To use a baseball analogy, Gold Bullion Development (GBB, TSX-V) had a great day at the plate yesterday with a double high off the wall down the right field line and a triple into deep right centre field. A LONG home run could come very soon.

Gold Bullion’s news release yesterday was highly significant. It showed a strong degree of confidence from the company in how the 20,000 metre Phase 2 drill program is progressing at the Granada Gold Property in northwestern Quebec. Its tone was bullish and aggressive, suggesting GBB is expecting good results. Smart and experienced junior resource investors who understand something about geology and can “read between the lines” gobbled up Gold Bullion stock all the way to 57 cents yesterday with GBB closing up a nickel on 1.8 million shares. The news didn’t come out until about an hour-and-a-half after the opening bell, so today’s volume – especially now that investors have had a chance to digest this important release – is likely going to be even higher.

So what was so significant about Gold Bullion’s news release? The “triple” I referred to in the opening paragraph was GBB intersecting multiple zones of altered feldspar porphyry and some quartz veining throughout the Phase 1 east-northeast discovery area (plus some visible gold). This is big, as I’ll explain, and it takes Gold Bullion very close to home plate and in an excellent position to score.

The “double” I referred to down the right field line is the identification of a second LONG Bars Zone (LONG Bars Zone 2) 1.5 kilometres to the east. This now gives Gold Bullion three distinct and highly prospective targets for exploration and development:

1. The LONG Bars Zone east-northeast discovery area where we now know, based on yesterday’s news, that GR-10-17 was no fluke – Gold Bullion is hitting multiple favorable zones and mineralization could be widespread here;

2. A promising new area 1800 metres east of GR-10-17 that Gold Bullion has chosen to call “LONG Bars Zone 2?;

3. The LONG Bars Zone Preliminary Block Model which has a potential (non-compliant) resource of 2.4 to 2.6 million ounces of gold with the possibility of additional discoveries at depth.

Let’s now examine each of the above three targets in further detail based on the new information investors have received from Gold Bullion:

1. LONG Bars Zone East-Northeast Discovery Area

Phase 2 drilling has so far totaled 4,000 metres (17 holes) in this area which historically has been under-explored with only limited drilling. GENIVAR is attempting to confirm the extent of mineralization in this area after all five shallow Phase 1 holes returned encouraging results, especially GR-10-17 which intersected 1.21 g/t Au over 65.5 metres. What is highly significant in our view is the second sentence in paragraph two of GBB’s release:

“Drilling in this promising area…is consistently intersecting multiple zones of altered feldspar porphyry, favorable for gold mineralization, along with some quartz veining in all directions surrounding discovery hole GR-10-17. Visible gold has been observed in a few of the holes.” (emphasis is ours).

GENIVAR and Gold Bullion must be elated with this – they are consistently intersecting multiple zones of altered feldspar porphyry in every direction surrounding GR-10-17. Altered feldspar porphyry doesn’t always contain gold mineralization but often it does. It’s exactly the type of rock or zone, in this geological setting, that Gold Bullion wants to hit. And the fact they are consistently finding these zones so quickly in Phase 2 drilling is hugely important and strongly suggests that at least some of the holes in this area could turn out to be exceptionally good. As always, though, nothing is certain until the assays are in. But things are looking very encouraging.

In paragraph three, the news is equally interesting. Gold Bullion’s deepest hole yet (365 metres vertical depth) is about to be drilled (starting today or tomorrow) 176 metres east-southeast of GR-10-17. This target was chosen because of altered zones that were intersected in a hole 75 metres to the northwest of the planned deep hole, and in another hole 75 metres to the southwest. These three holes form a triangle with GR-10-17 nearly 180 metres to the west-northwest. If the deep hole hits significant mineralization, along with the other two, look out. Gold Bullion will light up like a Christmas tree as investors will begin to calculate some tonnage possibilities in this area with over 5,000 metres having been drilled (Phase 1 and Phase 2).

It will be interesting as well to see what kind of grades Gold Bullion can pull from 150 to 350 or more vertical metres depth in this area as none of the Phase 1 holes, as far as we know, went deeper than 150 metres vertical. On the one hand, mineralization in the east-northeast area and throughout the LONG Bars Zone appears to be widespread, near surface and low grade (conservatively, 1 to 1.2 g/t Au) – perfect for an open-pit operation. On the other hand, the nature of the Cadillac Trend is for grade to improve with depth. So what we’re saying is, there could be some surprises below 150 metres which can still be mined as an open-pit (very deep down, of course, there could be underground potential if grades are high enough).

It’s probably safe to assume based on the general thrust of the news release as well as the metres and number of holes drilled that GENIVAR has been “filling in the blanks” with its east-northeast drill plan so far. This means they’ve likely been drilling in a fairly concentrated area perhaps extending as much as 200 or 300 metres east of GR-10-17 and a few hundred metres south of the discovery hole. There’s not much room to the west before reaching the Preliminary Block Model (approximately 150 metres), and to the north they’ve obviously drilled some holes. Our best guess is that this drilled area now measures about 300 metres east-west and maybe as much as 400 metres north-south. There’s much more room, obviously, going east and that’s also where the strike of the rock will take the drilling. With at least 5,000 more metres left in Phase 2 for the east-northeast area, GENIVAR should be able to push out at least 200 more metres to the east which could make this area about the same size as the Preliminary Block Model which has a strike length of 600 metres.

