New resource calculation for Gryphon Gold expected in March

“You know the old saying: the best place to find gold is in the head shaft of an old mine,” Tony Ker, president and chief executive of Gryphon Gold (GGN-T), told a group of investors at a recent Richmond Club luncheon in Toronto. “And people have found a lot of gold in Nevada.”

Some of that gold has come from Gryphon Gold’s very own Borealis property. Mined ore from eight open pits on the property, which operated from 1981 to 1990, contained 635,000 oz. gold, of which more than 600,000 oz. were recovered through heap-leach operations.

Gryphon began exploration work at Borealis in 2003. Last year it kicked off a 72-hole drilling program to the tune of about US$4.5-million.

Borealis hosts a measured and indicated resource of 37 million tonnes grading 1 gram gold per tonne (about 1.2 million contained ounces) plus 28 inferred tonnes of 0.7 gram gold (for about 609,000 contained ounces.)

A new National Instrument 43-101 resource calculation is expected at the end of March.

The Borealis gold project in western Nevada’s Walker Lane mineral belt is about 12 miles northeast of the state’s border with California and about 330 miles northwest of Las Vegas — or a two-hour drive south of Reno.

“All of our geologists have looked at this and said it’s one of the biggest volcanic-hosted systems they’ve seen in Nevada,” Ker said.

If Gryphon Gold moves Borealis into an open-pit, heap-leach operation, the company says it envisions mining from potential new pits as well as expanding existing pit areas.

In July, Gryphon enlarged its Nevada footprint after buying Nevada Eagle Resources, which gave it stakes in 54 separate gold projects. Of those new projects, 24 are, like Borealis, situated in Nevada’s Walker Lane trend.

Twenty-eight of the 54 new properties are leased out, Ker noted, earning the company about US$600,000 a year.

“I’m not going to say we’re Yanacocha but I’d say we’re the largest system of this type for a junior in Nevada,” Ker said, referring to Peru’s massive Yanacocha gold mine, the largest of its kind in Latin America.

Ker also noted that Nevada, with its pro-mining policies, is probably one of the best places to start a new mine.

The Vancouver-based junior has a market cap of C$45 million and 61.6 million outstanding shares. At the end of December Gryphon Gold held US$5.5 million in treasury bills and bank savings deposits.

In Toronto, shares of Gryphon Gold are trading at about 70 apiece.