Saw this on the other board. I've underlined what I consider to be the interesting part:

"San Gold expects to produce about 60 000 oz to 70 000 oz of gold this year, mostly from development work..."

It looks like our suspicions were correct, and they've been mostly milling their seemingly endless supply of development ore.

http://www.miningweekly.com/article/san-gold-eyes-200-000-ozy-from-manitoba-operations-2010-09-20

TORONTO (miningweekly.com) - Canadian gold junior San Gold could ramp up to produce as much as 200 000 oz/y from its Manitoba operations, CEO Dale Ginn said in a presentation on Monday.

San has made a number of high-grade gold discoveries around the old Rice Lake mine and has already put one of them, called Hinge, into production.

The company has made seven discoveries over five years, all of which are within two or three kilometres of its mill, Ginn said.

The firm continues to explore and expand on the discoveries, and is optimistic that the deposits can be extended to to depth.

San Gold expects to produce about 60 000 oz to 70 000 oz of gold this year, mostly from development work, but will increase output to some 120 000 oz in 2011 when it starts production from the 007 deposit.

Output is then expected to ramp up from all three deposits - Rice Lake, Hinge and 007 - to up to 200 000 oz/y. Other deposits also have the potential to add further upside, Ginn said.

The company plans to start an expansion of its mill next year, and is looking at increasing capacity from 1 250 t/d to some 1 800 t/d.