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Press release from Marketwire

Gold Canyon Updates Springpole Resource

Wednesday, October 17, 2012

Gold Canyon Updates Springpole Resource09:56 EDT Wednesday, October 17, 2012VANCOUVER, BRITISH COLUMBIA--(Marketwire - Oct. 17, 2012) - Gold Canyon Resources Inc. (TSX VENTURE:GCU)(PINKSHEETS:GDCRF) ("Gold Canyon" or "the Company") is pleased to announce an updated National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101") compliant resource estimate, effective October 17, 2012, for its 100% controlled Springpole Gold Project, located 110 kilometers northeast of the Red Lake Mining Camp, Ontario, Canada. This resource estimate is an update to the NI 43-101 compliant resource estimate released on February 27, 2012 and includes an additional 36,000 meters of drilling. The 2012 Diamond Drill Program included infill and step-out drilling designed to increase resource ounces, upgrade resource classification and locate mineralized boundaries.Highlights:An updated indicated mineral resource of 128.2 million metric tonnes at an average grade of 1.07 grams gold and 5.7 grams silver per tonne for 4.41 million ounces of gold and 23.8 million ounces of silver. An updated inferred mineral resource of 25.7 million metric tonnes at an average grade of 0.83 grams gold and 3.2 grams silver per tonne for 0.69 million ounces of gold and 2.7 million ounces of silver."Our thanks go out to Gold Canyon's Springpole staff who flawlessly executed our 2012 drill program," comments Dr. Quinton Hennigh, Director of, and technical advisor to, Gold Canyon. "We have made a huge leap forward with this resource update. With the recent addition of Mr. Fierro to Gold Canyon's team, not only do we have a world class deposit, but a first class team to move it forward.""We are very pleased the 2012 drill program achieved its goals and objectives. The new resource estimate will be the foundation for a Preliminary Economic Assessment (PEA) to be completed in early 2013," states Troy J. Fierro, CEO and Director of Gold Canyon. "One of the primary attributes of the Springpole deposit is it maintains a majority of its ounces with increasing cut-off grades and we believe this provides flexibility in developing the deposit. 2013 will be an exciting year, as the Springpole Gold Project begins to take shape."The updated estimate is summarized below:ClassificationTonnageGold GradeSilver GradeGold ContainedSilver Contained(million metric tonnes)(grams per tonne)(grams per tonne)(million troy ounces)(million troy ounces)Indicated128. 1 troy ounce = 31.103 grams.(2) Cut-off grade of 0.4 grams per tonne gold.Additional indicated and inferred resource estimates were developed using various cut-off grades and they are presented in the following tables.Indicated ResourcesCutoff GradeTonnageGold GradeGold Contained(million metric tonnes)(grams per tonne)(million troy ounces)>1.0 gpt46.71.792.69>0.80 gpt65.91.533.24>0.60 gpt93.01.293.85>0.40 gpt128.21.074.41Inferred ResourcesCutoff GradeTonnageGold GradeGold Contained(million metric tonnes)(grams per tonne)(million troy ounces)>1.0 gpt5.21.660.28>0.80 gpt8.71.350.37>0.60 gpt15.11.070.52>0.40 gpt25.70.830.69The mineral resources were estimated using current Canadian Institute of Mining, Metallurgy and Petroleum (CIM) standards, definitions and guidelines. 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 this 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. Mineral resources were estimated on the basis of a gold price of US$1,400/oz and US$15/oz for silver, both considered reasonable economic assumptions by the modeller. In order to establish a reasonable prospect of economic extraction in an open pit context, the resources above were defined within an optimized pit shell with pit walls set at 45 degrees; and estimated recovery of 80% for gold and 60% for silver; and mining costs estimated at US$2.00/tonne, processing costs estimated at US$12.00/tonne and general and administrative costs estimated at US$2.00/tonne. The cut-off grade used of 0.4 grams gold and is considered to be an economically reasonable estimate of breakeven mining costs. Mineral resources were estimated by ordinary kriging using 3-D Gemcom block modelling software in 10 by 10 by 6 meter blocks. Grade estimates were based on capped, 3 meter composited assay data. Gold capping levels were set at 25 grams per tonne gold and 200 g/t for silver. Blocks were classified as indicated mineral resources if at least two drill holes and four composites were found within a 60 by 60 by 40 meter search ellipse. All other interpolated blocks within the optimized pit were classified as inferred mineral resource.This resource model includes mineralized material in the Main, East Extension and Portage zones spanning from geologic sections 0+1,500 m in the northwest to 0-150 m in the southeast. Along the axis of the Portage Zone, resource modelling includes mineralized material generally ranging from 340-440 meters below surface. The Company is preparing a NI 43-101 compliant technical report in respect of the updated resource estimate discussed in this news release and will file the technical report on SEDAR within 45 days of the date this news release was disseminated. Gold Canyon and SRK Consultants (Vancouver) have initiated work on a PEA. Completion of this PEA is expected by Q1/Q2 of 2013. A winter drilling program is anticipated to begin in January 2013. This program will include geotechnical drilling for pit slope stability, infill drilling in the Camp/Main and East Extension areas, and to test various targets around the Portage Zone. Upon completion of the PEA, it is expected additional infill drilling will be required during the summer. The Company expects to begin a Prefeasibility Study during the second half of 2013.Dr. Gilles Arseneau (Ph.D., P.Geo.), Associate Consultant with SRK Consulting (Canada) Inc., has prepared the Mineral Resource Estimate for the Springpole Gold Project, and is independent of Gold Canyon for purposes of NI 43-101. Dr. Quinton Hennigh (Ph.D., P.Geo.) is a technical adviser to, and Director of, Gold Canyon. Dr. Hennigh and Dr. Arseneau are the Qualified Persons pursuant to NI 43-101 responsible for, and have reviewed and approved, the technical information contained in this news release.About SpringpoleSpringpole 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 four square kilometers representing only about 15 percent of the greater alkaline intrusive complex which remains yet to be explored.Conference CallA conference call to discuss Gold Canyon and the resource estimate will be held at 1:00 P.M. (EST) on October 17, 2012. Investors are invited to participate by connecting to the call using one of the following dial-in numbers:Date:October 17, 2012Time:1:00 P.M. Eastern Standard TimeDial in Number:Local / International: 416-850-9144 orNorth American Toll-Free: 1-866-400-3310About 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 a minority interest in the 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.caTroy J. Fierro, CEO & Director 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.FOR FURTHER INFORMATION PLEASE CONTACT: (604) 682-3234 or Toll free: 1 (888) 242-3234Gold Canyon Resources Inc.(604) 682-0537 (FAX)info@goldcanyon.cawww.goldcanyon.caORLeo KarabelasGold Canyon Resources Inc.Investor Relations(416) 543-3120leo@frontlineir.comNeither 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.