July 20, 1997

American Power Conversion (APCC on NASDAQ) West Kingston, RI, tel: (401) 789-5735. Price July 18/97: $22.87, 52-week range: $31.50-8.50. First mentioned at $12 on Oct 15/95 and last mentioned on Jan 15/97 at $29.50 as being fully priced, now at these levels once more attractive. This well established manufacturer of uninteruptible power supplies is still a growth company. 1997 earnings should come in at $1/sh. A return to the $30 mark is achievable over the next few months.

Benson Petroleum Ltd. (BEN on TSE), Calgary, AB, Tel: (403) 269-5158. Price July 18/97: $1.49, 52-week range: $1.60-0.81. First mentioned at $1.15 on March 14/97. Recently announced sale of some oil & gas interests for $5.5 million is a smart move to reduce bank debt. Company is expanding production in other areas and expects to participate in another 10 wells in addition to the 20 completed so far this year. BEN appears to be a well managed junior o&g growth company.

Birim Goldfields Inc. (BGI on TSE), Montreal, QC, Tel: (514) 393-8611. Price: July 18/97: $0.80, 52-week range: $2.50-0.50. First mentioned at $0.80 on Nov 15/95. Company recently announced major earn-in acquisition on a 7,000 sq.km. belt in Ghana, conducive to two types of gold deposits. Vendor, Newmont Gold, reserves the right to back in at feasibility stage. Meanwhile, partner Battle Mountain Gold is drilling on Birim's Dunkwa property. BGI has all the ingredients for success: 1) highly focussed, only gold, only one country:Ghana, 2) solid partners, 3) sufficient funds to carry out meaningful exploration.

Bonus Resource Services Corp (BOU on TSE, VSE), Calgary, AB. Tel: (403) 263-6777. Price: July 18/97: $5.10, 52-week range: $5.55-0.80. First mentioned at $0.76 on May 15/96. With the completed merger with Beta Well Service Inc, Bonus becomes the dominant company in the Canadian service rig business with a fleet of 125 well servicing rigs and 6 swabbing units. The next few quarters will tell how well the merger works. This newsletter's target of $7 remains intact.

Chai-Na-Ta Corp (CC on TSE, CCCF on NASDAQ), Langley, BC. Tel: (604) 533-8883. Price: July 18/97: $5.30. 52-week range: $13.60-5.05. First mentioned at $11.60 on Aug 28/95. Company farms ginseng root and is moving into downstream marketing. The wholesale market for ginseng has just about collapsed so that Chai-Na-Ta was wise to diversify vertically. But it's a long drawn out process: sales revenues and earnings have suffered, and so has the dismal performance of the stock. The company has recently established a strategic alliance with a Shanghai-based ginseng distributor, which may facilitate the diversification.

Ensign Resource Services Group (ESI on TSE), Calgary, AB. Tel: (403) 262-1361. Price: July 18/97: $35, 52-week range: $35-9.35. First mentioned at $8.50 on Feb 15/96. A strong company fully participating in the drilling contractor sector of the oil-patch. Earnings estimates of $1.90/sh this year and $2.30 in 1998 indicate continued growth. At the current stock price, the shares are approaching full value of $38-40 over the next few months and would be vulnerable in any stock market correction.

Freeport McMoran Copper & Gold (FCX.A on NYSE), New Orleans, LA , Tel: (504) 582-4000. Price: July 18/97: $27.50, 52-week range: $33.50 - 25.50. First mentioned at $25 on Oct 15/95. Major Indonesian producer of copper & gold. FCX is expected to produce 1.9 million oz Au next year and because it is such a large copper producer, it effectively ends up being one of the lowest cost gold producers, average cost equivalent to $85-90/oz. If a trend develops to buying gold stocks, FCX may well be an outperformer. The stock currently trades at about 25 times estimated earnings of $1.10 for 1997, low among gold producers.