2. LONG Bars Zone 2

Gold Bullion introduced a new and highly prospective geological target yesterday – LONG Bars Zone 2 which is 1800 metres east of GR-10-17 and features the 1 kilometre long Auk Shear Zone. GENIVAR continues to compile information on this area which, the news release states, “received considerable historical attention but was not viewed in the context of the new geological interpretation of Granada as a potential near-surface, bulk tonnage deposit amenable to open-pit mining…with similar geological characteristics to the original and current LONG Bars Zone, LONG Bars Zone 2 is a high priority exploration target for Gold Bullion and has the potential of significantly impacting both the scale and geometry of the overall mineralized system at Granada.“

Early last month BMR obtained a lengthy report from the Quebec Ministry of Mines (“Geology, Structure and Gold Mineralization, Granada Extension Property, 1994?) which was prepared for former Granada operator KWG Resources which was exploring the property in the 1980's and 1990's for individual, high grade quartz veins that could support underground mining. This report clearly outlines the significant potential of the “Aukeko Prospect” which Gold Bullion has decided to re-name LONG Bars Zone 2.

The 1994 report states that 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 Aukeko (LONG Bars Zone 2) which was historically tested by a 12-metre shaft, stripping, trenching and some limited diamond drilling with encouraging results. Sample assays in the 1930's returned grades as high as 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 this area, an historic showing known as the Bert Vein returned grades in excess of 200 g/t Au – “the average assay of three bulk samples was 7.00 oz Au/T (page 11 of the report).”

Gold Bullion’s release states, “Several northeasterly fault zones cross the shear zone and are considered prime targets for possible economic gold concentrations. Numerous vein zones, hosted by both Granada Formation conglomerate and feldspar porphyry, have been delineated historically in LONG Bars Zone 2 through trenching with considerable visible gold noted. The auriferous veins reportedly widen with depth and occur in an east-west trending zone measuring at least 1200 metres in length and 200 metres in width.“

LONG Bars Zone 2 really helps to underscore the blue sky potential of Gold Bullion. The same geological features and structures observed so far within the Preliminary Block Model and the east-northeast discovery area carry on for at least 3,000 metres east of GR-10-17. To put things in perspective, the distance from Pit #1, at the western edge of the Preliminary Block Model, to GR-10-17 is 600 metres. GENIVAR and Gold Bullion are potentially looking at an absolutely massive amount of drilling going east – well in excess of 100,000 metres. By then, how big may this deposit be?

3. Preliminary Block Model

Infill drilling at 30-metre spacing continues within the Preliminary Block Model which has a potential (non-compliant) resource of 2.4 to 2.6 million ounces. This figure represents a defined area with a strike length of 600 metres, a width of 500 metres at an angle of 50 degrees from horizontal, and an average true thickness of 70 metres. The potential resource is derived from an average of 55 million tonnes (using a 40 to 100 metre true thickness gives 30 to 80 million tonnes respectively) of potential gold mineralization at a specific gravity of 2.65 tonnes per cubic metre grading 1.38 g/t Au to 1.46 g/t Au (a 15% dilution factor was applied to the bulk sample grade of 1.62 g/t Au and a weighted bulk sample/waste pile grade of 1.72 g/t Au).

Infill and definition drilling within the Preliminary Block Model will eventually lead to a 43-101 compliant resource, but yesterday’s release stated that exploratory drilling is also taking place. It’s very important to point out that almost all the drilling historically in this area, as well as just recently and currently by Gold Bullion, has been very shallow (less than 100 metres vertical depth). The Preliminary Block Model resource potential that has been outlined is based on nearly 500 drill holes, underground workings and Gold Bullion’s 30,000 tonne 2007 surface bulk sample. The possibilities at depth are very significant and could considerably expand the estimated potential resource of 2.4 to 2.6 million ounces.

Conclusion

Investors got the first real indication of the blue sky potential of Granada March 1 when Gold Bullion issued a series of drill results that included GR-10-17, and also stated that a “prominent zone of deformation, hyrdothermal alteration and quartz veining extends for at least five kilometres around the old mine workings.“ That blue sky potential is so far being proven out as we now know there are likely more good results coming from the east-northeast discovery area. And the company now has a second LONG Bars Zone to explore that has a very similar geological signature to the first LONG Bars Zone. Granada is a different type of creature than Osisko’s massive Canadian Malartic Deposit 65 kilometres to the east that contains 10+ million ounces, but there’s no reason Granada could not potentially challenge Canadian Malartic in terms of size. Both companies, Gold Bullion and Osisko, have taken a fresh and successful approach to former producing properties in one of the world’s most prolific mining areas.

In just seven months (Gold Bullion was sitting at just seven cents last December when we brought it to the attention of BMR readers) Granada has developed into a fascinating geological story. How this story unfolds over the next seven months should be incredible to watch.