Dear Crowne Gold Clients;

Sean Trainor, President of Crowne Gold, Inc.  www.Crowne-Gold.com

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By Polly Yam and Robin Paxton
Reuters
Thursday, March 10, 2005

http://www.reuters.com/financeQuoteCompanyNewsArticle.jhtml?
duid=mtfh38666_2005-03-10_10-28-40_hkg302039_newsml

HONG KONG/SINGAPORE -- China Minmetals Corp. will scour the world
for raw materials to feed sizzling industrial growth at home but may
scale back its ambitions while metal prices remain at multi-year
highs.

China's biggest trading company has dropped a plan to buy Canadian
miner Noranda Inc., valued at nearly $6 billion, but an official for
the state-owned firm said on Thursday it may take a small stake in
its former target.

"We have revised the plan," said He Jianbo, chief of the president's
office at Beijing-based Minmetals.

"We have not ruled out taking a stake in the merged company."

Minmetals' bid for Noranda, Canada's biggest mining company in
sales, ended on Wednesday, when Noranda made a $2.5 billion stock-
swap bid for all the shares in subsidiary Falconbridge Ltd. it does
not already own.

Noranda is the world's third-largest zinc and eighth-largest copper
producer, while China consumes about one-fifth of global supply of
both metals.

Falconbridge is the world's No. 3 nickel producer.

Industry analysts in China said Minmetals would still secure the raw
materials it seeks by taking a stake in the merged
NorandaFalconbridge, which would have operations in 18 countries.

The Chinese trader did not have the experience or manpower to run
Noranda, they said, while copper prices that streaked to an all-time
high this week had helped push up the value of mining assets
worldwide, making Noranda a more expensive target.

A Shanghai-based researcher for Chinese fund Prime Capital
Management said: "Minmetals must have its own estimate in cost and
benefits. (Noranda's) assets may be overvalued now."

Since official talks began in September, copper has risen 20 percent
in value and zinc more than 40 percent as funds flocked to red-hot
commodities from lower-yielding bonds and equities.

"Minmetals had been a target of criticism for (considering)
purchasing at such a high price. Seven billion dollars is not small
money," said Heng Kun, an analyst at Everbright Securities in
Shanghai, referring to Noranda's approximate value in Canadian
dollars.

Minmetals -- which already has alumina assets in the United States
and is studying a nickel project in Cuba -- might now follow the
Japanese model of investment in overseas mining resources, by taking
a small stake in a larger company, he said.

"When the (raw) material price becomes more acceptable, you can
increase your stake gradually."

Jeco Corp. offers an example of the Japanese model. It is an
affiliate of Mitsubishi Corp.  with a 10 percent stake in Chile's
Escondida, the world's largest copper mine. BHP Billiton owns 57.5
percent and Rio Tinto, 30 percent.

Analysts said opposition within Canada to a state-owned Chinese
company acquiring key mining assets had also been a stumbling block
in the Noranda bid.

"China still wants to buy a stake ... it was the Canadian side that
didn't want Minmetals to buy the (full) stake," said an analyst for
an international bank, who asked not to be named.

Minmetals and Noranda were now studying a "strategic alliance", both
companies have said.

Minmetals' He did not comment on whether the company would submit a
bid for the shares owned by Brascan Corp., which will tender its
122.6 million shares, or about 41 percent of Noranda.

"They may want to buy a small part or have some type of offtake type
arrangements," Derek Pannell, Noranda's chief executive and the
probable CEO of the merged company, said on Wednesday.

The researcher at Prime Capital Management said Minmetals might
choose to play to its trading strengths by signing long-term
contracts with overseas mining companies to meet China's domestic
needs.

"It's a good thing," he said. "The fallout indicates Chinese
companies are more mature now in buying overseas assets."
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