TORONTO, ONTARIO--(Oct. 20, 2008) - Sage Gold (TSX VENTURE:SGX) (the 'Company') is pleased to announce that it has closed a non-brokered private placement of Cdn $1,250,000 through the sale of 10,000,000 flow-through units at $0.125 per unit to MineralFields Group.

This placement is in addition to the previously announced placement of $1,950,000 under the same terms and conditions, for an aggregate flow-through financing of $3,200,000 of a proposed $3,750,000 financing. Each unit consists of one flow-through common share plus one-half of one share purchase warrant. Each whole warrant is exercisable at $0.20 for 24 months from the Closing Date of the offering.

First Canadian Securities®, a division of Limited Market Dealer Inc. was paid a cash finder's fee of $72,000 and was issued 768,000 broker warrants equal to 8% of the units sold pursuant to the offering.

If the Company's common shares achieve a closing price of $0.30 or higher for a period of 21 consecutive trading days, the Company may, at any time after the expiry of the hold period, notify the warrant holders that all unexercised warrants will expire 30 days following the date that the notice is issued.

All securities are subject to a four month hold period which expires on February 18, 2009. This financing is subject to final approval of the TSX Venture Exchange.

The net proceeds of the private placement will be used to fund the Company's exploration programs in Ontario.

"We are very pleased to be continuing our relationship with MineralFields Group, and we look forward to working with MineralFields Group as we further explore our properties in Ontario" said Nigel Lees President and CEO.

About MineralFields, Pathway and First Canadian Securities®

MineralFields Group (a division of Pathway Asset Management) is a Toronto-based mining fund with significant assets under administration that offers its tax-advantaged super flow-through limited partnerships to investors throughout Canada during most of the calendar year, as well as hard-dollar resource limited partnerships to investors throughout the world. Pathway Asset Management also specializes in the manufacturing and distribution of structured products and mutual funds. Information about MineralFields Group is available at www.mineralfields.com. First Canadian Securities®, a division of Limited Market Dealer Inc., is active in leading resource financings (both flow-through and hard dollar PIPE financings) on competitive, effective and service-friendly terms, with investors both within, and outside of MineralFields Group.

SAGE is a mineral exploration and development company which has interests in exploration properties in Ontario, Quebec, Nevada and Arizona. Its main properties are the Onaman, Paint Lake and Jacobus- Golden Extension properties in the Beardmore Geraldton Gold Camp in Ontario. Technical reports relating to the properties can be obtained from the System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedar.com

For all Sage Gold Inc. investor relations needs, investors are asked to visit the Sage Gold Inc. IR Hub at http://www.agoracom.com/IR/sagegold where they can post questions and receive answers within the same day, or simply review questions and answers posted by other investors. Alternatively, investors are able to e-mail all questions and correspondence to sgx@agoracom.com where they can also request addition to the investor e-mail list to receive all future press releases and updates in real time.

This release was prepared by management of the Company who takes full responsibility for its contents.

This news release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended and "Forward Looking Information" within the meaning of applicable Canadian securities legislation. Some forward looking statements and forward looking information contained in this release are forward-looking and, therefore, involve uncertainties or risks that could cause actual results to differ materially. Such forward-looking statements include comments regarding mining and milling operations, mineral resource statements and exploration program performance. Factors that could cause actual results to differ materially include metal price volatility, economic and political events affecting metal supply and demand, fluctuations in mineralization grade, geological, technical, mining or processing problems, exploration programs and future results of exploration programs, future profitability and production. The Company disclaims any obligation to update forward-looking statements.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.