Gold Canyon Resources Inc.
TSX VENTURE : GCU
PINKSHEETS : GDCRF

Gold Canyon Resources Inc.

May 24, 2012 08:30 ET

Gold Canyon Intersects 319 Meters at 1.02 Grams Per Tonne Gold; Four Barge Drills Operating

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 24, 2012) - Gold Canyon Resources Inc. (TSX VENTURE:GCU)(PINKSHEETS:GDCRF) ("Gold Canyon" or "the Company") is pleased to announce additional drill results from its 100% controlled Springpole Gold Project, located 110 kilometers northeast of the Red Lake Mining Camp, Ontario, Canada. Diamond drill hole SP12-128 intersected 319 meters at 1.02 grams per tonne gold (1,046 feet at 0.030 oz per ton gold). This hole is situated on the 0+050 meter section and is a 75-meter step-back from previously announced drill hole SP12-122 (330 meters at 1.58 grams per tonne gold announced in a news release dated May 2, 2012).

To view the Springpole Plan Map, please visit the following link: http://media3.marketwire.com/docs/gcu524i.pdf.

Since the commencement of barge drilling announced on May 2, 2012, Gold Canyon has launched four barge drills. Three of the drills are exploring areas along the southeast strike of the Portage Zone down to the 0-650 meter section line, and one is infill drilling.

"We currently have four barge drills in operation," comments Dr. Quinton Hennigh, technical advisor to, and director of, Gold Canyon. "Our plan is to aggressively explore areas along the southeast strike of the Portage Zone in an attempt to grow the deposit, as well as follow up with infill drilling in areas in need of more data. Hole SP12-128, for example, demonstrates good continuity of mineralization on the 0+050 meter section line down to a depth of 400 meters below surface."

  • Diamond drill hole SP12-128 was drilled on the 0+050 meter section line at an azimuth of 220 degrees true north and an inclination of -45 degrees. This hole is a 75-meter step-back from previously announced drill hole SP12-122 and tested deeper parts of the Portage Zone intersecting 319 meters at 1.02 grams per tonne gold (1,046 feet at 0.030 oz per ton gold). Given the Portage Zone dips at about 78 degrees northeast, this intercept represents a true width of approximately 267 meters. It also indicates this zone extends to depths of at least 400 meters on this section.
  • Diamond drill hole SP12-127 was drilled on the 0+600 meter section line at an azimuth of 220 degrees true north and an inclination of -45 degrees. This hole encountered multiple low-grade gold intercepts (see table below) making up the Bridge Zone that connects the Portage and East Extension zones followed by an intercept of 147 meters at 1.14 grams per tonne gold (482 feet at 0.033 oz per ton gold) across the Portage Zone. This intercept represents a true width of approximately 123 meters on this section.
  • Three holes, SP12-125, SP12-126 and SP12-129, all on the 0+900 meter section and drilled at an azimuth of 220 degrees true north and an inclination of -45 degrees, tested areas between the Main and East Extension zones as well as below the Main Zone. Each hole encountered multiple narrow intervals of gold mineralization (see second table below). Portage style porphyry mineralization was not encountered in these three holes suggesting they fall in a gap between the top of the Portage Zone and base of the Main Zone on this section.
Summary of Drill Results from the Portage Zone; Holes SP12-127 and SP12-128
Hole From (meters ) To (meters ) Length (meters ) Gold (grams per tonne ) Length (feet ) Gold (oz per ton )
SP12-127 7.0 35.0 28.0 0.60 92 0.018
59.0 69.0 10.0 0.40 33 0.012
89.0 97.0 8.0 0.51 26 0.015
117.0 127.0 10.0 0.38 33 0.011
174.0 200.0 26.0 0.38 85 0.011
212.0 219.0 7.0 0.65 23 0.019
229.0 239.7 10.7 0.46 35 0.013
251.0 398.0 147.0 1.14 482 0.033
includes 295.0 335.0 40.0 2.42 131 0.071
SP12-128 230.0 549.0 319.0 1.02 1046 0.030
includes 265.0 290.0 25.0 1.62 82 0.047
Summary of Drill Results from between the Main and East Extension Zone; Holes SP12-125, SP12-126 and SP12-129
Hole From (meters ) To (meters ) Length (meters ) Gold (grams per tonne ) Length (feet ) Gold (oz per ton )
SP12-125 42.0 50.0 8.0 1.18 26 0.034
106.0 118.0 12.0 1.25 39 0.037
230.0 236.0 6.0 0.84 20 0.025
SP12-126 306.0 316.3 10.3 0.99 34 0.029
367.0 374.0 7.0 0.49 23 0.014
SP12-129 84.0 87.0 3.0 1.18 10 0.034
110.0 113.0 3.0 1.70 10 0.050
227.0 229.0 2.0 8.15 7 0.238
322.0 324.0 2.0 7.37 7 0.215
Weighted averages were used to calculate all reported intervals
Reported intervals apply a 0.2 gram per tonne gold (0.006 oz per ton gold) lower cutoff
Internal dilution within reported intervals does not exceed core lengths of 10 meters
Intervals of no recovery were given a gold grade of 0 in the weighted average calculations above
1 troy oz = 31.103 grams
Conversion factor grams per tonne to troy oz per short ton; g/t divided by 34.2857 or g/t multiplied by 0.0292
1 meter = 3.28 feet

