

M + I          35,699       2.22      2,550     47,529       1.88      2,869
Inferred        9,077       3.88      1,134        959       2.51         77

Notes to the measured, indicated and inferred mineral resources:

1. The mineral resources are inclusive of mineral reserves.
2. The mineral resources were estimated in accordance with the definitions and requirements of Canada's National Instrument 43-101.
3. The 2013 year-end open pit mineral resources were estimated using optimized pit shells at a gold price of $1,400 per ounce inclusive of the mineral reserves as at Dec. 31, 2013.
4. The 2013 year-end open pit mineral resources are reported above an economic cut-off grade of 0.63 gram per tonne gold and 0.68 gram per tonne gold for oxide and fresh material, respectively, and 2.63 grams per tonne gold for underground material below the pit shell.
5. The PEA open pit mineral resources are reported between the July, 2014, month-end surveyed mining surface and an optimized pit shell using a gold price of $1,400 per ounce and limited to a lower elevation of 820 metres.
6. The PEA open pit mineral resources are reported above an economic cut-off grade of 0.58 g/t Au and 0.61 g/t Au for oxide and fresh material, respectively, and 2.27 g/t Au for underground material below the pit shell.
7. The qualified person reviewing and validating the estimation of the mineral resources is Mitchel Wasel, Golden Star Resources' vice-president of exploration.
8. Numbers may not add due to rounding.

The success of the step-out drilling has demonstrated the high-grade shoots are structurally controlled and related to earlier folding. The results of the two step-out drill hole fences, which were included in the PEA resource model update, have resulted in the approximate million-ounce increase in the inferred mineral resource. The last fence drilling on Section 19100 north intersected significant wide zones of high-grade gold mineralization, which confirms the mineralization is open to the south of the current model limits. The addition of a million ounces of inferred mineral resource from two drill fences testing the down-plunge extensions of the gold 400 metres to the south justifies the need for further step-out drilling. The company has planned another 200-metre step-out drill fence to the south of the last deep drilling on 19100 north and will commence drilling in the later part of 2014.

Wassa PEA findings

Capital expenditure

A summary of the capital costs and timing thereof from the PEA is tabulated.

                      2015-2016                                             
                    underground                                             
                  preproduction      2017-2021      2022-2026            LOM
Capital costs         (million)      (million)      (million)      (million)

Underground mine $           41   $         84   $         19   $        144
Infrastructure   $           25   $         11   $          0   $         36
Environmental    $            4   $          6   $          3   $         13
Total            $           70   $        101   $         22   $        193

Preproduction incremental capital costs for the underground mine are estimated to total $41-million, including $8-million in contingency capital. The bulk of this expenditure is the $24-million in underground development, which includes the development of an underground decline to about 300-metre vertical depth and four levels of lateral development designed to open up multiple working faces and allow flexibility within the mine plan.

Minor modifications to the Wassa processing plant are estimated to cost $2-million. A substantial portion of the budgeted infrastructure capital will be spent on a new tailings storage facility, which was already planned for the open pit mine.

      ECONOMIC SUMMARY AND SENSITIVITY TO GOLD PRICE AND DISCOUNT RATE

Posttax                                 NPV 5%          NPV 10%          IRR

Gold price         $    1,000        $     111        $      67          25%
                   $    1,100        $     191        $     136          47%
                   $    1,200        $     271        $     203          78%
                   $    1,300        $     350        $     269         129%
                   $    1,400        $     433        $     338         234%
                   $    1,500        $     515        $     407         615%
                   $    1,600        $     597        $     476          n/a

Operating metrics

A summary of the production and operating metrics for the combined open pit and underground mines and resulting operating costs from the PEA is tabulated.

PEA baseline metrics                                2017-2021      2022-2026 

Average pit run of mine (tpd)                           6,000              - 
Average underground ROM (tpd)                           1,700          2,700 
Daily tonnes processed                                  7,600          3,000 
Average mill feed grade (g/t Au)                         2.20           3.97 
Average gold recoveries                                   93%            93%
Average annual gold production (k oz)                     174            120 
                                                                            
                       2017-     2017-     2022-     2022-                  
                        2021      2021      2026      2026      LOM      LOM
Cost summary          ($/oz)     ($/t)    ($/oz)     ($/t)   ($/oz)    ($/t)

Cash operating cost $    798   $    51   $   586   $    69   $  684   $   56
All-in sustaining                                                           
cost                $    891   $    57   $   684   $    80   $  778   $   64
Total cost          $  1,022   $    64   $   736   $    86   $  863   $   71

1. Sustaining costs include royalties and sustaining capital but do not
include corporate general and administrative.  

Mining

Golden Star has been mining the Wassa open pits since 2005. Prior to 2013, mining was in a number of smaller satellite pits, which were combined into a single large Wassa Main pit in late 2013. This allowed for operational efficiencies and cost savings.

