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Northern Lion GOLD CORP. (TSX - V: NL) - A True VMS Story Reborn by John Lee 10/31/2007 Northern Lion Gold Corp.
 The name of Northern Lion probably isn't new to you. I have owned the stock since 2005 and that is when I first met company President John Lando. I like face to face meetings, and John has always been patient enough to explain the full deal details in often long meetings with me. From 2004 up until early 2007, NL's focus had been on its Haveri project in Finland. Haveri is a complex gold system with limited past open pit gold production. NL had some success in drilling Haveri (27g/Au over 9 meters), but were never able to pin down the mother lode. In April, NL sold Haveri to Lappland Goldminers AB ("Lappland Goldminers"), a publicly--traded Swedish exploration company, for $10.46 million CDN, consisting of $5 million cash and 1,771,726 shares (the "Lappland Shares") of Lappland Goldminers, at a deemed price of approximately $3.08 CDN per share. The purchase price was equal to the amount NL's total investment in Finland. NL's Lappland shares are liquid, and today are worth about $5 million CAD. To understand why I like Portugal and why NL switched focus, we have to talk about Eurozinc (which is now part of the famous Lundin Mining Amex: LMC). Eurozinc bought the Neves-Corvo zinc development in the prolific Iberian Pyrite Belt in March 2004 for 128 million Euros in Portugal. Through systematic exploration and rapid expansion, in August 2006 Eurozinc combined with Lundin mining to form a $4 billion metal producing giant. The merger valued Eurozinc at over $1.5 billion.  Neves Corvo sat on the Portugese side of the Iberian Pyrite Belt ("IPB"), which stretches between Portugal and Spain and is comprised of Late Devonian to Middle Carboniferous sedimentary and volcanic rocks. The IPB is 250 km long by 25 to 70 km wide, and has been actively mined for over 2,000 years. Over 85 VMS deposits have been identified in the belt with a bulk tonnage in excess of 1.7 billion tonnes. Seven of the deposits are in excess of 100 million tonnes, which include some of the world's richest (e.g. Neves Corvo) and largest (e.g. Rio Tinto - 335 million tones and Aljustrel - more than 270 million tonnes) VMS deposits.  The IPB dwarfs the world's other large volcanic massive sulphide ("VMS") provinces, such as Canada's Abitibi Belt 478 Mt) and the Bathurst Camp (252 Mt), and Sweden's Skellefte District (161 Mt). While numerous deposits such as Rio Tinto have been discovered and put into production on the Spanish side of the pyrite belt, the Portuguese side of the belt remains vastly under explored due to lack of capital investment and previous bureaucracies. However, geology knows no boundaries and the border between Spain and Portugal reminded me of the border between Ontario and Manitoba. Great mines such as Red Lake were discovered in Ontario but few paid attention to Manitoba-side opportunities until recent activity by the likes of San Gold, HudBay and VMS Ventures.   The history of Rio Tinto, and particularly the recent success of Lundin Mining's Neves Corvo project demonstrate the magnitude of potential that lies within the under-explored Portuguese region of the Iberian Pyrite Belt. In a short period of time, Northern Lion has assembled an impressive package of land, (some 600 square kilometers) within two license blocks in highly-prospective areas of Portugal: Cercal, located in the Iberian Pyrite Belt, and Moura, located in central Portugal.  CERCAL: Northern Lion Gold has entered into an exploration contract with the Portuguese government to explore the 240.98 km2 Cercal Licence. The Cercal licence contains "VHMS" style gold-copper zinc-lead mineralization hosted by Paelozoic volcanic and sedimentary rocks of the Iberian Pyrite Belt (IPB). At present the only known deposit on the Cercal Licence is the Salgadinho Deposit discovered in the 1970's. This stockwork type gold copper mineralization hosts a NON Compliant 43-101 resource of 1.3M tonnes of 0.73g/t Au, 9.48g/t Ag, and 0.90% Cu, generated in 1983 by the Portuguese Government. In August 2006, Northern Lion Gold conducted a deep penetrating air borne VTEM survey over the Cercal license area. The result of the air borne survey yielded two areas of major interest. NL intends to drill on those targets in early 2008. MOURA: NL got notified of the final contract agreement in June defeating other bidders because of the comprehensive exploration plan John Lando carefully put forth. John went and checked out Moura in August and was mightily blown away by the old workings, previous drilling, and the amount of data obtained from Portuguese mining government body. The immediate and most striking target is the Preguica deposit, located on the east side of the licence, which was explored by diamond drilling (37 holes) and underground (two levels 40 metres and 80 metres below the surface) during the 1950s and 1960s by the Portuguese government and Compagnie Royalle Austrienne des Mines (formerly Union Miniere) ("Austrienne"). The previous work identified two mineralized lenses, each about 350 metres long by up to 100 metres in length, and, locally, reaching maximum widths in excess of 30 metres, over a horizontal distance of 800 metres. Mineralization is open at depth. Austrienne calculated a geological estimate for the deposit of 1 million tonnes averaging 8% zinc and 2% lead (this estimate predates National Instrument 43-101 ("NI 43-101") and was not prepared in accordance with its requirements). Potential for additional mineralization exists along strike to the northwest and southeast, and elsewhere within the Preguica anticline. A second occurrence, the Vila Ruiva deposit, is located approximately one kilometer to the southeast of Preguica. Recorded production was 12,694 tonnes, grading 4.2% zinc. Zinc values (to 3.14% over 1.5 metres) have been encountered in drill holes completed both down-dip and along strike.  NL plans an 8000 meters drill program on Moura and Cercal, and a rig is currently on the Preguica target, then will move on to Enfermarias. The results should become available in 6 to 8 weeks. A second drill rig is expected to arrive later in November. This will allow the Company to follow-up aggressively on initial drill results. Meet with John and you will understand why the Portuguese government chose to partner with NL. His patience and attention to detail is unparalleled, and the director list at NL is long and extensive: With $10 million in cash and securities, a $13 million market cap, and a chance to strike big in an elephant, prolific, proven zinc belt with active participation by the majors, NL fits perfectly into my exploration portfolio. Technically, the stock tested strong support at 200 DMA of 39 cents late October on very heavy volume, once 50 cent resistance level is over come, the stock could reach 75 cents in a hurry, then ultimately test the $1 target. Selling for merely THREE MILLION DOLLARS net of cash, NL is as low risk as one can get in the exploration league. John Lee
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