Drilling on the 007 Zone occurred throughout the year, from surface and underground drilling stations, in order to infill and extend the zone both along strike and to depth. At the beginning of 2011, the 007 Zone had a limited strike length of less than 200 m. A second new zone, then known as Emperor, was located approximately 300 m to the east along the same horizon. Drilling during the year to the east of 007 resulted first in the discovery of 007 East(730 zone) and then 007 Far East(740 zone). As drilling progressed during the year, it was determined that all four zones including the Emperor were part of a continuous stretch of mineralization extending about 500 m (1,640 feet) along strike.

Results obtained from the 2011 drilling program demonstrate consistent grades and widths throughout the 007 Zone, as highlighted by the following drill holes:

--  S922-11-036, intersecting 23.2 g/tonne over 11.5 metres at a depth of
    362 metres 
--  S922-11-013, intersecting 110.1 g/tonne over 2.1 metres at a depth of
    330 metres 
--  S922-11-049, intersecting 44.2 g/tonne over 4.3 metres at a depth of 348
    metres 
--  S922-11-089, intersecting 63.0 g/tonne over 2.8 metres at a depth of 362
    metres 
--  S922-11-091, intersecting 21.7 g/tonne over 7.4 metres at a depth of 362
    metres 
--  S915-11-003, intersecting 11.8 g/tonne over 12.3 metres at a depth of
    396 metres 
--  S915-11-024, intersecting 60.7 g/tonne over 3.0 metres at a depth of 275
    metres 
--  S915-11-045, intersecting 45.6 g/tonne over 4.3 metres at a depth of 291
    metres 
--  S915-11-084, intersecting 17.4 g/tonne over 9.4 metres at a depth of 269
    metres 
--  S915-11-106, intersecting 18.1 g/tonne over 3.2 metres at a depth of 358
    metres

"These results provide a detailed account of one of the richest gold deposits ever discovered in Manitoba. It's extremely impressive that a gold deposit that wasn't even known about two years ago will be contributing 50% of our mill feed well into the foreseeable future," said George Pirie, San Gold's President and Chief Executive Officer.

The 007 Zone is located along and within the Shoreline Basalt rock unit. San Gold views the full length of the Shoreline Basalt and similar parallel rock units as extremely prospective. In 2012, San Gold's drilling program will pursue the 007 Zone westward towards the L10 Zone, a region that has already returned encouraging results. San Gold will also pursue 007 to the east toward the SG-1 Zone, another Shoreline Basalt deposit located 2 km northeast of the 007 Zone. The region between 007 and SG-1 has yet to be significantly drill tested.

The drilling released today covers 261 intercepts over 215 drill holes within the 007 mineralized envelop. 17 of these holes have been released previously and are included here to provide a complete summary of the 007 drilling program in 2011. The full listing of the drill holes can be found in Table 1 of this release. Figures 1 to 5, which illustrate the location of drill holes and intercepts, can be found on the company web site (www.sangold.ca) and on SEDAR (www.sedar.com).

2011 Exploration Program

This drilling was carried out as part of San Gold's 2011 drill program. As of the end of October, the company had completed 300,000 metres of drilling within the Rice Lake Mining Complex. The Company's near-surface exploration activities in 2011 have focused on both exploration and definition drilling along the 007 Zone and within the L10, L13, SG-1 and Cohiba zones. Deep drilling has focused on extensions of the L10 and 007 zones, both from surface and from drilling stations on 16 Level and 26 Level in the Rice Lake Mine. Drilling within the Rice Lake Mine has focused primarily on definition drilling on 26, 28 and 31 Levels.

The surface drill program was carried out under the supervision of W.S. Ferreira, P.Geo., the Qualified Person for this project under National Instrument 43-101. The drill core was 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. Check assays were also performed on pulps and rejects by both TSL and by Accurassay Laboratories of Thunder Bay, ON. The underground drill program was carried out by San Gold mine geologists under the supervision of D. Ginn, P.Geo., the Qualified Person for San Gold under National Instrument 43-101. Underground drill core samples are assayed on site in the company's assay lab using the fire assay method with an AA and gravimetric finish. 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.