A decision has been taken by the board to commence a feasibility study and the construction of a development decline from the bottom of the Wassa Main pit in early 2015. A production decision will be based on obtaining the necessary permits and environmental approvals.

The decline will be positioned to follow the plunge of the underground target about 60 metres in the footwall. Close to the start of the decline a ventilation raise bore will be driven to provide an exhaust airway for the first phase of underground mining. As the decline is driven down, sublevels will be developed at a vertical spacing of 25 metres. These sublevels will allow access to the mineralized target for long-hole open stope mining. The minable resource varies in width from 15 metres to 70 metres. Wider areas will be mined using transverse methods, while narrower areas will be mined longitudinally. The mining sequence will be bottom-up primary-secondary stoping, and stopes will be filled with cemented waste backfill. The mine will be operated by a contractor using a full suite of mechanized equipment.

First production is expected from the underground mine in early 2016.

Assuming that development and ultimately mining of the Wassa underground proceeds, the underground material will receive priority in the processing plant due to the higher grade compared with the open pit material. As the underground ramps up in production over the first three years, the pit mining will slow down to maintain a steady feed to the processing plant.

The cut-off grades used for the open pit minable resource estimate are 0.70 gram per tonne and 0.73 gram per tonne for oxide and fresh, respectively. The underground minable resource cut-off is 3.0 grams per tonne.

The underground mine design assumes a total internal and external dilution of 28 per cent and a mining recovery of 95 per cent.

Mineral processing

The Wassa processing plant was constructed in 2005 and is currently operating at its rated capacity of 2.7 million tonnes per annum. The plant is 500 metres from the current open pit mining operations. Processing currently includes three-stage crushing, grinding, gravity recovery, carbon-in-leach circuits and a thickener. A final recovery circuit using electrowinning is also in place, along with associated secure gold room facilities. Average recoveries since mining has been in fresh rock have been 93 per cent, and future recoveries from combined open pit and underground operations are estimated to be at this level.

Near-term development plans and continuing exploration

Although no development decision has been reached for the Wassa underground mine, Golden Star's board believes that the economic case presented in the PEA, coupled with the straightforward brownfield nature of the project, merit the advancement of the project to a feasibility study.

Golden Star will shortly commence this FS, which has been awarded to SRK and will build on and optimize the results from the PEA. The study is expected to be completed in early 2015. Future work will include further infill drilling, detailed geotechnical drilling, further metallurgical test work and hydrology studies, as well as tendering of operating and capital costs. A decision has been taken to commence the construction of an exploration decline from the bottom of the Wassa Main pit in early 2015.

Management believes that with additional drilling from underground there is an opportunity to firstly optimize the mine plan and secondly to potentially add more ounces to the resource base. However, there is no certainty that additional drilling would result in all or any such ounces being included in a mine plan.

Golden Star has not yet completed an FS to demonstrate the economic viability of Wassa underground. Furthermore, no mineral reserves have been established on Wassa underground. Any statements regarding planned production rates, projected cash flows, payback period, IRR and NPV assume that Golden Star is or will be able to complete all of the required steps to bring Wassa underground into commercial production, including the completion of an FS to demonstrate the economic viability of the Wassa Underground, the completion of the environmental assessment process and the successful granting of relevant permits. There is no certainty that Golden Star will be able to complete any or all of these steps.

NI 43-101 technical report

The complete updated NI 43-101 technical report, which will include the PEA, will be filed on SEDAR within 45 days and will also be available on the company's website.

The technical contents of this news release have been reviewed and approved by Dr. Martin Raffield, PEng, a qualified person pursuant to National Instrument 43-101. Dr. Raffield is senior vice-president, technical services, for Golden Star.

Webcast

Golden Star will be presenting at the Denver Gold Show on Wednesday, Sept. 17, 2014, at 8:45 a.m. Mountain Time (10:45 a.m. EST). This presentation will be webcast on the company's website. A replay of this webcast will be available until Dec. 15, 2014.

Technical information and quality control

The technical contents of this news release have been reviewed and approved by Mitchel Wasel, BSc, geology, a qualified person pursuant to National Instrument 43-101. Mr. Wasel is vice-president, exploration, for Golden Star and an active member of the Australasian Institute of Mining and Metallurgy.

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