Sage Gold Inc. announces that it has increased the size of its previously announced private placement from up to 5,000,000 flow-through units (the FT Units) at $0.15 per unit for gross proceeds of up to $750,000 (subject to an over-allotment option that would allow the issuer to sell additional CS Units for gross proceeds of up to one-third of the gross proceeds of the original offering) to up to 8,333,333 FT Units for gross proceeds of up to $1,250,000 (subject to an over-allotment option that would allow the issuer to sell additional FT Units for gross proceeds of up to one-third of the gross proceeds of the offering).

The first tranche of the private placement (which included sales of both FT Units and CS Units, defined below) closed on September 27, 2011. The details of the first tranche closing can be found in the Company's press release of September 28, 2011.

Each FT Unit is comprised of one common share of the Company (a Common Share) issued as a flow-through share under the Income Tax Act (Canada) and one-half of one warrant (an FT Warrant). Each whole FT Warrant is exercisable to purchase one non-flow through Common Share at a price of $0.20 per share for 24 months from the closing date.

The private placement of FT Units is being conducted concurrently with the private placement of up to 9,259,259 common share units (the CS Units) at $0.135 per unit for gross proceeds of up to $1,250,000 (subject to an over-allotment option that would allow the issuer to sell additional CS Units for gross proceeds of up to 25% of the gross proceeds of the original offering). (The size of the private placement of CS Units remains unchanged.) Each CS Unit is comprised of one Common Share and one-half of one warrant (a CS Warrant). Each whole CS Warrant is exercisable to purchase one non-flow through Common Share at a price of $0.185 per share for 24 months from the closing date.

The private placement is subject to the final acceptance of the TSX Venture Exchange (the Exchange). The Company has received conditional approval of the private placement from the Exchange.

The net proceeds of the private placement will be used to fund the Company's exploration and development of the Clavos mine in Timmins, Ontario and for general working capital.

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 mine 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 release was prepared by management of the Company who takes full responsibility for its contents.

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.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

FOR FURTHER INFORMATION PLEASE CONTACT:
Sage Gold Inc.
Nigel Lees
President and C.E.O.
416-204-3170
Fax: 416-260-2243(FAX)

        Sage Gold Inc.
Mike O'Brien
Communications Manager/Investor Relations
416-204-3170
Fax: 416-260-2243(FAX)
www.sagegoldinc.com

Source: Sage Gold Inc.