Mr. Jeremy Link reports

SAN GOLD REPORTS RECORD QUARTERLY GOLD PRODUCTION AND PROVIDES NOTICE OF SECOND QUARTER 2011 FINANCIAL RESULTS CONFERENCE CALL

San Gold Corp. has released preliminary operating results for the second quarter of 2011. The company is planning to report second quarter 2011 financial results before market open on Monday, Aug. 15, 2011, and senior management will host a conference call that day at 11 a.m. Eastern Standard Time.

Second quarter 2011 operating results

In the second quarter of 2011, the company's Rice Lake, Hinge and 007 mines produced a quarterly record of 20,055 ounces of gold at a cash operating cost that is expected to be below the company's full-year guidance of $825 per ounce of gold sold. Year-to-date production of 34,743 ounces is consistent with the company's full-year production forecast of 80,000 ounces.

Commenting on these results, George Pirie, president and chief executive officer of San Gold, stated: "I am very pleased with this quarter's operating results as they demonstrate that we continue to execute on our plan of growing the production profile and lowering the cost profile of the Rice Lake project. In addition, we continue our aggressive exploration program, which is designed to significantly grow our mineral resource base."

Gold production in the second quarter of 2011 was approximately 118 per cent higher than gold production of 9,188 ounces in the second quarter of 2010 and 37 per cent higher than gold production of 14,688 ounces in the first quarter of 2011. Gold production in the first half of 2011 increased 61 per cent compared with gold production of 21,650 ounces in the first half of 2010.

Higher gold production in the second quarter of 2011 was primarily attributable to increased crushing and milling system capacity resulting in higher throughput relative to prior periods. Gold production in the second quarter of 2011 also benefited from approximately 80 per cent of the milled tonnage being sourced from the generally lower-cost and higher-grade Hinge and 007 mines. The Hinge and 007 mines are expected to continue to be the primary sources of ore at the company's Rice Lake mill for the foreseeable future.

During the second quarter of 2011, the company milled ore at a record quarterly rate of approximately 1,260 tons per day for a total of 114,624 tons, an increase of 97 per cent compared with the rate of 639 tons per day in the same period of 2010. In the second quarter of 2011, the average head grade of 6.34 grams of gold per tonne of ore (g/t Au), an increase of 9 per cent relative to the average head grade of 5.82 g/t Au in the same period of 2010. The company continues to have a substantial surface stockpile of approximately 25,000 tons of ore ahead of the crushing circuit.

Commenting on the improved quarterly operating results, Ian Berzins, chief operating officer of San Gold, stated: "This quarter's record gold production is a direct result of nearly two years of successfully executing on our strategy of debottlenecking the operation, improving safety performance, and investing in new infrastructure and equipment. We continue to make incremental improvements at the Rice Lake project."

Key operational metrics and production statistics for the second quarter of 2011 compared with the second quarter of 2010 and the first quarter of 2011 are presented in the associated tables.

Notice of second quarter 2011 financial results conference call

The company's senior management plans to host a conference call on Monday, Aug. 15, 2011, at 11 a.m. Eastern Standard Time to discuss the 2011 second quarter financial results, and to provide an update of the company's operating, exploration and development activities.

Participants may join the conference call by dialling 1-888-231-8191 or 1-647-427-7450 for outside Canada and the United States. The conference call will also be available by webcast.

A recorded playback of the conference call can be accessed after the event until Aug. 22, 2011, by dialling 1-800-642-1687 or 1-416-849-0833 for calls outside Canada and the United States. The pass code for the conference call playback is 81672417. The archived audio webcast will also be available on the company's website.

       SECOND QUARTER 2011 AND 2010 PRODUCTION 
            SUMMARY AND STATISTICS (1,2)
                                         Q2           Q2
                                       2011         2010

Ore mined (tons)                    119,745       63,024
Ore milled (tons)                   114,624       58,156
Head grade (g/t Au)                    6.34         5.82
Ounces of gold produced (3)          20,055        9,188
Ore mined per day (tons)              1,316          693
Ore milled per day (tons)             1,260          639
Mill recovery (%)                       95%          93%


Notes
(1) All amounts for second quarter 2011 are 
preliminary and based on initial end-of-period 
estimates. Final adjustments may be required.
(2) Certain numbers may not compute due to the 
effects of rounding and truncation.
(3) Before final refinery settlements, which may 
result in increases or decreases to reported gold 
production.

     YEAR-TO-DATE PRODUCTION SUMMARY AND STATISTICS (1,2)

                                      Q2         Q1        YTD
                                    2011       2011    Q2 2011

Ore mined (tons)                 119,745    102,200    221,945
Ore milled (tons)                114,624     82,792    197,416
Head grade (g/tonne Au)             6.34       6.47       6.40
Ounces of gold produced (3)       20,055     14,688     34,743
Ore mined per day (tons)           1,316      1,136      1,119
Ore milled per day (tons)          1,260        910      1,091
Mill recovery (%)                    95%        94%        94%


Notes
(1) All amounts for second quarter 2011 are preliminary 
and based on initial end-of-period estimates. Final 
adjustments may be required.
(2) Certain numbers may not compute due to the effects 
of rounding and truncation.
(3) Before final refinery settlements, which may result 
in increases or decreases to reported gold production.

We seek Safe Harbor.