Wellington West: Noront Kicks Off ‘10 Drill Program; 6 DrillsDelineating Eagle’s Nest & Regional Targets

• First 5 holes of ‘10 program, infill drilling reaffirms resource model.

Wtd avg grades are 2.5% Ni, 1.3% Cu, 1.2 g/t Pt, 3.8 g/t Pd; by contrast Indicated resource grades are 2.0% Ni, 0.95% Cu, 1.3 g/t Pt, 3.4 g/t Pd.

• Infill program aims to upgrade the resource ahead of Q2/11 feas.

3 of 5 holes (76, 76W1, 81) were drilled to trace the contact between the massive & disseminated zones - key step in development of the mine plan.

• Aggressive $39mm expl’n & engineering budget planned for 2010.

Six drills currently - bodes well for steady news flow. Budget breakdown - 33% regional, 30% engineering, 22% Eagle’s Nest, and 14% corporate.

• Maintain Buy rating and $2.50 target price.

Tgt based on 0.85x our NAV10% est. of $2.86/sh ($2.89 old). See NAV pot’l of $3.30/sh at 8% disc rate on project de-risking ie. feas + permits.

Investment Summary and Outlook

Building resources in a new Canadian mining camp. Noront Resources Ltd. is focused on growing a high-grade nickel-copper-PGE sulphide resource in the Eagle’s Nest deposit in the James Bay Lowlands of northern Ontario (the “Ring of Fire”). The company also has uncovered a related and potentially significant chromite district represented by (among others) the company’s high-grade Blackbird deposits discovered in early 2008. We contend that the high grades being encountered at Eagle’s Nest should help to overcome the logistical issues associated with the project’s situation in the James Bay Lowlands.

We use a discounted cash flow (DCF) analysis for Eagle’s Nest to arrive at a

12-month target price of $2.50. Our target is based on a 0.85x multiple of our NAV10% estimate of $2.86/share ($2.89/share old). The modest decrease in our NAV estimate is a result of incorporating the recently completed $13.8mm flowthrough offering (7.6 mm shares at $1.82/share).

Infill Drill Results Reaffirm Resource Model

First five holes of 2010 drill program supportive of geologic model.

Moreover, the weighted average grades of 2.48% Ni, 1.32% Cu, 1.23 g/t Pt, 3.77 g/t Pd and 0.25 g/t Au are generally in-line with those in the Indicated and Inferred resource categories. Three of the drill holes were drilled at oblique angles to the main mineralized structure (i.e. not true width) in an effort to test the continuity and extent of the interpreted massive sulphide mineralization at Eagles’ Nest. This is an important step in the development of the mine plan as the massive and disseminate mineralization is likely to be mined and processed separately.

Active 2010 Program Underway

Aggressive exploration and development budget of $38.7mm planned for 2010. The planned breakdown of expenditures includes $12.8mm for regional exploration, $8.5mm for Eagle’s Nest exploration (including $2.0mm for infill drilling and $6.5mm for deep drilling) and the balance slated for engineering and corporate expenses. While we view the initial 2010 drill data as a step in the right direction for resource and mine plan development, we note that the results generated from infill drilling are unlikely to drive material share price appreciation, particularly as the market waits for more clarity on development costs and transportation alternatives. That said, 2010 has the potential to be a news-filled year with nearly all of the company’s available cash balance earmarked for exploration and development initiatives.

Maintain Buy Rating and $2.50 Target

Valuation model remains unchanged. Our target is based on a 0.85x multiple of NAV10% of $2.86/share. As these results represent largely infill drilling, we await further step-out drilling and a subsequent resource update slated for H2/10 before potentially revising our production model for Eagle’s Nest.