The gold is an inlay.  It is quite a process that includes raising little tits of metal and undercutting the edges.  The gold is then hammered into the prepared area.  

Sam Welch was in Alaska during the 70's when I was there.  He worked with a friend of mine at the FAA.  He is one of America's best engravers.  

Take a look at this video.  It shows the process for installing a gold inlay in an engraving.  It takes a little time to watch but is well worth it if you have any interest in engraving.  

The engraver is using an electric or air operated tool.

Frank