Securities Law & Instruments

Headnote

Filer is exempt from the requirement to filea technical report, not later than 30 days after the date ofissuance of a press release, provided that such reports arefiled not later than 90 days after the issuance of the pressrelease.

Rules Cited

National Instrument 43-101 - Standards of Disclosurefor Mineral Projects, subsections 4.2(4) and 9.1(1).

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

BRITISH COLUMBIA, ALBERTAAND ONTARIO

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

MOUNTAIN PROVINCE DIAMONDSINC.

 

MRRS DECISION DOCUMENT

WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof British Columbia, Alberta and Ontario (the "Jurisdictions")has received an application from Mountain Province DiamondsInc. (the "Filer") for a decision under the securitieslegislation of the Jurisdictions (the "Legislation")that the requirement contained in the Section 4.2(3) of NationalInstrument 43-101 -- Standards of Disclosure for Mineral Projects("NI 43-101") that a current technical report be filedto support information describing mineral projects on a propertymaterial to the Filer not later than 30 days after the disclosureshall not apply to the Filer;

AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the British Columbia Securities Commission is the principalregulator for this application;

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions;

AND WHEREAS the Filer has representedto the Decision Makers that:

1. the Filer is the resulting corporationfrom a November 1997 amalgamation under the Company Act(British Columbia);

2. the Filer is a reporting issuer in theprovinces of British Columbia, Alberta and Ontario;

3. the authorized capital of the Filer consistsof 500,000,000 common shares without par value, of which 66,602,766common shares were issued and outstanding as at April 30,2003;

4. the Filer's common shares are listed andposted for trading on the Toronto Stock Exchange and are quotedon the NASD Over-the Counter Bulletin Board in the UnitedStates of America;

5. the Filer is engaged in the explorationfor and development of diamond bearing properties in Canada;

6. the Filer's most significant property isthe AK-CJ property (the "AK Property") located inthe Northwest Territories, Canada;

7. the Filer is in a joint venture with DeBeers in respect of the AK Property pursuant to which, DeBeers may earn up to a 60% interest in the AK Property, inexchange for conducting an exploration program on the AK Propertyand a bulk sampling program on one or more new kimberlites,completing a feasibility study on one or more new kimberlites,and funding the development and construction of a commercialmine;

8. De Beers is the operator on the AK Property;

9. on April 15, 2003, the Filer received fromDe Beers, the results of a recently updated desktop studyfor the Gaucho Kue diamond project on the AK Property;

10. the desktop study showed that estimatedcapital costs increased slightly and the estimated operatingcosts dropped significantly; however, the effect of lowerdiamond prices and of a lower US dollar as against the Canadiandollar, since a desktop study completed in 2000, resultedin a slightly lower internal rate of return ("IRR")than that previously obtained;

11. due to the lower IRR, which is below theagreed upon hurdle rate contained in the joint venture agreement,combined with the geopolitical environment and uncertainties,De Beers informed the Filer that they had decided to postponea pre-feasibility decision for one year;

12. the Filer issued a news release on April15, 2003 (the "April 15 Release"), disclosing theresults of the desktop study, and the decision by De Beersto postpone the pre-feasibility decision;

13. subsection 4.2(4) of NI 43-101 requiresthe Filer to file a current technical report to support materialinformation contained in a press release, describing any changein a preliminary assessment or in mineral resources or inmineral reserves that constitutes a material change in respectof the affairs of the issuer, not later than 30 days afterthe disclosure;

14. the April 15 Release disclosed a changein a preliminary assessment that constitutes a material changein the affairs of the Filer;

15. AMEC E & C Services ("AMEC")worked on the desktop study as part of the project team establishedby De Beers, and are in the process of preparing the Reportto support the April 15 Release;

16. the Filer has recently been advised thatAMEC will not have the Report completed until approximatelythe end of May, 2003; and

17. the Filer will not be able to file theReport required under NI 43-101 to support the disclosurecontained in the April 15 Release within the 30 day time periodrequired by NI 43-101;

AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers underthe Legislation is that the requirement contained in NI 43-101that a technical report be filed to support information in theFiler's April 15 Release not later than 30 days after the disclosureshall not apply to the Filer, provided that the Filer preparesand files the Technical Report not later than 90 days afterthe issuance of the April 15 Release.

May 15, 2003.

"Noreen Bent"