Core was logged then split using diamond saws with one half sent for analyses and the other half stored for future reference. Quality control programs include the use of field and laboratory duplicates, standards, blanks, and internal and external check assaying. Certified sample standards were submitted with the normal sample stream. Gold and silver assays were completed by SGS Canada Inc. in Red Lake and Toronto, Ontario using a 30 gram charge, fire assay, with an ICP finish. For over limit assay results, initial assays in excess of 10.0 grams per tonne Au, a gravimetric finish is utilized.

Update on 2012 Diamond Drill Program

Four barge drills are now operating at Springpole. Three of the drills are exploring areas along the southeast strike of the Portage Zone down to the 0-650 meter section line, and one is infill drilling northwest of the 0+000 meter section line. To date, approximately 18,600 meters of drilling have been completed at Springpole in 2012. The Company expects a steady stream of drill results coming in over the remainder of 2012 and to be able to update the National Instrument 43-101 ("NI 43-101") compliant resource by early 2013.

About Springpole

Springpole is an alkaline intrusion hosting a gold system that represents a potentially new style of Canadian Archean Shield gold deposit. The Portage Zone is hosted by a trachytic porphyry intrusion displaying polyphase autolithic breccias that host gold mineralization. Other zones, including the East Extension and Main, consist of high-grade veins and pods hosted in diatreme breccias composed of intrusive and country rock fragments. These breccias surround the northwest and northern margins of the Portage Zone. The known mineralized zones underlie a total known area of about 4 square kilometers representing only about 15 percent of the greater alkaline intrusive complex which remains yet to be explored.
On February 27, 2012, Gold Canyon announced an updated NI 43-101 compliant resource estimate for Springpole, effective February 27, 2012, which included an indicated mineral resource of 1.22 million ounces gold and 4.82 million ounces silver and an inferred mineral resource of 2.45 million ounces gold and 11.58 million ounces silver (cut-off grade of 0.4 grams per tonne gold). Tonnage and grades were reported as 30.0 million metric tonnes at 1.26 grams per tonne gold and 5.0 grams per tonne silver for the indicated category, and 60.0 million metric tonnes at 1.27 grams per tonne gold and 6.0 grams per tonne silver for the inferred category. A technical report detailing this resource was filed by the Company on April 10, 2012 and is available through the Internet on the Canadian System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

Quinton Hennigh, Ph.D., P.Geo. is the Qualified Person pursuant to NI 43-101 responsible for, and has reviewed and approved, the technical information contained in this news release. Dr. Hennigh is acting as a technical adviser to, and a director of, Gold Canyon.

