Article posted by ADI66 on SH board.Good article with the exception of the wrong ticker symbol.

December 07, 2011
By Chris Cann
Gold Bullion’s Maiden Resource At Granada Could Amount To A Couple Of Million Ounces When It Comes Out In The First Quarter Of Next Year
This year has held mixed fortunes for Toronto-listed Gold Bullion Development Corp (GBD). Encouraged by an increasing ground holding at its Granada gold project and by positive results from an earlier drilling campaign, the company upped the ante, promising a maiden resource by the end of the summer. Sadly, the consultants employed to produce that resource were unable to provide the necessary manpower, and the much anticipated resource failed to materialise.
But, with Christmas closing in GBD looks like it will finish off 2011 strongly, as news of another good-looking drill result from Granada has just been released. And, what’s more, the company has now appointed a new consultant that’s confident of delivering the sought-after resource. There should also be a preliminary economic assessment within the first quarter of 2012.

When the results from Phase III of GBD’s drill programme at Granada came in a couple of weeks ago, the company proudly declared that over the past two years it has sunk nearly 80 kilometres of drilling into the project. The net result of all that work, the company continued, was that the size of the originally established LONG Bars mineralised zone at Granada increased from a surface area of 600 metres by 300 metres to 1,500 metres by 750 metres. That’s a 600 per cent improvement.

At the same time, GBD released historic core from a step out hole that was drilled in 1990. The core was only partially sampled, and then discarded because of the low gold price at the time and has only just been re-sampled. This hole showed that mineralisation to the north of the current exploration focus extends to a depth of around 700 metres. What’s more, the hole ended in mineralisation.

The grades didn’t disappoint either, and included 1.12 grams per tonne over more than 300 metres, with a 23.55 metre interval grading 5.46 grams per tonne.

“It was a stunning hole”, GBD director Roger Thomas told Minesite. “This is probably one of the best news releases the company has ever had. The first thing is that it meets our expectations because we know the orebody down dips to the north, and so what we’re finding at surface at Granada we’d expect to find at depth further north. It’s probably the same type of material. At the northern border of our property we’ve already found high grade mineralisation at depth and this hole is right in between that area and the current focus.”

The new consultant, SGS Geosat, is now working on the best way to build these recent results into a resource and eventually a mine plan. Thomas describes SGS as “the best in the business”, so clearly expectations are high.

But then, SGS has been appointed following a frustrating summer period for GBD. “With the market itself and delays with our geological team, we didn’t come out with that resource as planned, which was the consultant’s timeline I might add, not ours,” Thomas said. “They were fantastic initially because they provided us with a massive mineralised structure, so we don’t have any qualms from that aspect. The problem was they just didn’t have the personnel on the ground to do all their duties.”

SGS has been employed to do everything from drilling to the preliminary economic assessment and will start with an analysis of a backlog of drill assays. Those assays will form the basis of GBD’s first resource in the New Year.

Though the consultant have only said that the resource will be out in the first quarter, investors are unlikely to have to wait until March 30th. And when the resource is released, they can expect something in order of between two to three million ounces.

Not all the drilling so far completed will be taken account of in this first estimate, because GBD has no intention of delaying this resource any longer than necessary, and the cut-off has to come somewhere. But, once all the drilling done to date has been considered, a second resource that ought to be significantly larger than the first is set to follow. That second resource should trail the first by only a couple of months.

The company has already completed a significant amount of infill work, which means that when that first resource is published a relatively high percentage of what’s reported should already be in the reserve category.

That’s partly what has allowed SGS to start thinking about feasibility work at this early stage. Granada is likely to be an open pit mine, but drilling in the New Year should deliver more ounces at depth and will start to give some indication whether or not the open pit operation can be converted into an underground operational in time - as has been the case with many other operations in the region.

GBD has a simple story to tell, but its ability to get the message out has been somewhat curtailed by the delay to its resource. Once that’s out of the way, and once a preliminary economic assessment can demonstrate the real value of the project, it’s a fair bet that investors will return to GBD with enthusiasm.
http://minesite.com/news/gold-bullions-maiden-resource-at-granada-could-amount-to-a-couple-of-million-ounces-when-it-comes-out-in-the-first-quarter-of-next-year