Gold Canyon tests high-grade targets at Springpole (May 15, 2006)

A winter drill program by Gold Canyon Resources (GCU-V, GDCRF-O) has returned bonanza grades from the Core area of the Springpole gold project in the Red Lake mining district of Ontario, while also returning encouraging values from a newly discovered zone in the 2.5-km long Southwest Target area.

The best result from the initial eight holes of the winter program was an 8-ft. interval grading 1.5 oz. gold per ton, which includes 3.2 ft. of 3.7 oz. gold. Other intervals from holes testing the Core area include 18 ft. of 0.63 oz. gold, 2.5 ft. of 0.88 oz., 2 ft. of 0.54 oz., and 12.2 ft. of 0.27 oz. gold.

A hole testing the East Extension zone at the Core area did not hit high-grade mineralization, but returned a 15.9-ft. interval averaging 0.065 oz. gold, starting at a depth of 344.1 ft.

Results from holes testing the Southwest Target area, situated more than 1 mile from the Core area, include 0.499 oz. gold over 3 ft., within a larger 12-ft. interval averaging 0.172 oz. gold. This target zone is one of several that had not been tested by previous programs.

The Springpole property was previously tested with 308 diamond-drill holes totalling 246,230 ft. More than $13 million was spent on the property since 1984, including a major program by Gold Canyon and a former partner aimed at finding bulk-tonnage gold deposits. While several zones contain low-grade historical inferred resources, Gold Canyon’s current focus is on outlining high-grade zones similar to those mined in the nearby Red Lake camp.

Gold Canyon planned to drill 27 holes totalling almost 10,000 ft. in the winter program, but a mild winter and heavy snows curtailed this to 21 holes. Results are pending from the remaining holes.

Gold Canyon is also developing its Cordero gallium project in Humboldt Cty., Nev. In late April, the company announced an independent resource estimate (compliant with National Instrument 43-101 standards) based on 82 drill holes. The project contains an indicated resource of 6.45 million tonnes of 52.3 ppm gallium, and inferred resources of 7.8 million tonnes at 49.2 ppm gallium.

Gallium sold for about US$500-US$600 per kg in 2005, with a kilogram of gallium roughly equal in price to an ounce of gold. Gold Canyon’s indicated resources host an estimated 337,360 kg gallium, and 384,640 kg in the inferred category.

The United States is the world’s second-largest gallium consumer (at about 21,000 kg per year), but is dependent on imports. Gallium is used in industrial and high-technology products, including cell-phones and satellite communications, and in biomedical products and services.