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Gold/Mining/Energy : Nuinsco Resources (NWI) -- Ignore unavailable to you. Want to Upgrade?

To: LABMAN who wrote (220)	1/23/1999 6:09:00 PM
From: Buckey	Read Replies (1) \| Respond to of 5821

Here is the story - Their site is slow and under the business section 1/23/99 By CHRIS FLANAGAN Business Editor A massive new nickel find, potentially of Voisey's Bay proportions, has been discovered in northwestern Quebec by a tiny company called Nuinsco Resources Inc. The company, which lists its head office as an Etobicoke, Ont. mall, watched its share price increase tenfold overnight with the release of assay results from a single drill hole. But this was no ordinary drill hole. Nickel concentrations as high as 10.8 per cent were measured over a 3.2 metre section near the bottom of the drill hole and a 19-metre section recorded 3.68 per cent nickel, the company stated in a press release. The bottom 37 metres ran 2.47 per cent nickel, which is similar to the nickel concentrations of the massive, 37-million tonne nickel ovoid at Voisey's Bay. The property, located about 120 kilometres northeast of Mattagami near the tip of James Bay, is 100 per cent held by Nuinsco. The geology is considered more similar to Sudbury than to northern Quebec's Raglan nickel deposit, said base metals analyst Ray Goldie, of St. James Securities in Toronto. If the economics of the discovery turn out to be similar to Voisey's Bay — a quantum leap in speculation has early juncture — it could prove disastrous for Inco and ultimately Newfoundland. Inco is already facing a possible $1-billion to $1.5-billion write-down of its problem-plagued Voisey's Bay asset as early as Feb. 10, the date the Western world's largest nickel producer releases its audited annual results. Bay Street analysts are almost unanimous in predicting a write-down at that time but Inco remains mum, as is its longstanding policy. Analyst David Kellar of Griffiths, McBurney and Partners said a $1-billion write-down would likely not be enough and Research Capital Corp.'s Manford Mallory said the market's already essentially written off Voisey's Bay. The market proved its point Oct. 16, 1997 when Franco-Nevada Mining Corp. bought 6.3 per cent of outstanding publicly traded VBN-class shares for only $50 million — a price that would put the market value of Voisey's Bay at less than $1 billion. Inco paid $4.3 billion for the project in 1995 and 1996. Adding to Inco's woes are three new major nickel projects expected to come on stream in Australia this year. If the new technology of those projects proves as effective as proponents predict, the already dismal world nickel price of $1.97 a pound could fall further. The Voisey's Bay project was dealt another blow last week when the environmental panel reviewing the company's environmental impact assessment stated it would require an additional 45 days to review the masses of material from public hearings, pushing back the release date to the end of March at the earliest. The delay, which would normally frustrate a potential developer, caused barely a ripple at Inco. “We're a little bit disappointed,” said Inco spokesman Jerry Rogers, “but looking at the explanation, it seems plausible.” Rogers said he couldn't say if the delay would threaten any development plans. Inco's talks with the province of Newfoundland have been stalled since Premier Brian Tobin walked away from the negotiating table last summer, demanding a commitment to a full smelter and refinery at Argentia before the province would consider a mining lease. Inco argues the plan no longer makes economic sense and has suspended all engineering work. If any new Canadian nickel project were to be fast-tracked and its development plans pushed ahead of Voisey's Bay's, it would further incense Inco shareholders and likely have a negative impact on mining investment in Newfoundland. And at least one analysts believes a new project in Quebec could easily overtake an existing one in Newfoundland. “The policital risk is lower than if this project had been discovered in a province without the history of a mine, such as Newfoundland,” St. James Securities' Ray Goldie said.