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Gold/Mining/Energy : SOUTHERNERA (t.SUF) -- Ignore unavailable to you. Want to Upgrade?

To: GEORGES who wrote (2968)	4/16/1999 2:08:00 PM
From: Claude Cormier	Read Replies (2) \| Respond to of 7235

I thought Angola was to risky for mining companies. Didn't SUF close their tewo otehr operations because of the guerilla?

To: GEORGES who wrote (2968)	4/17/1999 1:52:00 PM
From: VAUGHN	Read Replies (1) \| Respond to of 7235

Hello Georges Regarding your PM, I doubt it. SUF is a very reputable publicly traded firm. The numbers they reported on Camafuca are completely consistent with what had been previously established. My belief is that CJ is looking at the situation with a longer-term vision: 1. With minimal capital outlay, he can run and easily defend what will probably be essentially a large mechanical river dredge on the Camafuca's higher-grade ore at little operating cost per carat. He gets additional cash flow at minimal cost and risk which also helps defer SUF's dependency on DB's current control of Klipspringer's cash flow. 2. By honouring his commitment to the two adventurers (Sphere Trading) from whom he optioned the Camafuca and other Angolan properties, he is maintaining a business relationship that probably holds promise of future strategic acquisitions, possibly both within and beyond Angola. 3. As Peter suggested, by maintaining a presence in Angola and a partnership with the current government he maintains and cements that relationship, which I am sure he has indications, will bear fruit upon cessation of hostilities. 4. While the Camafuca is a very low-grade pipe, it probably does have significant potential to produce the occasional exceptional stone. It only takes one such stone such as the 20 carat pink found two years ago, to make a $20,000,000US difference in the bottom line. The diamond business is still very much an Old World business based on hand shakes, commitment, relationships and the word of gentlemen. CJ knows that better than most and he is very much a part of that establishment. The Klipspringer and Angolan properties were all secured through such relationships, not through SUF prospecting. CJ and SUF have developed a reputation as a man and a company of honour, which keeps its commitments and takes care of its friends. Those "connected" people; companies and government (officials) will turn our way again with future deals. The same can be said for the reputation SUF is building in the RSA and hopefully eventually in Brazil. The honest Canadian company that finds frozen assets, puts them into production quickly, employs locals in desperate need of wages and pays their taxes on time and to the letter. What a breath of fresh air that must be to the government, and how much they must be growing to appreciate that kind of commitment. All this will pay dividends in spades in the future. Now, if we can just generate some speculative Canadian excitement, we will all be a little more comfortable with these other commitments. Regards