Gold Canyon boosts Cordero gallium resource (February 11, 2008)

Vancouver – An updated resource estimate on Gold Canyon Resources‘ (GCU-V, GDCRF-O) Cordero gallium project, located in north-central Nevada’s Humboldt County, shows a significant boost of the specialty metal.

The updated study tables 15 million tonnes of measured and indicated resource averaging 47.7 parts per million (ppm) gallium for about 714,000 contained kg. of the metal — more than doubling the previous tally from early-2006. A further 6.6 million inferred tonnes at 43.7 ppm gallium was also recently reviewed kicking in roughly 335,000 contained kg. gallium. The resource estimate uses a 30 ppm gallium cut-off grade.

Since its earlier estimate, Gold Canyon completed a further 81 reverse circulation (RC) drill holes totaling 5,745 metres enroute to its new resource. The project has seen a total of 163 RC holes (12,190 metres) on it — giving about a 30-metre drill density over the deposit area.

Situated on the southeast rim of the large McDermitt volcanic caldera, the Cordero project hosts gallium mineralization in Tertiary-aged andesitic and rhyolitic flows and tuffs that are iron-enriched and strongly clay-altered. Gallium was emplaced by epithermal hot springs activity and forms an envelope mostly along the hanging wall of the major northeast trending M fault and other parallel faults that likely served as the conduits for mineralizing fluids.

To date Gold Canyon has really only focused on the upper, near-surface oxidized zone with gallium mineralization. A deeper zone of sulphide-rich mineralization (primarily pyrite) was encountered in a few drill holes and found to contain similar concentrations of the metal. The project also contains rare earth elements.

The company touts Cordero as the largest primary gallium resource in North America. Most of the world’s gallium production comes as a byproduct from processing of bauxite ore in the aluminum process along with some from zinc production. A significant amount of the metal also comes from recycling.

Gallium has recently been priced around US$570 per kg.

About 95% of gallium produced is used in the electronics industry specifically in the production of semiconductors used in cell phones, high-efficiency photocells and solar panels, and in light emitting diodes.

Gallium is a soft magnetic metal at room temperature and melts at just 30 degrees Celsius but does not boil until 2,403 degrees Celsius.

Gold Canyon recently commenced a large diameter drill program at Cordero to extract a bulk sample for metallurgical testing the data from which will be incorporated into a pre-feasibility study.

In addition to Cordero, the company is also exploring its Springpole gold project near Red Lake in northwestern Ontario where it also has a few other project optioned out to other companies.

Based on its roughly 50-million shares outstanding, Gold Canyon posts a $25-million market capitalization at the recent 50-trading level. The stock has a 52-week trading range of 32-93.