FREEWEST Update, Conversation with MAC 10/29/09

FREEWEST RESOURCES CANADA INC.

[Based on my discussion with Mac 10/29/09]
Freewest’s stock is outperforming Noront’s again this week .Considering Noront has
made an official 4::1 offer for Freewest. Of course with FWR.V trading at .51, and Noront at 1.91,
the market is skeptical of the offer and valuing FWR higher than NOT, and so the offer is passe. THAT WAS LAST WEEK.
This week FWR is trading at 49 and Noront at 1.65, so the discount off the offer is increasing.

Evaluating who owns what its clear that CLIFFS, FREEWEST Insiders, FREEWEST Institutional Holders plus the FREEWEST Rebels hold as Mac agreed, “way more than 51% of the stock.” I think that understanding makes the Noront offer a fools journey, with no more need being said of it.

Speaking of the relative land position of each [ Noront has 4X as much as FREEWEST ],
Mac reminded me that FREEWEST had its choice of what it was going to claim and passed up much of what Noront currently holds, picking the “GOOD STUFF”. This might explain why FREEWEST has
the Lion’s Share of the economic, strategic and logistically feasible, shipping tonnage in the RING of FIRE. He said at this point there is no other resource that anyone would build infrastructure to extract except that controlled by FREEWEST, at this time, in his opinion. Basically we both felt that this was an attempt by Noront to obtain by a sad offer what they failed to obtain by honest work on their own.

Basically he said, FREEWEST wants to explore and EXPLORE MORE and the Noront attempt at an offer is a short term distraction, save any other developments. While rumors abound concerning VALE, BHP, XSTRATA and RIO TINTO, soveign funds were not discussed today, but while FREEWEST is not pursuing other bids, they could still well be in play. I pointed out that
public comment said NO OTHER BIDS FOR FREEWEST were forthcoming was FALSE, since the market bids were considerably in excess of what Noront had to offer, reprsenting a 20% premium over Noront’s offer and far and above any backwards arbitrage differential. Further what tells the story is that Noront continues to trade at the days lows, and FREEWEST, at or near the day’s highs.

From a prospectors view, it was Mac’s opinion that the current Noront does not have what it takes to get development going in the RING of FIRE, as I added that Noront did not want to do anything involving their own cash..

While we discussed other issues, such as a takeover of Noront, they were not really relevant to what is happening now. What Mac did emphasize is the continining close coordination and partnership with CLIFFS, and CLIFFS aid and material assistance in both finance and logistics. I would infer here that CLIFS has no intention of letting anyone in what they must see as their “own backyard”.
DG.
Denaliguide & Associates, have long positions in FREEWEST.

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