Freewest Resources Canada Inc. (FWR on TSE and ME), Montreal, QC, Tel: (514) 878-3551, Price: July 18/97: $0.45, 52-week range: $1.34-0.36 . First mentioned at $1.06 on Aug 15/96. Historically, this company and its predecessor, the old Freewest, have treated shareholders well. The company is definitely suffering from the lack of interest in junior mining exploration stocks. Yet, Freewest is very active over a broad front. Drilling is resuming for copper & gold occurences in Botswana as well as surface diamond exploration in the same country. Drilling will take place later this year on a gold bet next to Holmer Gold Mines dicovery near Timmins, and on another gold exploration play on the Matawin gold belt near Thunder Bay, Ontario.

Golden Knight Resources Inc. (GKR on TSE, ME and VSE), Vancouver, BC, Tel: (604) 689-3846. Price: July 18/97: $2.50, 52-week Price Range: $10.10-2.25. First mentioned at $8.20 on May 15/96. Since closing its Quebec gold mine, GKR has been concentrating gold exploration mainly in West Africa. Its 17.5% interest in the Tarkwa, Ghana project where 15 million ounces of gold in an open-pit environment is indicated, equates to 2.6 million oz to GKR, or the equivalent of over $4/sh. Add to this a cash position of some $20 million, other good holdings in Ghana & Burkina Faso and more recently, an expanding gold & base-metal property near Tmmins, Ontario. Golden Knight, at these depressed levels, appears to be one of the most undervalued gold exploration stocks in Canada.

Murgor Resources Inc. ( MUG on ME), Montreal, QC. Tel: (514) 878-4216, Price July 18/97: $0.38, 52-week range: $0.96-0.31. First mentioned at $0.79 on Aug 15/96. Like many Canadian junior mining exploration firms, MUG's stock is suffering in the market place. Teck Corporation is currently drilling Murgor's promising Barry gold prospect in northwestern Quebec. The company could not fully test its Benoit gold zone, also in NW Quebec, this winter because of a lack of ice cover over Lac Pusticamica. The company is enthusiastic about its prospects in exploring for gold in northwestern Ontario, particularily in the Mishibishu area near the River Gold Mine. The company is considering some gold exploration possibilities in Peru. MUG is another active explorer worth watching.

Newcourt Credit Group Inc. (NCT on TSE and NYSE), Toronto, ON, Tel: (416) 981-9500. Price: July 18/97: $37.50, 52-week price range: $38.95-15.88. First mentioned at $9.85 on Nov 17/96. Leveraged growth in asset financing. With earnings estimates of $1.30/sh this year and $1.65 for 1998, the stock appears to be fully valued and would be vulnerable in any stock market correction.

NQL Drilling Tools Inc. (NQL.A on TSE), Nisku, AB, TEL: (403) 955-8828, Price: July 18/97: $8.50, 52-week range: $9.00-2.80. First mentioned at $3.20 on May 15/96. Well managed company involved in servicing the horizontal & directional oil & gas drilling industry with downhole tools. The company's announcement that it is raising $17 million by way of a private placement of 2 million exchangable warrants at $8.50 now adds to a whole new dimension of more accelerated growth. Without this new development NQL shares would have been considered fully valued at current prices.

Tusk Energy Inc. ( TKE on TSE and Alberta SE), Price: July 18/97: $1.60, 52-week range: $1.65-0.90). First mentioned at $1.42 on Feb 14/97. Tusk's main thrust is in the Meekwap, Alberta area where it is increasing oil production from horizontal development wells. In the meantime, it is farming out the reef sections in the Strachan, Alberta foothills area. This looks like a growth story.

Zoom Telephonics Inc. (ZOOM on NASDAQ), Boston, MA, Tel: (617) 423-1072. Price : July 18/97: $7.75, 52-week range: $13.12-6.12. First mentioned at $17 on Nov 17/95. The company was slow to make the transition to 56 K modems and was stuck with its 33.6 K. With the drop in sales and markdowns, Zoom expects to report a loss of $4.5 million in the June quarter, or $0.60/sh. Sales of 56 K modems are expected to increase significantly in the second half.