Let's start this case by going back to the closest story that we can use for comparison: Voisey's Bay. When Diamond Fields was bought out for $146 per share, the biggest difference is that they had a share float of only 28M shares. Once fully diluted, we are looking at 161M shares for Noront. This will of course limit our upward aspirations. However, that $146 per share was equal to 4.1B for a resource estimate by INCO that ranged from 60 to 70M tons of ore grading something slightly less than ours, especially when you consider our other metals versus VBs other metal. But lets call it even on the grades even with the credit difference.

Now everyone speaks about infrastructure costs being prohibitive in the RoF. I believe a fair comparison would yield that our infrastucure costs would be lower then VB but I am willing to listen to anyone that can do a fair comparison of both.

In VB, they had some delays and costs related to poor dealings with the natives. Noront has been fair and forthright with the local populations and has involved them in the process. This should limit the costs down the road as surprises from this wild card should me minimal.

When INCO paid 4.1B dollars for 60-70M tons of ore grading about 2% nickel, the price of nickel was $3.00 per lb vs about a $12 average over the last 5 years for us, a 4X difference. This is a major factor that favors Noront.

So if we use the high end of INCO's estimate of 70M tons and divide that by the price difference, we need 17.5M tons of ore to have a similar value in the ground. The 4.1B paid for VB was viewed by many as being too much. If we reduce this to $3.2B dollars to be conservative than we have our scenario:

IF and that is still a big IF, we can prove 17.5M tons of ore grading 2% nickel, our buyout should be 3.2B or $20 per share.

Now the question is what are the odds of us getting to 17.5M tons of ore grading 2% nickel? That is a 2 part question: will the grade hold up and will we get to the tonnage that we need?

My belief is we will achieve both! The grade will be confirmed in the next NR. If the grade can stay close to 2% over the whole 437 meters, than we are home free on this part of the question. If our grade is + or - 0.5%, I believe we will make the case that our grade will be economical. If our grade over this HUGE intercept is over 2.5% than this would be fantastic news but not a realistic expectation. However if we do get numbers superior to this, watch the SP react violently upwards! If the grade is between 1-1.5% we will still be OK but this will dampen our momemtum and we will need higher grade on the next holes or we will need more tonnage. If the grade is below 1%, this will be a huge dissapointment and we will serious issues with our SP at that point. I do not think this will be the case but at this point, no one can be sure. Let's hope for 1.5% and up!!

The other question is tonnage. I continue to believe as most here do that Prof Mungall will be proven right. His theory was that it took a magma system kilometers in length to produce the up to 8% nickel we have hit at Eagle 1. It has taken us 1.5 years to hit something substantial enough to support his position but most of us have never stopped believing his theory and that is why we have followed the NOT story even when the stock was beaten down so hard.

Hole 49 was supposed to be a 1000 meter hole but was stopped at 946 meters because the hole collapsed. My geo friend's theory on this is that most likely, we were in massive sulfides at the time and that is why the hole collapsed. If that is correct and we already have 437 meters of mineralization and were still very open at depth, this lends a lot of support to tonnage. The other rumor that is interesting is that of a step out hole. Even a 100 meter step out hole would be very substantial for our tonnage. A substantial step out hole of 200 meters or more would almost guarantee that we will prove up 17.5M tons. VB never had intercepts as rich in nickel as we had yet they still ended up proving 131M tons of ore grading close to 2% nickel. When I think of all this and add it up, I cannot believe we will not reach 17.5M tons.

So this is why I belive we will have a SP that will hit $20 at some point. The things that stand in our way include: Difficulty in proving up tonnage, nickel prices falling back to previous lows, a hostile take over attempt. If we can avoid these issues, we will be home free.

Respectfully,

Glorieux