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Gold/Mining/Energy : Winspear Resources

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To: Claude Cormier who wrote (18991)	5/3/1999 4:21:00 PM
From: Sudhir Khanna	Read Replies (1) of 26850

Claude, DHK was a completely different situation geologically and by other measurements. Why is WSP a good speculation? People: Experienced in the area, participated in the last private placement and own over 20% of the company. They have taken a long term view. Control: WSP is one of the few active NWT juniors that controls its own destiny - operates and controls a majority of the project. Incentive: Options and Warrants (most of which are controlled by the insiders) can bring in approximately $20 million. They need liquidity and higher prices for this to happen. Positioning: Has the sex appeal of large diamonds. The story is being watched by the majors and institutions who may enter the play once more information is known about the quality of the diamonds. The creation of Diamondex will remove uncertainty on the use of any funds and exploration risk leaving a clean vehicle for the Snap lake dyke. Tonnage: Drill after drill is intersecting kimberlite and these intersections are getting thicker. As a speculator, 20 million tonnes would not be a bad guess. Uniformity: Past results have indicated that the diamonds are distributed uniformly throughout the dyke. This is also expected due to the geological conditions. Grade: Size class distribution work, along with the above, gives a speculator reason to be optimistic regarding grade. Quality: Very little information available to date. This is the gap between the known and the unknown that makes this a speculation. Clear Exit Strategy: The diamond counts will be released prior to valuations. There is good reason to expect large stones. This will give many a chance to take profits again and speculate with free money on the valuations (if one desires to reduce their risk level). The Chart (I know you like charts): You will have to DRAW your own conclusions as they can be subjective. I see a higher base that has been building for the last few months. The Commodity: The market price for diamonds is improving. Wildcards: The source may be found. Interest in the property may increase. Sincerely, Sudhir Khanna, P.Eng.

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