About Gold Canyon Resources Inc.:

Gold Canyon is engaged in the acquisition and exploration of mineral and precious metals properties. The Company controls a 100% interest in the Springpole Gold - Horseshoe Island Gold, Platinum, Palladium Project and Favourable Lake Poly-metallic property currently under option to Guyana Frontier Mining Corp. pursuant to an option and joint venture agreement entered into in December 2005 - all in the Red Lake Mining District of Ontario, Canada.

Through its wholly owned U.S. subsidiary, Gold Canyon Resources USA Inc., the Company controls a 100% interest in the Cordero Gallium Project situated in Humboldt County, Nevada, U.S.A.

Gold Canyon entered into a REE Joint Exploration Agreement with the Japan Oil, Gas and Metals National Corporation (JOGMEC) in January 2009.

Additional information can be found on the Company's website: www.goldcanyon.ca.

Akiko Levinson, President & Director

Cautionary Note Regarding Mineral Resources

Mineral resources that are not mineral reserves do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, sociopolitical, marketing, or other relevant issues. The quantity and grade of reported inferred resources in any estimation are uncertain in nature and there has been insufficient exploration to define these inferred resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.

Cautionary Note to U.S. Readers Regarding Estimates of Measured, Indicated and Inferred Resources

This news release uses the term "inferred resources." We advise U.S. investors that while this term is recognized and required by Canadian regulations, it is not recognized by the SEC. "Inferred resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an "inferred mineral resource" will ever be upgraded to a higher category. Under Canadian rules, estimates of "inferred mineral resources" may not form the basis of a feasibility study or prefeasibility studies, except in rare cases. The SEC normally only permits issuers to report mineralization that does not constitute "reserves" as in-place tonnage and grade without reference to unit measures. The term "contained gold ounces" used in this news release is not permitted under the rules of the SEC. U.S. investors are cautioned not to assume that any part or all of a measured, indicated or inferred resource exists or is economically or legally mineable.

Cautionary Note Regarding Forward Looking Statements

This news release contains statements that constitute "forward looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995 or "forward looking information" within the meaning of applicable Canadian provincial securities legislation (collectively, "forward-looking statements"). Forward-looking statements often, but not always, are identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect", "targeting" and "intend" and statements that an event or result "may", "will", "would", "should", "could", or "might" occur or be achieved and other similar expressions. Forward-looking statements in this news release include statements regarding the timing and nature of permitting studies, the timing and nature of infrastructure developments and construction, projections of future optimization, production timeline targets, the timing of negotiations with third parties, and the timing and nature of future exploration programs which are dependent on projections which may change as drilling continues, or if unexpected ground conditions are encountered. In addition, areas of exploration potential are identified which will require substantial drilling to determine whether or not they contain similar mineralization to areas which have been explored in more detail. The description of the extent of mineralized zones is not intended to imply that any economically mineable estimate of reserves or resources exists on any of Gold Canyon's projects.

The forward-looking statements that are contained in this news release are based on various assumptions and estimates by Gold Canyon and involve a number of risks and uncertainties. As a consequence, actual results might differ materially from results forecast or suggested in these forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors that may cause the actual results, performance or achievements of Gold Canyon to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause the actual results to differ include; risks relating to fluctuations in the price of gold; the inherently hazardous nature of mining-related activities; uncertainties concerning resource estimates; results of exploration, availability of capital and financing on acceptable terms, inability to obtain required regulatory approvals, unanticipated difficulties or costs in any rehabilitation which may be necessary, market conditions and general business, economic, competitive, political and social conditions. These statements are based on a number of assumptions, including assumptions regarding general market conditions, timing and receipt of regulatory approvals, the ability of Gold Canyon and other relevant parties to satisfy regulatory requirements, the availability of financing for proposed transactions and programs on reasonable terms and the ability of third-party service providers to deliver services in a timely manner. Although Gold Canyon has attempted to identify important factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements, there may be other factors which cause actual results to differ. Forward-looking statements contained herein are made as of the date of this news release and Gold Canyon disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.

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