Synopsis: In Express 2007-08 issued on October 24, 2007 I tried to explain why Richard Nemis may think Noront's nickel-copper-PGM discovery is "bigger than Voisey's Bay" by pointing out a couple geophysical survey maps that show a coincident MAG/EM anomaly with a 2,000 metre strike that is offset a couple hundred metres to the southeast of the MAG/EM conductor that has yielded the high grade Noront discovery. The speculation in some corners of the market is that these two anomalies represent the same sulphide body, which, if true, signals a tonnage footprint that justifies speculative comparison to Voisey's Bay. However, I have since heard from other quarters that the anomalies highlighted by this ground geophysical survey done on 200 metre line spacing are not reliable for technical reasons that I do not understand. It has been suggested that the magnetic and electromagnetic anomalies indicated by an airborne survey flown in 2003 on 300 metre spacing is more reliable. Last week Fancamp Exploration Ltd (FNC-V: $1.85) published a news release which included maps of the MAG and EM interpretations done by Scott Hogg for the airborne survey data of 2003. According to Fancamp's Peter Smith the 300 metre airborne survey data is much more reliable than the 200 metre ground survey, which is why all the juniors in the vicinity of the Noront discovery are participating in an airborne survey being flown at 100 metre spacing. Peter Smith has good reason to hope that he is right about the 300 metre airborne survey, for it seems to suggest that if there is an octopus connected to the high grade tentacle Noront has discovered on its ground, that octopus body is located on Fancamp's ground to the southeast. I had not recommended Fancamp because its claim block at 1,036 ha is small, the property had been previously drilled by Probe Mines Ltd without success, and the Noront discovery appeared to be striking southwest safely past Fancamp's property whose corner is estimated to be about 150-200 metres southeast of the discovery zone. But after reviewing the geophysical data and exploration history with Peter Smith, and considering that I have already recommended every key McFauld's Lake junior except Noront, Spider and KWG whose implied project values are simply too high based on what we so far know, I have decided that Fancamp Exploration Ltd (FNC-V: $1.85) is a Good Absolute Spec Value Buy at $1.85. This recommendation is "Absolute" rather than "Relative" because unlike all the other McFauld's Lake juniors whose upside potential is linked to either making a similar discovery or benefiting from Great Canadian Area Play madness, Fancamp may not only have part of Noront's nickel-copper-PGM magmatic sulphide system, but it may have the bigger part.

have annotated Fancamp's geophysical maps below to help explain the potential as Peter Smith sees it. First of all, I need to point out that the Fancamp claim block is not properly located relative to the geophysical survey lines. According to Peter Smith the claim block is about 150 metres too far north; others suggest perhaps 200 metres. I have added a horizontal dashed line to show roughly how far southwards Fancamp's claims need to be shifted. For scale be aware that the northwest-southeast oriented aurborne survey lines are 300 metres apart. All the ground to the west and southwest is held by Noront. Fancamp rocketed to a high of $2.91 on September 17 during Noront's trading halt shortly after the junior discovered that these claims had not lapsed as written in its quarterly report. In January 2006 Fancamp had optioned its claims to Probe Mines Ltd (PRB-V: $0.84) on incredibly lousy terms that gave Probe 100% in exchange for $100,000 exploration and 200,000 shares over 2 years. Probe only drilled one hole on a Max-Min geophysical target several kilometres east of the Noront discovery before dropping the option in early 2007 rather than issue another block of stock. Fancamp wrote the property off, but Probe had filed assessment work which keep the claims alive until April 2008.

Probe ignored the coincident MAG/EM anomaly in the southwestern corner of the Fancamp property, presumably because it was interpreted as graphite. As an aside, I've been told that although everybody had assumed that EM conductors within magnetic rocks represented graphite, nobody has apparently intersected graphite in the McFauld's Lake region. Instead, thin sulphide bands have been encountered in the few cases when EM anomalies associated with a magnetic high have been drilled. Now these EM/MAG anomalies are being interpreted as pyrrhotite, the magnetic iron based sulphide associated with magmatic nickel-copper sulphide deposits. In any case, the diagram clearly shows that an EM conductor coincides with a magnetic high near the Noront discovery close to the Fancamp claim boundary. What the diagram does not distinctly show is the southwards jog of Noront's conductor as depicted in the 200 metre ground geophysical survey. Instead, there appears to be a cluster of EM conductors in the southwest corner of the Fancamp claim, which coincides with a magnetic high. What Peter Smith finds intriguing about his magnetic anomaly is the "stubbiness" at its northeastern limit, which Smith speculates might signal a fault offset from the Noront discovery anomaly. In fact, a geophysicist had apparently interpreted the EM cluster coinciding with the "truncated" magnetic high as a flat lying sulphide body covering 500 m by 300 m. Smith is inclined to see Noront's pipe shaped discovery as indicative of a feeder dyke related to his anomaly which he prefers to view as an ovoid style embayment.

Conclusion: Only drilling will establish what Fancamp's anomaly does actually represent. But if you were to ask where Noront's Richard Nemis would likely find the tonnage to justify his "bigger than Voisey's Bay" prediction based on this geophysical data, one would have to answer "on Fancamp's property". Although Nemis apparently made no effort during the first few weeks after Noront's "visually significant" core was pulled in late August to contact Fancamp and option this ground, he apparently has now been on Peter Smith's case to do a deal. No deal, however, is likely to happen until Fancamp interprets the 100 metre spaced airborne survey data and pokes a few holes into the ground, for Pat Sheridan Sr owns 20% of Fancamp's stock. Fancamp has 27,560,981 shares fully diluted, about $1 million working capital, and a 100% interest in its McFauld's Lake property. The implied project value at $1.85 is only $51 million, which is very cheap compared to the $825 million IPV of Noront's discovery next door. Fancamp should be in a position to drill its targets by early 2008. There is a good chance Fancamp will find something similar to Noront's discovery, and if this were achieved, pricing parity between Noront and Fancamp at Noront's current valuation would put Fancamp into the $20-$30 range. Fancamp is a very high risk speculation, but the reward potential offered by its geophysical data supported closeology is also very high. Fancamp also represents a good long position hedge for those inclined to go short Noront, because if that Noront short goes bad in a big way, it will most likely be because the discovery is part of a much larger system associated with the EM/MAG anomaly on Fancamp's ground. Another strategy would be for a Noront shareholder to switch out of Noront into Fancamp, for if Noront delivers news that drives a doubling of its price, the impact on Fancamp will be more than a double.