From Rouyn-Noranda, Quebec:

The Quebec Ministry of Mines web site (link is provided at the end of this article) is a tremendously valuable resource for both companies and investors and we encourage our readers to use it as a tool in their research and due diligence. That’s exactly what we did recently and on Friday we received a treasure chest of historical information on Gold Bullion Development’s (GBB, TSX-V) Granada Gold Property eastern extension. What we’re sharing in this important article is publicly available information that anyone can access (for a price) through the Quebec Ministry of Mines – it just so happens that BullMarketRun, determined to perform all the proper due diligence it can for its many readers on this very exciting Gold Bullion exploration story, is the first to report on the document titled, “Geology, Structure and Gold Mineralization, Granada Extension Property, 1994.” The lengthy report with maps, which we are still reviewing, was prepared for KWG Resources which in the 1980’s and early-to-mid-1990’s was exploring Granada for individual, high grade quartz veins which could support underground mining. A couple of decades later, Gold Bullion’s approach to Granada is much different (it’s going after a low grade but very high tonnage open-pit deposit or series of deposits) because of new geological interpretations in addition to record high gold prices and new technology that allows this kind of mining operation to succeed economically.

It’s a safe bet that Gold Bullion and GENIVAR, its geological consultant, have additional information on the Granada eastern extension, including their own research, that no one is privy to. Company President and CEO Frank Basa told BMR in a recent interview that they will put out a news release on the eastern extension when “we have everything together”. What we’re about to do is give investors a “sneak preview” of the growing potential of the LONG Bars Zone based on the 1994 publicly available report cited above. It’s important to keep in mind that Gold Bullion’s estimate (non-43-101 compliant) of a potential resource of 2.4 to 2.6 million ounces within the Preliminary Block Model excludes the Phase 1 east-northeast discovery area and takes into account only about half of the total current strike length of the LONG Bars Zone. So the blue sky potential of Granada is not hype or the result of someone’s overworked imagination – it is very real and something investors need to factor in to their calculations when evaluating this company.

It’s no secret that the potential strike length of the LONG Bars Zone, most recently reported as 1,100 metres, could be huge. In fact, Gold Bullion’s March 1 news release stated, “A prominent zone of deformation, hydrothermal alteration and quartz-veining extends for at least five kilometres around the old mine workings.” The report we’ve accessed through the Quebec Ministry of Mines’ rich bank of documents begins to connect some dots and at least partially answers the following question: What exactly is out there going east beyond Discovery Hole GR-10-17, the easternmost hole drilled to date by Gold Bullion?

There is so much in the 1994 report that we’re still trying to work our way through but below are a few highlights for this article:

1. An east-west trending zone of shearing, alteration and quartz veining (with intrusions of syenitic feldspar porphyry) extends almost directly east of GR-10-17 to the “Aukeko Property” (a distance of approximately 2.2 kilometres) which was historically tested by a 12-metre shaft, stripping and trenching. Sample assays in the 1930’s returned grades as high 19 g/t Au while KWG got grab sample values as high as 13 g/t Au during some ground work in the summer of 1993. At the eastern end of Aukeko an historic showing known as the Bert Vein reportedly returned grades in excess of 22 g/t Au from three bulk samples in the 1930’s;

2. East of Aukeko (approximately another kilometre) is the “Austin-Rouyn Property” which in the 1930’s was tested by a shaft to 70 metres, 90 metres of lateral development and considerable trenching. The “Aus” vein occupies a shear which is exposed for some 270 metres. Grab samples as high as 200 g/t Au (6.5 ounces) were reported in 1940 while in 1946 channel sampling and a drill hole delivered some high grade results (up to 108 g/t Au) over narrow widths (less than 3 metres).

There is a great deal of material in the 1994 report that we are still reviewing. KWG completed detailed ground geophysics and geological mapping over the extension in 1993. They outlined a number of significant structures within a 500-metre wide zone that extends for several kilometres.

The bottom line is this: Aukeko and Austin-Rouyn are right on strike with the LONG Bars Zone and it’s safe to say that Gold Bullion’s drilling is going to make its way out to these promising areas. Investors shouldn’t get caught up in the historical numbers above but instead focus on the “big picture” which is the fact that the same geological features and structures observed so far within the Preliminary Block Model and the Phase 1 east-northeast discovery area seem to carry on for at least three kilometres further east.

The key for GBB is to follow this trend in a systematic fashion and deliver holes grading 1 g/t Au or better over wide intersections like some of their Phase 1 holes. If they can accomplish that, then yes indeed the Granada Gold Property and the LONG Bars Zone could prove up to be a massive deposit (or series of deposits) given the fact a potential resource of 2.4 to 2.6 million ounces has already been estimated in the relatively small defined area of the Preliminary Block Model. In addition, one cannot rule out the possibility, given the nature of the Abitibi region, of a base metal discovery over any part of Gold Bullion’s 5,000 hectare land package. The company has already made references to signs of copper and nickel mineralization at Granada through its previous bulk sampling and in a few holes that were tested for base metal mineralization in Phase 1.

The information contained in the publicly available 1994 report, plus whatever else GENIVAR and Gold Bullion have been able to collect, is going to be of immense value to GENIVAR as it plans a drilling strategy going further east of GR-10-17. The Preliminary Block Model is a great foundation for Gold Bullion. While mineralization is open in all directions at Granada, the immense exploration upside is clearly to the east where we now know there are highly prospective targets and quite possibly many more to discover and go after. Despite the historical work the eastern extension is still very under-explored.

Editor’s Note: Quebec Ministry of Mines – a valuable resource.