San Gold drills 3.9 m of 37 g/t Au at Hinge

2009-05-28 08:27 ET - News Release

Mr. Dale Ginn reports

SAN GOLD UPDATES HINGE ZONE PROGRESS AND ADDS NEW HIGH GRADE ZONES

San Gold Corp.'s definition drilling continues to confirm and extend multiple high-grade, near-surface deposits within the collective Hinge zone. Drilling from surface as well as underground has, in addition to defining the known lenses (#1 and #2, previously labeled Hinge #4), has also discovered four additional lenses (#3, 4, 5 and 6) as highlighted by drill holes # H96-09-08 which encountered 37 g/tonne (1.07 oz/ton) over 3.9 meters (12.8 ft) and # GS-09- 77 which cut 30 g/tonne (0.88 oz/ton) over 2.1 meters (7.0 ft) in lens #6. The proximity of the # 3 lens led to its immediate development at the 100 meter level, a description of this development is provided below in the body of this news release. The other additional lenses located to the footwall of lens #1 and #2 have been referred to in prior news releases as "other footwall" zones and are undergoing further definition and interpretation by San Gold geologists. An update on other Hinge zone activities and developments is provided below as well.

All of the drill hole intersections as reported are within 150 meters (500 ft) of surface. Twelve intersections are reported within ten drill holes as tabulated below:

Hole #                         Length         Gold g/tonne (oz/ton)          Zone                   Drilled from

GS-09-77               5.2 m     (17.0 ft)            13.7     (0.40)        Hinge Lens 1           Surface

and                    2.1 m      (7.0 ft)            30.1     (0.88)        Hinge Lens 6           Surface

GS-09-76               3.9 m     (12.7 ft)            18.5     (0.54)        Hinge Lens 1           Surface

GS-09-75               2.4 m      (7.9 ft)            34.6     (1.01)        Hinge Lens 1           Surface

GS-09-73               2.2 m      (7.3 ft)            12.3     (0.36)        Hinge Lens 3           Surface

H96-09-06              3.4 m     (11.0 ft)            30.6     (0.89)        Hinge Lens 1           UG

H96-09-08              2.0 m     (6.4 ft)             25.3     (0.74)        Hinge Lens 1           UG

and                    3.9 m     (12.8 ft)            36.6     (1.07)        Hinge Lens 6           UG

965-09-008             1.2 m     (4.0 ft)             32.2     (0.94)        Hinge Lens 3           UG

965-09-009             4.7 m     (15.5 ft)            16.8     (0.49)        Hinge Lens 3           UG

965-09-011             1.2 m     (4.0 ft)             81.5     (2.38)        Hinge Lens 3           UG

965-09-013             1.8 m     (6.0 ft)             30.5     (0.89)        Hinge Lens 3           UG
 

Over 750 feet (230 m) has been developed so far within the mineralized zones at the 100 meter level on three distinct lenses (#1, #2 and #3). The #3 lens was recently discovered during the definition drilling and development of the #1 and #2 lenses and is located to the footwall of the #2 lens. The #3 lens has subsequently been developed with face samples averaging 0.74 oz/ton (25.3 g/tonne) over an average true width of 3.5 feet (1.1 m) and a strike length of 200 feet (61 meters). Individual face grades have assayed up to 1.40 oz/ton (48.0 g/tonne) over a true width of 6.0 feet (1.8 m) with visible gold being routinely observed throughout. Within the #3 lens, 21 development faces were chip sampled over a strike length of 200 feet (61 meters) resulting in a total of 98 samples assayed for gold with individual values ranging from 0.01 oz/ton (0.34 g/tonne) to 7.55 oz/ton (259 g/tonne). All assays are uncut, with capping if required to be determined as a part of the bulk sampling process.

The Hinge zones at the 100 meter level consist of multiple zones or lenses and numerous vein offshoots that have been encountered during development. Mineralization consisting of pyrite and free gold are hosted by quartz-carbonate-tourmaline veins within mafic to intermediate tuffs and flows. Sericite and chlorite alteration halos surround the veining in the #2 and #3 lenses within a tight range. The veining exhibits an average dip to the north west of 60 to 75 degrees and observed ground conditions are excellent to date. Level development continues in both the east and west directions as well as in numerous vein offshoots while incline and decline development is ongoing in order to access the zones at levels above and below the 100 meter level by mid June. The main alimak ventilation raise is also underway and has advanced over 250 feet or 50% to date with break through to surface expected in early June.

The Hinge zone has now been drill tested between section 0 east and 800 east (feet), (250 m) and to depths of over 1,200 feet (400 m) demonstrating excellent continuity in both structure and grade. This zone remains open along strike to the north-east and to the south-west as well as at depth. Two drill rigs continue to define the known Hinge zones while a third drill rig is searching for parallel veins to the north. 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.

A fourth drill has targeted the next hinge-like axis or pathway located approximately 0.5 kilometers to the east of the known Hinge zones. Veining and mineralization similar to the Hinge zones in terms of geometry and composition, including observed visible gold have now been encountered by multiple drill holes in this area. Assay results will be released upon receipt by San Gold.

Over 3,700 tons of Hinge Lens #1 and #2 bulk sample development material from the 100 meter level has been processed to date in the Rice Lake mill. Approximately 1,500 tons of development material from the #3 lens is currently being processed as well. The first bench or stope material is also being stockpiled from the #1 and #2 lenses and is scheduled to be processed shortly.

A plan view showing the location of the lenses and a longitudinal section with development are available at San Gold's website: www.sangoldcorp.com, as well, an updated model in 3-d and cross section views is available at www.corebox.net .

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. Definition drill core samples are assayed on site in the company's assay lab using the fire assay method with an AA and gravimetric finish. Chip and muck 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.