TORONTO, ONTARIO--(Marketwire - Sept. 20, 2012) - Sage Gold Inc. (News - Market indicators) has completed a 5 hole surface diamond drill program totalling 2100 metres on its Clavos Gold deposit in Timmins, Ontario. These highlighted assays are from holes drilled into and adjacent to the 960 zone, recently discovered by Sage and located 600 metres east of the existing Clavos deposit and were intended to:

• Test for mineralisation within two new zones - the Contact and Sediment Zones
• Test for down dip mineralisation on section 514975E between CL 11-28 at 1125 elevation and CL 11-26 at 950 elevation. This section has never been drilled and is situated 175 metres east of the center core of the 960 mineralisation
• Test for down dip mineralisation on section 514850E in hole CL 11-21

The current round of drilling has yielded several important results with respect to the configuration and development of the 960 zone mineralization:

• The Hanging Wall results in Hole CL 11-21 are located 125 metres down dip of Hole CL 11-06 (6.31 g/t over 5.4 metres - Press Release 4/26/11). There has been no additional drilling on this section.
  
  
• Drilling on section 514975E yielded potential ore grade results in the Footwall zone of holes CL 11-28 and CL 11-26. There is an interval of 150 metres that is undrilled between section between CL 11-28 and CL 11-26. There has been no drilling below CL 11-26.
  
  
• There were strong Contact and Sediment zone results as contained in CL 11-21, CL 11-28 and CL 11-29. The Contact and Sediment zones have not been encountered in the previous drilling on the 960 zone and are important with respect to the development of the 960 zone. It is contemplated that the 960 mineralization would be developed through access drifts collared from the 250m level of the existing Clavos underground workings. The access drift would be driven east through the sediments with the presence of mineralized grade blocks within the sediment and contact zones providing an opportunity for simultaneous tonnage extraction offsetting the overall capital expenditure requirements for developing the 960 zone.

The Joint Venture between St Andrew Goldfields Ltd. (TSX:SAS) and Sage has now been constituted and the parties have agreed to jointly fund the initial stage of the Joint Venture. Sage is the operator of Clavos with 60% ownership. The immediate objectives are to complete a grade constrained model of the deposit including the recent drill results from the 960 zone and to complete a PEA of the Clavos deposit. The new resource study and the PEA are expected to be completed by Q4 of 2012.

A submission of Notice of Project Status and Notice of Material Change will be provided to the Ministry of Northern Development and Mines once their review of the recent closure plan submitted by SAS, is complete. The closure bond has been funded by Sage, updated and is in place. Environmental requirements for notification of ownership change have been submitted to the Ministry of Environment. Consultation with First Nations is underway.

Sage President and CEO Nigel Lees comments, "We are very encouraged by the recent drill results which reinforces our belief that the 960 zone holds the potential for significant additional resources. However further drilling both from the surface and underground will be required to assess the significance of this potential resource. The drill results detailed in this press release will be added to the new resource estimate currently underway."

Peter Hubacheck, P.Geo.is a Qualified Person as defined by NI 43-101 and has reviewed and authorized the geological information in this news release. Bob Ritchie, P.Geo. is a Qualified Person as defined by NI 43-101 and has reviewed
and authorized the permitting, environmental and mine design aspects pertaining to the advanced underground exploration plans for the Clavos Project in this news release.

SAGE is a mineral exploration and development company which has primary interests in near-term production and exploration properties in Ontario. Its main properties are the Clavos Gold deposit in Timmins and the Lynx deposit and other exploration properties in the Beardmore-Geraldton Gold Camp. Technical reports and information relating to the properties can be obtained from the System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedar.com and www.sagegoldinc.com.

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.