The "98" vein area is located at the southeastern extremities of current Rice Lake mine development above the 28th level (4500 ft). The past two years have been spent improving access and infrastructure to this area in preparation for mining and exploration. This area of the mine is anticipated to account for 30% of San Gold's production for 2010 and has already contributed to an improvement in Rice Lake's production grade to 0.30 oz/ton in December. The main "98" vein above the 28th level has been developed to over 500 feet in length and is open above where drilling from the 26th level (4200 ft) is searching for extensions. Mining is now underway in numerous stopes within this vein above the 29th and 28th levels. The numerous new veins being discovered to the southeast and in the footwall of the "98" vein are in previously unexplored areas as there has been no access to this ground in the past. Numerous drill holes are now in the process of being deepened since the number and extent of new footwall zones is greater than anticipated.

Dale Ginn, CEO, stated, "San Gold management have long understood that developing higher grade areas of the Rice Lake mine in an upward and outward direction, rather than solely downward, are key to improved economics within this mine. This effort is now resulting in new high grade discoveries in open extensions to the host Rice Lake mine unit, as well as providing deep platforms for exploration well below the newer near surface Hinge, 007, L13 and Cohiba zones that are located in the hanging volcanic rock units. Our ability to chase these new deposits to depth is greatly enhanced by these developments. Our efforts will continue in an upward direction in order to improve ounces per vertical meter and to above 26 level where the use of our internal D winze (shaft) is not required, resulting in greater ore handling efficiencies."

Bulk Sampling Commences at 007 Zone, Drilling Confirms High Grade Corridor, Operational Update and Outlook including Expansion Plans

Dale Ginn, CEO of San Gold Corporation (SGR: TSX-V) is pleased to report that infill drilling is confirming the high grade nature of the 007 Zone at all depths within currently known limits, especially within an established high grade corridor (HGC) that extends from surface to over 400 meters deep and remains open. Results from the infill drill program in the immediate area of planned bulk sampling include drill hole # CD-10-091 which yielded 134 g/tonne (3.9 oz/ton) over 3.1 meters (10.2 ft) at 240 meters (800 ft) below surface within a broader intersection of 53 g/tonne (1.55 oz/ton) over 9.6 meters (31.5 ft). Near surface or upper extension results were highlighted by drill hole # CD-10-68 which cut 26.5 g/tonne (0.77 oz/ton) over 3.3 meters (10.8 ft). Results from the lower extension of the deposit include drill hole # CD-10-040 which yielded 19 g/tonne (0.55 oz/ton) over 2.5 meters (8.2 ft) at a depth of 411 meters (1,350 ft) below surface. A summary of the current round of drill results is contained within the following table, as well, a detailed longitudinal section showing all results received to date are available on the company’s website. Eight intersections are reported within six drill holes as tabulated below ....................................................................................DRILL and they well come. Traps7