Grande Portage Resources Ltd. (GPTRF)

[Mr. Zen]

.MORNING NOTES Michael A. Berry, Ph.D.

GRAND PORTAGE (GPG TSXV)
Yesterday George Nicholson, P. Geo. consulting geologist to Grande Portage Resources,
updated me on their progress. George is the geologist in charge of the exploration and
development of the company’s Merry Widow project near Port Hardy on Vancouver
Island. I visited the Merry Widow last November.
Merry Widow Mountain has been mined for the past 100 years. Initially very rich
magnetite (iron ore) was mined on top at the Merry Widow pit. In 1897 high grade
copper was discovered at the Old Sport Horizon on the eastern slope of the mountain.
The Merry Widow pit was mined for its iron ore content beginning in 1916. The massive
sulphide ore containing copper and other “contaminants” were left in place at the time.
Two large ore bodies on the property were mined during the period 1957 to 1973. First
was the Empire Development Merry Widow mine, which lay at surface elevation of
about 732 meters.

Far below this magnetite mine, along what is called the Old Sport Horizon,
Consolidated Mining and Smelting Company mined out a copper deposit with accessory
gold and silver values in the Benson Lake mine.
George Nicholson and his crew have been busy drilling near surface targets at the Merry
Widow “glory hole.” They should soon have tonnage and grade estimates of the copper,
cobalt, gold, silver and magnetite. The company notes on its web site
“the favorable host zone extends for 5km in length and down dip along the contact of
the Coast Copper stock for at least 770m, the potential for the presence of a really large
resource of gold bearing massive sulfide mineralization becomes plausible.”
The project update issued yesterday indicated the company is nearing a resource
estimate.
“Much of the main Merry Widow open pit near surface mineralization, amenable to
low cost open pit extraction, has been completed and initial estimates regarding
tonnage, grade and cut off values regarding gold-copper-cobalt-silver and magnetite
have been received by the Company.”
The company is planning near surface drilling on six additional, potentially high grade
targets – all of which I saw last November. They are the Raven (Copper Knob), Skyline,
Bluebird 1 & 2, Marten and Marten extension. (See the map below for location of these
targets.)
Yesterday the company reported that at the Marten zone near surface intersections
averaged 1.5 meters. Gold values ranged from nil to 4.4 g/t, copper from 0.1% to 1.34%
and magnetite iron from 4.42% to greater than 50% with many greater than 30%. Cobalt
values were sporadic from nil to 0.389%. The company expects to find larger intercepts
on the other near surface targets. The near term resource estimates will likely be small
but high grade. In 1992 Don Graham estimated the Raven and Merry Widow targets
alone, contained reserves of 7,000 tonnes of ore grading .38 ounces per tonne gold and
between 1.2% and 2% copper. I shall await the resource estimate next week with
interest, but there should be a million tonnes or more of resource in the GPG estimate
now that much more drilling has taken place. Thus, in my opinion the resource could be
worth $200 million at current market prices for copper, gold and cobalt.
The upside, in the case of Grande Portage, is that there are many targets to be explored,
the property has been a mine for over 100 years and Teck Cominco last mined the Old
Sport Horizon in the 1970s and then left when the price of base metals fell to low levels.
While this initial resource estimate will be small, it should be high grade. The key
Discovery elements for GPG are the fact that the Merry Widow and surrounding targets
can make GPG a near term (2 year) producer. The company is also a strategic acquirer
and is actively acquiring more property in the area.