$Rig's Platinum Penny Alerts

[sweetpepperjam]

SAGD - .80 x .90 Shell -

Outstanding at November 3, 2010 = 214,611,890
Our Articles of Incorporation authorize the issuance of 450,000,000 shares of our common stock
Insiders own = 151,200,000 or 70.4%

0.90 550 OTO 11/26  
 0.90 550 OTO 11/26  
 t 0.795 10000 OTO 11/24  
 0.80 5000 OTO 11/24  
 0.80 5000 OTO 11/24  
 0.80 123 OTO 11/23  
 0.75 10000 OTO 11/23  
 0.71 7000 OTO 11/23  
 0.65 20000 OTO 11/19  
 0.60 7000 OTO 11/19  
 0.55 6500 OTO 11/18 

South American Gold Signs LOI to Acquire Colombian Gold Project

RICHMOND, INDIANA, Dec 22, 2010 (MARKETWIRE via COMTEX) -- South American Gold Corp. (OTCBB: SAGD) today announces that it has signed a non-binding Letter of Intent (LOI) to acquire Kata Enterprises, Inc. (Kata) the owner of the Narino Gold Project located in Colombia, South America.
South American Gold has signed a Letter of Intent to acquire up to one hundred percent of the shares of Kata which owns 85% of the Narino Gold Project which is located in the Narino Province of Colombia. The LOI contemplates, after an initial due diligence period, the signing of a definitive agreement in which an initial purchase of a twenty five percent interest in Kata for a cash payment of $1.5 million and two million shares of the Company's restricted common shares.

Under the terms of the Proposed Transaction, the Company would have the option to acquire the remaining seventy-five percent (75%) of the outstanding capital stock of Kata as follows:

-- It is contemplated that the Company would hold an option that it couldexercise to acquire an additional twenty-five percent (25%) of the outstanding capital stock of Kata, which would result in its acquisition
of an aggregate fifty percent (50%) of the outstanding capital stock of Kata, by paying on or before six months from the closing date of the Proposed Transaction an additional Two Million Five Hundred Thousand Dollars ($2,500,000) and issuing to the seller an additional Two Million (2,000,000) shares of the Company's Common Stock;
-- It is contemplated that the Company would hold an option that it could exercise to acquire an additional twenty-five percent (25%) of the outstanding capital stock of Kata, which would result in its acquisition of an aggregate seventy five percent (75%) of the outstanding capital stock of Kata, by paying on or before twelve months from the closing date of the Proposed Transaction an additional Two Million Five Hundred Thousand Dollars ($2,500,000) and issuing to the seller an additional Two Million (2,000,000) shares of the Company's Common Stock; and
-- It is contemplated that the Company could hold an option that it could exercise to acquire an additional twenty-five percent (25%) of the outstanding capital stock of Kata, which would result in its acquisition of an aggregate one hundred percent (100%) of the outstanding capital stock of Kata, by paying on or before eighteen months from the closing date of the Proposed Transaction an additional Two Million Five Hundred Thousand Dollars ($2,500,000) and issuing to the seller an additional
Two Million (2,000,000) shares of the Company's Common Stock.

Under the terms of the Proposed Transaction, the Company would pay an aggregate of Nine Million Dollars ($9,000,000) and issue Eight Million (8,000,000) shares of our Common Stock in order to acquire one hundred percent (100%) of the outstanding capital stock of Kata.

Further information on the transaction may be found in the Company's related 8-K filing with the SEC.

The proposed transaction is anticipated to occur on or about January 31, 2011 and is subject to certain conditions, including, but not limited to, the satisfactory completion of due diligence, the execution of a binding definitive agreement between the parties and the Company's ability to secure sufficient financing to close the proposed transaction.

Raymond De Motte, South America Gold's CEO commented, "Numerous foreign companies have in recent years entered the Colombian mining market as they have recognized the potential for mineral exploration, development and production in the country. We look forward to establishing and expanding our activities in Colombia."

About South American Gold (OTC: SAGD):

The Company's objective is to locate, explore and develop large scale commercially viable gold deposits primarily in Latin America. The Company focuses principally on geographic areas that are home to established gold deposits, including highly prospective districts with the potential to hold large deposits.

The acquisition of interests in exploration properties or implementation of exploration programs will require the Company to secure additional financing.

On behalf of the Board:

Raymond De Motte, CEO

South American Gold Corp. (SAGD.OB)