Energold Drilling Reports Second Quarter 2012 Results

Energold Drilling Corp. (EGD: TSX.V) ("Energold" or "the Company") is pleased to announce year over year revenue growth for the second quarter of 2012 with consolidated record revenue of $32.7 million, representing an increase of 14.9% over the same period in 2011.

In the second quarter, the Mineral division drilled 114,900 meters while the Energy division drilled 88,800 meters. Mineral drilling activity decreased 26% as a result of a cautious drilling environment among junior miners which have been negatively impacted by weak capital market conditions, affecting their ability to raise capital to fund exploration programs. The Energy business reported revenue of $4.4 million resulting from the ongoing evolution of generating year round work compared with historically winter only programs. Manufacturing revenue increased 152% to $5.9 million over the comparable quarter in 2011 at $2.4 million. Energold recorded a net loss of $2.0 million compared to net earnings of $3.7 million in the second quarter of 2011.

"We are pleased to report our second quarter results as they are testaments that Energold continues to focus on delivering growth and generating shareholder value. Our recent acquisitions were successful in diversifying our revenue base from the currently cautious mineral sector and positioned the group for strong growth in the significantly larger drilling markets in energy and manufacturing. Looking forward, the demand for mineral drilling will persevere as senior producers continue to look for ore to replenish their reserves, and Energold remains their premier contractor with our advanced frontier drilling solutions. Further, the Company is well positioned to weather the current market environment and is in a strong position to take advantage of acquisition opportunities with its strong balance sheet consisting of $36.5 million in cash and over $93 million in working capital," said Fred Davidson, President & CEO of Energold.

Energold also owns 6.98 million shares in IMPACT Silver Corp.a TSX venture-listed Company under the symbol "IPT". Based on closing market prices at August 24 2012, the investment had a market value of $9.6 million, amounting to $2.7 million more than our carrying value.

Second Quarter Results Comparison ($CAD 000s except per-share amounts and meters drilled)

MINERAL DRILLING DIVISION

Meters drilled during the quarter decreased over the same comparable quarter in 2011 as a result of the cautious spending environment, especially in the junior mining sector as exploration in that segment of the marketplace is dependent on the ability to raise new capital. The division drilled 114,900 meters in the period, a decrease of 26% from the 155,300 meters drilled in 2011. Division revenue was $22.3 million, representing a 15% drop from the comparable period in 2011 of $26.0 million. Average revenue per meter increased to $194 in the second quarter 2012 compared to $168 in the same period last year. During the period, the Company began to actively reallocate unused capacity from some junior mining exploration clients over to major and intermediate producing clients in underserved markets where demand is still robust as a result of relatively strong commodity prices and their positive impact on cash flows.

Meters Drilled During the Quarter

At the end of June 2012, the Company had 128 mineral exploration rigs, with an additional five rigs on order, where two of which are track-mounted rigs for the West African market being built by Energold Manufacturing (Dando). This represents a fleet increase of 11.3% over the comparable quarter in 2011. As some client requirements have evolved into underground drilling exploration, Energold has innovated its surface rigs for underground use while keeping 90% of the same equipment and supplies which has contributed to continued efficient management of crew and inventory costs.

Mexico, the Caribbean, and Central America remain the strongest market for Energold with 45 rigs in the region and accounting for over 51% of the meters drilled for the second quarter of 2012. South America continues to be a strong market for Energold with 42 rigs allocated in the region and representing over 20% of the meters drilled during the quarter. This market is starting to grow again, although at a slow pace as it remains impacted by ongoing local, political and social issues.

In Africa, the Company has 38 rigs and more are expected to be moved to the area. The region accounted for 29% of the meters for Q2, representing an increase of 12% over the first quarter. The Company is continuing to seek new markets where infrastructure challenges, as well as social and environmental issues continue to create new opportunities for the Company including underserved regions of South East Asia, where the Company currently has two rigs and clients are quickly finding that the highly mobile S-style frontier rigs are very suitable.

ENERGY DRILLING DIVISION

Energold Energy, operating as Bertram, had a lower activity level in the second quarter with $4.4 million revenue due to seasonal factors in Alberta, in line with historical performance figures. The bulk of activity in the area tends to occur in the winter months in Canada which encompasses first and fourth quarter, offsetting the traditional peak quarters of the mineral division. Year to date, Energold Energy has generated revenue of $29.9 million with 74% of revenue coming from Canada and the remainder from the U.S., specifically Pennsylvania and Wisconsin.

