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

To: LaFayette555 who wrote (16903)	3/26/1999 8:08:00 AM
From: Gord Bolton	Read Replies (2) \| Respond to of 26850

President's Report to the Shareholders : On Behalf of the Board of Directors, I am pleased to report on the achievements and activities of Winspear Resources Ltd. during this past year and to present the audited financial statements for the fiscal year ended December 31, 1998. This past year marked the tenth anniversary since the Company listed on the Vancouver Stock Exchange and is certainly the most significant year to date in its history. As the Company's corporate objective of discovering an economic diamond deposit moved closer to fruition, several milestones have highlighted the last twelve months. The Company's primary focus continued on the Snap Lake area of the Camsell Lake Project as well as other exploration culminating in the acquisition of two new significant project areas both of which appear to be highly prospective for new diamond discoveries. At the onset of 1998, the Company elected to fund the entire $2.7 million exploration program at the Camsell Lake Project and this increased its ownership in this project to 67.7%. This major exploration program, consisting mainly of a 200 tonne mini-bulk sample and detailed drilling indicated significant economic potential of the NW Dyke at the Snap Lake area of the Camsell Lake Project. Results from two one hundred tonne kimberlite samples indicated an average grade of 1.14 carats/tonne with an average value of US$301/carat. These results represent the richest in situ values of a kimberlite ever reported anywhere in the world. Analyses of these samples indicated twenty-five diamonds weighing greater than one carat with the three largest diamonds weighing 6.04, 8.42 and 10.82 carats. These three stones contributed 75% of the value of a parcel of 1387 diamonds (greater than 1.2mm) from this bulk sample with the value of $US 83.26 / carat attributable to the remaining stones. The distribution of the values indicated that results from the Snap Lake kimberlite is expected from an occurrence with a significant population of large high-value gem diamonds. As a result of this bulk sample, a scoping study was carried out by MRDI Canada, a division of H.A. Simons Ltd., on the potential mineability of the NW Dyke. Results from this study indicated that the potential for a minimum 10-year mine life at 1,000 tonnes per day on a combined open pit and underground operation, could result in an internal rate of return of approximately 55%. A follow-up detailed drill program on the NW Dyke indicated a resource of 1.3 million tonnes, containing an open-pit resource of approximately 700,000 tonnes. Drilling to-date has suggested that the deposit that has been defined to date along strike for 1.3 km and down-dip at 2.2 km, remaining open with a consistent average true thickness of 2.5 metres. Results from caustic fusion carried out from this detailed drill program indicated normalized diamond abundance from drill core is approximately equal to or better than diamond results obtained from the mini-bulk sample. As well, results to date indicate dykes intersected by drilling on the south shore and the northeast arm of Snap Lake have similar values and potential. Drilling and bulk-sampling to date strongly suggest that Snap Lake area appears to be the source of a highly diamondiferous kimberlite system. WINSPEAR RESOURCES LTD. QUARTERLY REPORT - FORM 61 DECEMBER 31, 1998 SCHEDULE C: MANAGEMENT DISCUSSION (cont'd…..) Following the completion of the 1998 exploration program at Snap Lake, a total of $12.5 million has been spent as this Camsell Lake Property advances toward pre-feasibility. Winspear has contributed a total of $8 million on the project to-date and has been project Operator since its inception. A total of $12.4 million is being budgeted towards Snap Lake for the 1999 exploration and development program. A 6,000 tonne mini-bulk sample, 17,500-metre drill program and detailed environmental studies are the main components of this program. In addition to the Snap Lake program, Winspear commenced a very active till sampling and geophysical program over its Carat option and its 100% Hilltop properties resulting in the discovery of a number of significant targets being outlined for further exploration during 1999. A total of $2 million has been allocated for exploration in 1999 on these properties that will comprise further detailed geophysics, till sampling and drilling. During 1998, the Company saw its share price fluctuate from a low of $0.46 to close the year at a 52-week high of $4.85. Although the depressed junior resource market continued through 1998, Winspear was able to continue its exploration activities on a very high level. As a result of its high profile in 1998, Winspear traded in excess of 117 million shares on the Vancouver Stock Exchange, which comprised approximately 2.2% of the volume and, more importantly, 5.1% of the value of the shares trade on the Exchange. As the year came to an end, the Company closed a major financing of $10.6 million, one of the largest financings in the junior resource sector during 1998. The Company is in a very strong financial position as it continues its exploration and development activities in 1999. Efforts will mainly focus on the Snap Lake dyke as well as Hilltop and Carat properties and will continue to assess other diamond projects for the Company. With a total commitment of $12.0 million for diamond exploration for 1999, the upcoming year should prove to be very exciting. Winspear will continue its efforts towards exploration in the Northwest Territories, however other opportunities will also be evaluated. In closing, I would like to extend our sincere appreciation to our many loyal shareholders for their continuing and dedicated support. As well, I would like to extend a special thanks to our very dedicated exploration and administration team for their significant contribution toward the achievements by Winspear over the past year.