Gold Canyon Resources Inc V.GCU

Bigger than OSK and DGC!!!

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Gold Canyon Resources (GCU-TSXV $2.36) Strong Buy (Speculative) Target $5.45 Market Cap (Basic): $240 million January 26 2012 SALES 416.955.0198 TRADING 416.955.0388

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More Positive Results Released - GCU Building Towards 7.5 Million Ounces Event Gold Canyon released assay results this morning from its Springpole Gold Project that continues to strongly support our estimate of 7 to 7.5 million ounce gold potential. The project is located 110 kilometres northeast of the Red Lake Mining District, Ontario. Highlights include (see map and cross section): SP11-106: 3.51 g/tonne gold over 127.5 metres, including 7.73 g/tonne gold over 50 metres SP11-107: 0.72 g/tonne gold over 130 metres The company has commenced its 50,000 metre, 2012 winter drill program. It has two rigs drilling from the northeast shore, testing the deeper parts of the portage zone and is waiting for sufficient ice buildup to commence drilling from the lake. 80% of the drilling will be focused on infill and step-out holes around the portage zone. The balance of the drilling will test new targets discovered through geophysical surveys. The company has stated that its resource estimate will be delayed. Discussion We view the results released today as very positive. The infill holes demonstrated consistent grade-thickness with previous results and are accretive in building towards our 7.0 to 7.5 million potential ounce estimate. We view the delay in the resource estimate as immaterial. Hole 106 was drilled at an angle and therefore does not exaggerate true width as much as previous vertical holes testing the same high grade chutes. The true thickness demonstrated we believe is very impressive. The results continue to show good continuity across the main part of the Portage zone. In addition to building strongly towards our 7.5 million potential ounce thesis these results could also likely lead to an uptick in the average grade from the 1.35 g/tonne currently to closer to 1.5 g/tonne. It is our belief that Springpole is quickly becoming one of Canada's top "low grade" deposits with grades at least 40% better than both Osisko's Canadian Malartic and Detour's Detour Lake projects. Drilling in the middle part of the Portage, along section 0+500 demonstrated good apparent continuity between sections. Hole -106 encountered grades higher than those demonstrated by hole -104 (1.66 g/tonne gold over 148 metres) which is 50 metres southeast, indicating a high grade chute. The high grade zone is averaging around 5 g/tonne with a true thickness of 20 to 25 metres and having at least 75 metres scale continuity both along strike and down-dip. Each 75m by 75m panel of high grade could contribute 54,000 ounces to the potential resource. We believe the Portage zone likely plays hosts to at least 10 of these panels or "chunks". These higher grade portions alone will likely contribute 500,000 to 700,000 ounces gold to the overall contained ounces within the mineralized envelope. This layout bodes very favourably for the future economics of the overall project. We continue to remain very bullish on the project and maintain our Strong Buy and $5.45 target price per share that is based on 7.1 million potential ounces and a $100 per potential ounce of gold in the ground multiple. We have only ascribed minimal upside thus far for strike extensions to the southeast and none for new target zones. Please see the full note for full list of disclosures. FM RESEARCH IS AVAILABLE THROUGH: CAPITAL IQ/THOMSON REUTERS/FACTSET/THEMARKETS.COM Fraser Mackenzie Limited is the trade name used to market its institutional equity services. Although the information contained in this report has been obtained from sources that Fraser Mackenzie Limited believes to be reliable, we do not in any way guarantee its accuracy, and as such, the information may be incomplete or condensed. This document is for your information only. Financial data and prices are indicative only. All opinions, conclusions, estimates and other information included in this report do not guarantee future events or performance, constitute our independent judgment and are subject to change without notice. Fraser Mackenzie Limited will furnish upon request publicly available information on which this report is based. Fraser Mackenzie Limited has accepted responsibility for the content of any research appearing on this document. Canadian clients wishing to effect transactions in any security discussed should do so through a qualified and registered salesperson of Fraser Mackenzie Limited. No recipient may pass on the information contained in this report to any other person without the prior written consent of Fraser Mackenzie Limited.

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