Homeland Energy Sells 5% Interest in Its South African Subsidiary to GMR Group of Bangalore, India

TORONTO, ONTARIO, Apr 17 (MARKET WIRE) --
Homeland Energy Group Ltd. (TSX: HEG) ('Homeland' or 'the Company') is
pleased to announce that it has completed the sale of five per cent (5%)
of its South African subsidiary, Homeland Mining and Energy SA (Pty) Ltd
("Homeland South Africa") to GMR Energy Limited ("GMR Group") of
Bangalore, India for a cash payment to Homeland of US$15 million. GMR
Group maintains options to acquire an additional 5% and 40% of Homeland
South Africa valuing the Company's subsidiary at US$310 million. If all
three options are exercised by September 2, 2008, Homeland Energy will
receive a total of US$155 million for the sale of 50% of Homeland South
Africa. Details of the three options are included below. The sale to GMR
Group incorporates the projects and properties held within Homeland's
South African subsidiary, including the Kendal Mine, Eloff coal mining
project, the Northfield site reclamation project as well as exploration
projects in South Africa. The transaction excludes Homeland Energy's
corporate interests in Homeland Uranium, Altona Resources and other
projects under consideration in southern Africa and elsewhere.

"This transaction represents a strategic move forward for Homeland Energy
Group, as well as an endorsement of the quality of the underlying assets
of the Company," commented Stephen Coates, President and CEO. "Our Board
and management team believe that a partnership with an organisation of
the quality of the GMR Group and the cash resulting from this deal
provides the independence to develop the Eloff coal project, as well as
other global opportunities that may arise. As these funds will be paid to
Homeland's corporate entity, we are not limited to southern Africa for
the deployment of the funds."

According to BVN Rao, Chairman & Managing Director of GMR Energy Limited:
"The acquisition of sizeable coal assets overseas is a very critical part
of GMR Group's international energy business strategy. Apart from
ensuring fuel security for GMR Group's power projects in India, such a
transaction also acts as a catalyst in the development of the energy
business group. In our search for such assets we found that Homeland
South Africa provided us with a perfect platform to grow the group's
thermal energy portfolio. We are very pleased to be associated with
Homeland Energy as a strategic partner in coal ventures. Apart from the
quality and size of Homeland's South African coal assets, especially the
development potential of the Eloff Project, we are impressed by the
technical expertise, country specific knowledge and, above all, the
commitment shown by the Homeland team. We, in turn, are committed to
developing Homeland South Africa's assets into a world-class venture."

The GMR-Homeland Transaction

The conclusion of this initial sale by Homeland to GMR Group follows the
negotiation of a Shareholders' Agreement and a Share Purchase Agreement
(the "SPA") setting out the terms and conditions upon which Homeland
agreed to sell up to a 50% voting and participating equity interest in
Homeland South Africa to GMR Group. Following signing of a memorandum of
understanding (the "MOU") in December 2007, Homeland received a payment
of US$3 million. The additional payment made on April 15, 2008 of US$12
million completes the sale of the first 5% of the shares of Homeland
South Africa for a total purchase price of US$15 million (the "First
Option").

GMR Group holds an option - subject to conditions precedent - to purchase
a further 5% of the shares of Homeland South Africa from Homeland for a
purchase price of a further US$15 million on or before the date which is
the later of May 1, 2008 and the date which is 10 days following receipt
of an updated Independent Technical Report on the mineral resource at
Homeland's Eloff property (the "Second Option").

If the Second Option is exercised, GMR Group holds a final option to
purchase 40% of the shares of Homeland South Africa for either US$125
million, if such option is exercised on or before September 2, 2008, or
US$135 million, if such option is exercised after September 2, 2008 but
on or before December 31, 2008 (the "Third Option").

The SPA provides Homeland with the right to buy back the Homeland South
Africa shares sold under the First Option if the Purchaser does not
exercise the Second Option. The purchase price for the shares subject to
this buy back right is payable in cash and is equal to the original price
paid plus 10% interest accruing from the date that the First Option was
completed. The SPA also provides Homeland with the right to buy back the
Homeland South Africa shares sold under the First Option and the Second
Option if the Purchaser does not exercise the Third Option. The purchase
price for the shares subject to this buy back right is payable in cash
and is equal to the original price paid plus 10% interest accruing as to
50% from the date that the First Option was completed and as to 50% from
the date that the Second Option was completed.

GMR Group Limited

GMR Group is a Bangalore headquartered global infrastructure group with
interests in Airports, Energy, Highways and Urban infrastructure as well
as in the manufacturing sector, spanning the Agri-business including
Sugar and Ferro alloys. The company is one of the fastest growing
infrastructure organizations in India. Employing the Public Private
Partnership model, the GMR Group has successfully implemented several
infrastructure projects in India. With completion of the development of
India's newest airport in Hyderabad, and the Delhi International Airport
project well underway, GMR Group has established itself as a frontrunner
and pioneer in the core infrastructure areas of the country. GMR's
subsidiary, GMR Infrastructure Limited ("GIL"), is a Bombay-listed
publicly traded company with a market capitalization in excess of US$6
billion.

When the Government of India opened the power sector to investments from
the private sector, GMR Group took a strategic decision to venture into
this sector. Over more than a decade, the Group has established its
credentials and now has three power plants in Mangalore, Chennai and
Andhra Pradesh. The GMR Group is currently developing three more power
projects.

An infrastructure holding company, GIL was formed to fund the capital
requirements of the GMR Group's initiatives in the infrastructure sector.
GIL is engaged in the development of various infrastructure projects in
the power and transportation sectors through several special purpose
vehicles.

GMR Group's assets include six power plants, three of which are in
production today, six road projects, two of which are in commercial
operation and four are under development; and two airport projects, the
recently completed Rajiv Gandi International Airport and the
modernization and re-development of the Delhi International Airport. The
GMR Group plays an active role in all stages of development of all
projects, including the supervision of construction services, financing
and operation.

The GMR Group is also actively engaged in the areas of Education, Health,
Hygiene and Sanitation, Empowerment & Livelihoods and Community-Based
Programs under its Foundation wing, reaffirming its grass root presence
as change agents of society in the field of Corporate Social
Responsibility. A dedicated division, the GMR Varalakshmi Foundation,
manned by committed professionals, oversees and manages these projects
across India.

Homeland Energy Group Ltd. is a producing coal company, traded on the
Toronto Stock Exchange under the symbol "HEG". The company is focused on
energy exploration and development in Southern Africa. Homeland owns two
producing operations - the Kendal Mine near Witbank, South Africa and the
Northfield site reclamation project near Dundee, South Africa - an
advanced development coal project in South Africa (Eloff coal mining
project) and a number of early-stage exploration properties in the
provinces of Mpumalanga and Kwa-Zulu Natal. The Company is currently
negotiating to acquire interests in a number of additional coal
properties in eastern South Africa and neighbouring countries. Homeland
is also a significant shareholder in Homeland Uranium Inc., a Canadian
uranium exploration and development company focused on projects in Niger
and the United States, and has several other global strategic
investments. Homeland Energy Group Ltd. began trading on the Toronto
Stock Exchange on March 5, 2008 and has 146,041,117 common shares issued
and outstanding.

Contacts:
Homeland Energy Group Ltd.
Naomi Nemeth
VP, Investor Relations
(416) 542-3978
Email: nnemeth@homelandenergygroup.com

Homeland Energy Group Ltd.
Stephen Coates
President and Chief Executive Officer
+44 20 7016 9881
Email: scoates@homelandenergygroup.com
Website: www.homelandenergygroup.com

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