by Richard Gleeson
Northern News Services

INUVIK (Apr 11/97) - The mystery of the biggest gravity anomaly in North America could move one step closer to being solved this week, according to those with the biggest stake in it.

This week Darnley Bay Resources Ltd. will be asking the Canadian Securities Commission for permission to start selling stocks to raise money for exploration of its stake in the Paulatuk area, said company president Leon LaPrairie.

The commission earlier rejected a prospectus filed by the Toronto company, calling upon it to raise between $1 million and $1.6 million to ensure those who have already invested in the project are protected.

A $340,000 payment owed the Inuvialuit Regional Corporation under a 1995 agreement will be made, as well.

Darnley Bay directors believe chances are good there are economically viable deposits of nickel, copper or platinum in the area.

Until the commission renders a decision on the filing, details of the prospectus cannot be revealed. In November LaPrairie told the Drum the initial asking price for shares will be $2 each.

Though he would not say what the asking price of the stock would be under the prospectus to be filed this week, Jim Emerson, who is handling financing of the exploratory work, noted: "We think the price we're offering it at is a fair market price. The only unknown we have is the impact of the Bre-X scare. We won't know that until we're sitting across the table from prospective shareholders."

Shares in Bre-X Minerals Ltd. took a nosedive two weeks ago with the release of drilling results for the Calgary-based company's stake in Indonesia. The report told of insignificant gold at the site, which had been touted by Bre-X geologists as one of the great gold finds in the world.

"That created a lot of uncertainty in the minds of people looking to invest in exploration projects," noted Emerson.

On the weekend th Globe and Mail reported that Bre-X's chief geologist made $35 million in legal trading of the company's shares.

Should the commission approve the sale of Darnley Bay shares, the timing of the Bre-X scandal will test the salesmanship of LaPrairie and others who will be promoting the stock during a cross-country tour that LaPrairie said will include stops in Hay River, Yellowknife and Inuvik.

"We hope to be on the road in two and a half weeks," said LaPrairie.

The gravity anomaly will be central to the pitch to stock brokers and prospective shareholders if the commission approves the offering.

Measuring very small differences, or anomalies, in the gravitational pull of the earth is one method exploration companies use to determine where to carry on more comprehensive exploration, namely drilling.

An increase in the pull of gravity in an area is an indication the rock beneath the surface has a higher density than surrounding rock, explained Warner Miles, aeromagnetic and gravity data base manager of the Geological Survey of Canada.

Miles emphasized that a gravity anomaly does not indicate anything of value is beneath the surface. "It's just one of a number of pieces of information exploration companies look at," he said. Miles added that surface formations, another clue exploration companies consider, are unremarkable at Darnley Bay.

"But it certainly is a remarkable anomaly," said Miles. He said when it was first measured, in 1967, the geologists thought their instruments needed recalibration. It was only after testing them on an area with unexceptional gravity, and returning to the site for a second reading that they accepted the existence of the anomaly.

The centre of the anomaly, where gravitational deviation is highest and exploratory drilling, if it happens, will likely begin, 13 kilometres south of Paulatuk.