Homeland Energy Closes Rights Offering

TORONTO, July 12 /CNW/ - Homeland Energy Group Ltd. (TSX: HEG) ("Homeland" or the "Company") is pleased to report that it has concluded its Rights Offering (see press releases dated June 2 and 9 and July 2 and 7, 2010). The Company has issued a total of 169,088,393 common shares for total proceeds of $8,454,419.65.

GMR Energy Limited ("GMR") acquired a total of 159,862,800 common shares through its participation in the Rights Offering. Following this transaction, GMR holds 263,119,895 common shares of the Company representing approximately 55.84% of the issued and outstanding common shares of the Company. Crossridge Investments Limited ("Crossridge"), an affiliate of GMR, owns and controls 30,096,012 common shares of the Company. Accordingly, the securityholding percentage of Crossridge and GMR in the common shares of Homeland immediately after the transaction is approximately 62.22% represented by an aggregate of 293,215,907 common shares of the Company. GMR has acquired the shares for long term investment purposes and currently does not intend on acquiring ownership of, or control over, any additional shares of Homeland.

The proceeds of the Rights Offering will be used to repay the $7,993,140 loan made by an affiliate of GMR and for general working capital as disclosed in the final prospectus dated May 31, 2010 as amended by Amendment No. 1 dated June 30, 2010.

Homeland Energy Group Ltd. (TSX: HEG) is a coal producer with operations in the Witbank area of South Africa. The company also has a large-scale development property in South Africa and exploration interests in Southern Africa. Homeland will continue to seek out interests in additional coal projects in South Africa and neighbouring countries as well as internationally. Homeland is a shareholder in Homeland Uranium Inc., a Canadian uranium exploration company focused on projects in Niger and the United States. Homeland Energy Group Ltd. is currently traded on the Toronto Stock Exchange under the symbol "HEG" with 302,115,756 common shares issued and outstanding. www.homelandenergygroup.com.

SOURCE HOMELAND ENERGY GROUP LTD.

For further information: For further information: Jeff Lowe, Acting Chief Financial Officer, Homeland Energy Group Ltd., +1 416 506-1979, info@homelandenergygroup.com, www.homelandenergygroup.com, Please visit www.homelandenergygroup.com

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HOMELAND ENERGY GROUP LTD.

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