Doug Ashbury
Northern News Services

Yellowknife (Apr 17/00) - Aber Resources will file a damages claim against joint-venture partner Winspear Resources, Aber president Robert Gannicott said Thursday.

The move comes after a B.C. court determined Aber can retain its 32 per cent stake in the Camsell Lake joint-venture, which contains the Snap Lake diamond property.

Project operator Winspear claimed Aber failed to comply with exploration funding requirements, so Aber's share should be less.

The claim for damages could be over $50 million.

"We can't ignore something that is of value to our shareholders," Gannicott said, adding that Aber had planned to spin-off its interest in the Camsell Lake joint-venture.

"We had a prospectus filed," he said.

The multi-million dollar claim, which Gannicott said should be filed within the next few weeks, is linked to Winspear's stock price.

Since the planned spin-off, Winspear's stock price has dropped. Aber's 32 per cent ownership in the property was valued against Winspear's previously higher share price. The damage claim involves the difference between the two amounts.

Aber is no longer considering spinning off its stake in the Camsell Lake joint-venture, Gannicott said. Money from the move could have been used to help fund Aber's 40 per cent share of costs associated with its other diamond property, Diavik. But since the initial spin-off plan, Aber has built up a cash position of about $200 million.

Aber has enough funding to last to at least mid-2001, he adds. Aber's share of the 1999 Camsell Lake funding is $4 million. Its share this year will be about $12 million.

"We are in an enviable position, we have a significant chunk of one definite mine (40 per cent of Diavik) and one potential mine (32 per cent of the Camsell Lake joint-venture)."

Asked if going to court with Winspear has caused friction between the two companies, Gannicott said it is a problem but Aber did not start it.

In reasons for his judgement in favour of Aber -- released by Aber -- B.C. Supreme Court Justice Shaw determined, "It is evident that Winspear is endeavouring to take advantage of an alleged failure by Aber to give 30 days notice as required by ... the joint-venture agreement. However, as I have held, Winspear itself failed to give notice within 30 days. In my view it would be unconscionable to allow Winspear to benefit from Aber's alleged failure when Winspear committed the same error that it alleges against Aber."

The court also ruled it would be unjust to allow Winspear to appropriate Aber's interest because that would deprive Aber of the real objective of the contract -- the potential for future profits if the diamond property proves successful.

Aber was also awarded court costs.

Winspear may appeal the court decision. Randy Turner, the company's president, could not be reached Thursday for comment.