Sage Gold, Gryphon hire SRK for Borealis bankable study

2010-04-29 10:53 NT - News Release

See News Release (C-SGX) Sage Gold Inc

Mr. Nigel Lees of Sage Gold reports

SAGE AND GRYPHON RETAINS SRK FOR BOREALIS MINE BANKABLE STUDY

SRK Consulting Inc. has completed Sage Gold Inc.'s due diligence review of the Borealis prefeasibility study filed by Gryphon Gold Corp. in September, 2009. SRK has been engaged to prepare a bankable study for use in project financing.

SRK has provided a comprehensive list of recommendations which when implemented will assist in the preparation of a bankable study to support project financing. Key recommendations include:

• Metallurgy
  • Additional metallurgical work is recommended in the form of column tests for the in situ oxide and mixed material.
• Mine planning and operating costs
  • The company will update the contractor costs for mining, crushing, agglomerating and stacking of ore. Further clarification is required for distribution of power and associated costs.
• • It will process engineering additional confirmation of the process design incorporating the results of the new column leach tests.
• Resource
  • A new resource estimate will be prepared which incorporates the results of the metallurgical work, tighter grade constraints and the results of additional drilling. The new resource would form the basis for updated reserves.

Gryphon will, in the near future, undertake a drilling program designed to confirm and potentially expand resources at Borealis. Sage and Gryphon jointly will finance an additional core drilling program to provide sample material for the proposed metallurgical testing. Borealis was successfully mined by previous operators during the 1980s when gold prices were lower. There are substantial oxidized portions of the deposit amenable to open-pit mining which is the subject of the upcoming bankable study. Exploration has identified primary sulphide mineralization below the oxide deposit. Cash flow from the oxide operation would be intended to finance the further drilling and potential development of the sulphide resource if feasible.

The upcoming Gryphon drill program will have as its objective upgrading inferred oxide resources reported in the 2008 National Instrument 43-101 technical report (entitled, "Canadian NI 43-101 preliminary assessment of the mineral resources of the Borealis gold project") to the measured and indicated category and potentially adding new oxide resources. The drill program will test multiple targets within the permitted area with the designed intent of adding additional gold ounces to the short-term mine plan. Targets include extension of known ore zones, infill drilling and identification of additional mineralization. SRK will be retained to develop an updated NI 43-101-compliant resource estimate in conjunction with the completion of the bankable study.

Sage and Gryphon are pleased to announce that a joint project team as defined by the option agreement will be established incorporating representatives of both companies including experts in mine construction and finance.

The option agreement (and related subscription agreement), which was detailed in Stockwatch news dated March 5, 2010, has been amended as follows:

1. The option expiry date as defined in the option agreement has been extended until June 30, 2011.
2. Sage's commitment to subscribe for units of Gryphon has been modified to allow a subscription of $200,000 (U.S.) by June 16, 2010, and a further subscription of $200,000 (U.S.) by Aug. 16, 2010, based on a subscription price equal to a 5-per-cent premium to the 30-day volume weighted average trading price preceding the subscription date, subject to Toronto Stock Exchange approval.

Nigel Lees, president and chief executive officer of Sage Gold, commented: "We are pleased to be moving forward in the development of the Borealis project in accordance with Sage's strategy to acquire resources with near-term production potential. In addition to the cash flow potential from the near-surface oxide portion of the deposit, the Borealis property has substantial upside in its deeper sulphide resources."

John Key, president and CEO of Gryphon Gold, commented: "We continue to be encouraged by moving to the next stage with Sage Gold. Gryphon plans to drill at Borealis allowing for the extension of the oxide resource in order to provide for the company's future growth."

The technical information in this press release was approved by Steven Craig, vice-president of exploration of Gryphon Gold, a qualified person as defined by National Instrument 43-101 of the Canadian Securities Administrators.

The Borealis property is described in a technical report dated Sept. 17, 2009, titled, "Prefeasibility study on the mineral resources of the Borealis gold project located in Mineral county, Nevada," prepared in accordance with National Instrument 43-101 of the Canadian Securities Administrators. This technical report describes the exploration history, geology and style of gold mineralization at the Borealis property. Disclosure in this press release of mineral resources is based on the technical report. Details of the quality or grade of each category of mineral resources and key assumptions, parameters and methods used to estimate the mineral resources are included in the technical reports. The technical report also includes a description of environmental and permitting matters.

This release as it relates to Gryphon was prepared by the management of Gryphon. This release as it relates to Sage was prepared by Sage management.

We seek Safe Harbor.