TSX: SGR  |  OTCQX: SGRCF
www.sangold.ca

BISSETT, MB, April 27 /CNW/ - George Pirie, President and CEO of San Gold Corporation (TSX: SGR) (OTCQX: SGRCF) is pleased to report that crushing plant upgrades have been completed and that test milling has shown a large increase in production capacity for Rice Lake Project mill operations. The first full week of operations using the improved crushing circuit (April 15 to April 21) realized an average of 1,513 tons per day processed, including an all-time daily record of 1,679 tons.  Recovery rates were maintained at 94% during this period.

"These capital improvements were completed ahead of schedule and have increased our mill's capacity beyond design specifications," said Mr. Pirie. "This, combined with strong production tonnages keeping ore out in front of the mill, marks another important step toward establishing a steady-state production profile."

The crushing plant upgrades were completed during the first four days of April and consisted of the installation of a new Metso mobile gyratory crusher as well as a new Barmac mobile tertiary crusher.  A new Elrus primary jaw crusher was previously installed in January. The combined result of these installations is an increase from 210 hp to 750 hp, allowing for increased throughput while reducing the size of the feed reporting to the grinding circuit.  Further capacity increases are anticipated towards 1,800 tons per day or higher this year as this new equipment is optimized and a larger capacity screening plant is installed in June.

San Gold Corporation is an emerging gold producer located in south-east Manitoba, immediately west of Red Lake, Ontario.  The company is on track to produce over 80,000 ounces in 2011.

San Gold is also an aggressive explorer and developer, discovering seven gold deposits and developing four over the past five years. The company is on track to complete over 300,000 meters of diamond drilling this year.  Drilling and development efforts are currently concentrated along a new mining horizon known as the Shoreline Basalt.  The Shoreline Basalt deposits, which include L10, L13, 007, 007 East and Emperor, are fully accessible from surface and to depths of over 2,000 meters using the modern mine infrastructure already in place at the Rice Lake Mine.  This year's drilling and development program will mark a key step in San Gold's long-term plan to develop a new mine complex along the Shoreline Basalt.