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San Gold Discovers New High Grade Zone East of Hinge Deposits

Friday, June 12th, 2009

Dale Ginn, CEO of San Gold Corporation (TSX-V: SGR) is pleased to announce that exploration drilling has discovered a new high grade gold zone near surface located approximately 0.5 kilometers to the east of the developing Hinge zones and 2 kilometers to the north east of San Gold’s Rice Lake mine site and mill facility. Drill testing of the next hinge axis or pathway target to the east of the Hinge zone has led to this discovery and has now been confirmed by a number of drill holes. Hole #LM-09-22 encountered 25.4 g/tonne (0.74 oz/ton) over 2.1 meters (7.0 ft) within 100 meters of surface, with numerous other drill holes confirming continuity over a 100 meter strike length so far. This new discovery appears to be stratigraphically in the same horizon as the Hinge #1 lens and may be an extension of that zone. Ongoing drilling will continue to fill in the 0.5 km information void between the Hinge #1 lens and the new discovery.

All of the drill hole intersections encountered so far, as reported below are within 100 vertical meters of surface:

Gold g/tonne
Hole # From To Length (oz/ton) Zone
LM-09-22 100.6 m 102.7 m 2.1 m (7.0 ft) 25.4 (0.74) Cohiba
LM-09-16 115.7 m 117.7 m 2.0 m (6.6 ft) 14.1 (0.41) Cohiba
LM-09-14 110.0 m 112.0 m 2.0 m (6.6 ft) 21.4 (0.63) Cohiba
LM-09-06 113.8 m 115.5 m 1.7 m (5.6 ft) 4.1 (0.12) Cohiba
LM-09-02 99.6 m 100.7 m 1.1 m (3.6 ft) 13.7 (0.40) Cohiba

Dale Ginn, CEO of San Gold stated, “San Gold geologists, led by Bill Ferreira continue to demonstrate incredible success testing their in-house structural geological model that they are using as an exploration guide. We have discovered and developed six high grade Hinge deposits within the space of one year, and are now already looking to repeat that success with the discovery of this nearby zone. It is becoming obvious that the Hinge zone is not a ‘one-off’ but part of a much larger mineralized system that has infiltrated the multi-kilometer thick volcanic sequence that was only partially prospected in the 1920s and 1930s. Our understanding of this large ‘camp scale’ system is accelerating rapidly within our large mine lease and land position. Discovery here can lead to immediate development and high grade production as demonstrated by currently initiated operations at the Hinge zones.”

The mineralization and geological characteristics of this new discovery are identical to the Hinge zones in every respect including the presence of abundant visible gold. Surface drilling continues to expand this deposit which is completely open along strike and to depth. Drilling is also targeting the next axis or pathway target located approximately 0.5 kilometers to the west of the Hinge deposits. The currently known Hinge zones are located approximately 1.5 kms to the north-east of San Gold’s operating Rice Lake and mine and mill, and are fully accessible by San Gold’s private road, and all lie within San Gold’s fully permitted mine lease.

Location plans are available in the graphical version of this press release at San Gold’s website: www.sangoldcorp.com.

This program was carried out under the supervision of W.S. Ferreira, P.Geo., and D. Ginn, P.Geo., the Qualified Persons for this project under National Instrument 43-101. Exploration drill core is split, with half sent to TSL Laboratories in Saskatoon, SK and fire assayed with an AA and gravimetric finish. Whole metallic assays were performed on samples containing visible gold. San Gold’s quality control and assurance program includes the insertion of standards, the retention of pulps and rejects, and spot checks utilizing independent labs including TSL Laboratories in Saskatoon, SK and Accurassay Laboratories of Thunder Bay, ON. The core lengths are actual lengths as drilled and have not been adjusted for the true width of the mineralized zones.

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