Response from EDC Re: INCO - January 17, 2005

January 17, 2005

Mr. Fraser Reilly-King
NGO Working Group on EDC
153 Chapel Street. #104
Ottawa Ontario  K1N 1H5

Dear Mr. Reilly-King,

This refers to your letter of October 20 regarding the INCO Goro Nickel Mine in New Caledonia. First, I should point out that your correspondence referenced our letter dated January 7, 2003 to your enquiry of October 23, 2002; please note that you wrote us regarding INCO's plans for expansion in Indonesia, not New Caledonia, and our reply related to the same.

Regarding the subject of your current letter, the Goro Nickel Mine in New Caledonia, Mining Watch, a Halifax Initiative coalition partner, accompanied traditional leaders from New Caledonia when they attended a meeting at EDC offices on March 19, 2003. The meeting with the New Caledonian leaders provided us with an opportunity to gain an understanding of their perspective of potential project impacts, and equally important, to explain our disclosure and environmental review procedures.

EDC's obligations of confidentiality to its customers prevent it from discussing transactions, proposed transactions and rejected transactions. As you are aware, EDC does, however, have a disclosure policy which provides, among other things, for the release of information on individual transactions, and EDC is comitted to obtaining the necessary consensts from customers to enable it to make disclosure in accordance with the terms of that policy.

A project such as the Goro Nickel Mine with its potentially significant environmental impacts would be covered by the Disclosure Policy's provision for advance public notification. Such projects are typically posted in the D3 area our website at:  Projects such as this one would be subject to a full review Under our Fnvironmental Review Directive This review would take into consideration environmental as well as social impacts.

We respectfully suggest that you periodically consult the disclosure area of our website which is a rich source of transaction-based information and has developed into an extensive database.

In closing. I would like to refer to you recent media articles about the Goro Nickel Mine. Those reports indicate that the French government may provide debt financing for the development of this project.

Thank you for your comments on this project.

Yours sincerely,

Rosemarie Boyle

Corporate communications and External Relations