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Gold/Mining/Energy : Winspear Resources -- Ignore unavailable to you. Want to Upgrade?

To: Patrick Laflamm who wrote (9702)	11/25/1998 1:00:00 PM
From: John Stella	Respond to of 26850

This might be of interest to you. Comments made by Merrill Lynch in a report dated June 1998 - Canadian diamonds generating a lot of interest The discovery of kimberlite pipes in the Northwest Territories of Canada in the early 1990s led to the largest exploration boom this century. It generated more interest than the gold rush in the Carlin Trend in the U.S. Initial estimates of future diamond production from this new field had even the most sceptical observers and geologists on the retreat. During 1996 and 1997, 40 to 50 companies were involved in active diamond exploration, 75% of them junior companies. Fortunately for the diamond industry, these highly optimistic forecasts were not to materialise. To date, the success rate of discovering new economic deposits in the Northwest Territories has been much in line with what DeBeers had forecast- around 5% of the pipes would have diamonds, of which only a few would be economically viable. Consequently, forecast diamond production from this area has declined quite dramatically over the past two years. Most of the pipes which are likely to come into production are relatively small and are unlikely to pose a major threat to future supply over the long term. - Outlook for Production If the diamond market continues to grow at recent historical levels, Canada will provide a welcome source of gem quality diamonds to replace declining Russian gem production. The CSO has stated that Canada could eventually produce around 10% of global diamond production. Copyright 1998 Merrill Lynch, Pierce, Fenner & Smith Limited From the EQUITY RESEARCH report dated February 1998 - Canadian Diamond Companies...A Fledgling industry set to take off ¨Other conclusions we reach in this report include a bullish view on diamond economics. We see production as relatively flat going forward, with new production from Canada replacing lost production in some of the mature diamond-producing areas such as Australia and Russia. Our work on a comparison of the diamond field in the Northwest Territories with other classic diamond fields around the world suggests that the Northwest Territories are host to some of the world‘s richest diamond pipes, which bodes well for the profitability of the mines proposed for startup over the next few years.¨ Regards, John Stella Investor Relations Nora Exploration Inc.