(OTCQB: CGFIA) (PINKSHEETS: CGFIA) announces tha

 (OTCQB: CGFIA) (PINKSHEETS: CGFIA) announces that the Company has received
approval of its Reclamation Permit Amendment (AM-03) Application for the
Company's Pride of the West Mill.

The Pride of the West Mill, near Silverton, Colorado is located within the
famous "San Juan Triangle" mining center of southwestern Colorado, which also
includes the historic mining towns of Telluride and Ouray, and encompasses one
of the most richly mineralized areas of North America. The mill has the
capability to process five metals: gold, silver, copper, lead, and zinc. The
mill has an ultimate capacity of 700 tons per day.

Colorado Goldfields has received over $9 million in preliminary purchase orders
for toll gold/silver ore milling in advance of the permit process completion
from gold/silver ore mines in the area, including: The Silver Wing, Red Arrow,
Golden Wonder, and Ruby Trust.

"This event materially transforms the Company. The approval has brought renewed
attention to the Company's acquisition plan. Inquiries have already been
received from several of the 23 mines within 25 miles of the mill, which have
confirmed viable ore concentrations representing an estimated $3 billion worth
of metals still in the ground. We believe that the Company is now in a position
to access meaningful capital funding on reasonable terms," stated C. Stephen
Guyer, CFO of Colorado Goldfields.

Contributing to the design was Bryan Ulrich, P.E., Senior Vice President for
Knight Piesold Consulting. Knight Piesold is an international consulting company
providing engineering and environmental services for mining, power, water,
transportation and construction sectors around the globe. In the late 1980s Mr.
Ulrich completed the site investigation, analyses, design and resident
engineering for the Sunnyside #3 tailings facility in Silverton, which converted
the facility from a cycloned operation to a conventional earth-fill dam and
ended much of the dust problem that was previously attributed to the facility.

The Colorado Division of Reclamation, Mining and Safety finalized its decision
to approve with conditions on August 9, 2012.

Consistent with the new character of the Company, the Board of Directors has
approved a 5,000 for 1 reverse stock split of the Company's Class A Common Stock
as of August 21, 2012, and has filed the necessary material to effect the
reverse split with FINRA. The Board of Directors believes that the current
market price of the Company's Class A Common Stock is impairing its
acceptability to certain investors, clearing firms, and other members of the
investing public, and has approved the reverse split in anticipation that it
could result in a significant improvement in the per share price of the stock.

C. Stephen Guyer, Chief Financial Officer of Colorado Goldfields, stated, "We
are effecting a reverse stock split to better align the stock price with the
Company's accomplishments and operational objectives. Further, we have performed
extensive multi-variate analysis surrounding this action. We believe this
transaction will broaden our shareholder base, increase the appeal of the stock
to investors, and help facilitate electronic transactions of our stock through
DTCC. While reverse splits are sometimes viewed as a negative event, we strongly
believe that this split will provide benefits to our shareholders by improving
trading accessibility and liquidity, thereby enhancing long-term shareholder
value."

Every 5,000 shares of Class A common stock of CGFIA will automatically combine
into one share of Class A common stock. The Reverse Split will reduce the number
of shares of outstanding Class A common stock from approximately 28.2 billion
pre-split to approximately 5.7 million post-split. The number of authorized
shares of Class A common stock will be reduced from 35 billion to 7 million.
Proportional adjustments will be made to Colorado Goldfields' convertible notes
and equity compensation plans. All fractional shares will be rounded up to the
nearest whole number. The Reverse Split will not negatively affect any of the
rights that accrue to holders of CGFIA common stock or common stock equivalents.
The reverse split is not a taxable event to existing stockholders.

"The agency conditions regarding the tailings repository are modest and we
expect to complete the additional analysis within 90 days. At the same time work
has commenced on other areas of the facility. The future of Colorado Goldfields
is bright and our confidence level is high that the Company will become a leader
in mining and milling in the state of Colorado," said Lee R. Rice, President and
CEO of Colorado Goldfields.