THE $800 million takeover by the Barrick Gold Corporation, North America's biggest gold producer, of Arequipa Resources, a tiny, four-year-old Vancouver company with potentially rich deposits in Peru, is spurring renewed interest in Canada's plentiful supply of junior mining stocks.

The juniors enjoyed a lusty market play last spring in the wake of the phenomenal success stories of Diamond Fields Resources, since acquired by Inco Ltd., which a few years ago accidentally discovered mammoth reserves of nickel in Labrador, and Bre-X Minerals, which hit upon one of the world's largest gold mines in Busang, Borneo.

But the markets, as is typical, overreacted, and earlier this summer there was a sharp selloff in these issues. Barrick's announcement on July 11 that it would pay $27 a share for Arequipa -- whose stock through January had never risen much above $2 -- stunned the market and stirred the pot anew.

Even the $27 offer turned out to be insufficient. In response, Arequipa stepped up exploration activities at its Pierina open-pit mine in Peru, finding signs of still bigger deposits -- and held out for more money.