Oil sands operations accounted for $0.8 million of the second quarter revenue and $16.9 million of year to date revenue, generated from three programs conducted on behalf of major operators. All work in the oil sands was completed at the end of the quarter and mostly shut down for the traditional spring break. A small amount of activity is expected to continue throughout the summer and then increasing into year-end.

Meters Drilled During the Quarter

MANUFACTURING DIVISION

Energold Manufacturing, operating as Dando, continued to increase its business orders globally, generating $5.9 million in revenue during the period with associated net earnings of $0.5 million as rigs were completed and delivered to customers. The Company is continuing its investments into sales and marketing efforts globally with strong demand coming from Latin America and Asia. This effort has already begun to positively impact the order book, currently totalling over C$3.8 million (at the time of press GB�1 = C$1.57), with demand for rigs and equipment remaining high at this time amidst and further inquiries of C$11.0-15.7 million in new sales.

2012 AND BEYOND

Over the last 18 months, Energold has focused on delivering growth within the mineral drilling division and balancing this growth with diversification into new areas of business. In doing so, the Company has been able to position itself for maximum leverage in stronger market conditions while also insulating the overall business from weaker conditions as they should arise.

MINERAL DIVISION

Certain markets have rebounded more quickly since 2008 and in the latter part of 2010 and 2011; the Company saw an increasing level of interest for its services in higher margin frontier drilling. As junior miners have typically dominated that segment of the market, their ability to raise capital to fund exploration programs has been difficult for most of 2012 due to challenging capital market conditions and therefore, management has actively reallocated some equipment to other customers and markets. We have more recently seen senior and intermediate mining companies begin working on frontier regions as well and as a result, we have started to re-allocate equipment from capital-constrained juniors to better funded, more mature mining customers in more active markets. This process however, does take time and should become more evident in our financial results going forward. Overall, management expects the division stay at levels experienced in 2011 until there is a positive direction in the market as a whole.

ENERGY DIVISION

The Company, via its acquisition of Bertram Drilling, continues to penetrate multi-billion dollar spending programs in the oil sands markets as was recently evidenced by the awarding of multi-year contracts (up to five years) with three major oil and gas companies in Western Canada worth at least $45 million starting in 2013. On an ongoing basis, the award of year round work is expected to substantially improve Bertram's ability to effectively manage the operations and improve its gross margins. The Energy division which is most active in late Q4 and especially in Q1 has helped lessen the impact of the mineral division which is most active in Q2 and Q3. We expect this trend to continue heading into 2013.

Bertram has also been active in pursuing both domestic and international clients to leverage its significant fleet of seismic drilling equipment. Management has begun to deploy equipment to more active and less competitive markets in a similar strategy to the mineral division that operates in 22 countries on five continents. In doing so, the division can earn higher margins and dramatically improve utilization rates. Currently, the Company has submitted bids for a number of locations in North America and the Middle East.

MANUFACTURING

Energold's Manufacturing division continues to work with both the Mineral and Energy divisions to develop and supply new, innovative equipment for use with Energold. Dando's history as a water well drilling manufacturer and operator uniquely allows management to develop a separate water well drilling services division for the Company. As well, Dando continues to provide equipment to mineral and geotechnical drilling companies throughout the world. The recent establishment of representatives in Indonesia and Australia has resulted in a much increased demand for large mineral exploration rigs for the coal mining sites in that region. Demand for water well rigs in sub-Saharan Africa has remained strong and the Company is responding to a number of tenders at this time, above and beyond existing contracts. Management believes it can further leverage existing relationships in Latin and North America to generate a good deal of interest from previously untapped geographical markets.

The Company will be reviewing its 2012 Second Quarter results via Conference Call at 1:30PM PST/ 4:30PM EST, Wednesday, August 29th. The dial-in numbers are 1-866-782-8903 (North American Toll-Free) and 647-426-1845 (Local/International). Management will be discussing the Company's financial and operational results ending with a question-and-answer period. Investors are encouraged to forward any questions they may have to info@energold.com prior to the conference call. The recorded audio file can be accessed at our website: http://www.energold.com/s/ConferenceCalls.asp by the following business day.

Energold Drilling Corp. is a leading global specialty drilling company that services the mining and energy, and manufacturing sectors in 22 countries globally. Specializing in a socially and environmentally sensitive approach to drilling, Energold provides a comprehensive range of drilling services from early stage exploration to mine site operations for both metals and energy in addition to its established drill rig manufacturer, Dando. Energold also holds 6.98 million shares of IMPACT Silver Corp., a profitable silver producer in Mexico.

On behalf of the Directors of Energold Drilling Corp.,


"Frederick W. Davidson"
President, CEO