Ridley Corporation Ltd T.RIC

BMO research notes...

[Cousin_Gert]

"Richmont Mines Inc. and Mountain Lake Resources Inc. announced that the companies have retained Roscoe Postle Associates to review the drill database and create a 3-D model for the Valentine Lake project located in central Newfoundland. The companies expect that a new resource estimate, using a lowered cut-off grade, will result in a larger gold resource. An initial inferred resource of 1.3 million tonnes at a grade of 8.51 g/t gold (359,477 oz), estimated using a cut-off grade of 5.0 g/t gold, was announced in December 2004. Metallurgical testing for gold recoveries has also begun. Further regional exploration is planned, particularly to follow up on earlier drilling at Valentine East, located 13 km from the Valentine Lake zone." BMO also maintained a $5.55 target and out perform rating for RIC after the financial news release today... It needs to be noted that the write down is a non cash event...RIC has determind that the book value of East Amphi is too high based on the recoveralbe resouce in the ground...what they have done is recongnize this and reduce the depreciable base early rather that wait until the mining is through and write off the remaining undepreciated balance left at that time...this in effect will more truly represent the proper depreciation in go forward account periods(oit will reduce annual depreciation expense)...I wonder if some of this had to due with the announced changes in the management of the companies finance department also included in the NR...the new guy seems to be on the ball... C.Gert