1. Economic Development 2004 4th Quarter Rural Nevada Report

2. 2 Economic Development Overview Northern Nevada  Total committed companies year-to-date are 32 (21 Manufacturers)  Total economic impact year-to-date is: $274 Million  Total households added year-to-date are : 2,024  Commitments should continue at this pace into 2005.  Activity will remain strong. Increased activity in Elko, Fallon, Lovelock and Winnemucca regions. Opportunity for rural Nevada to exploit:  Unemployment in Washoe County in October fell to 2.8 percent from 3.1 percent a month earlier. The state says the jobless rate in the Carson City labor market, which also includes Douglas, Lyon and Storey counties, fell to 3.8 percent from 4.2 percent in September. Statewide, the jobless rate in October stood at 3.6 percent — the lowest rate in more than 25 years.  Nevada’s “Will Your Business Be Terminated” Campaign launched last October generated more than 260 local, regional and national stories worth more than $6 million in media value.  U.S. Department of Agriculture today designated all 17 Nevada counties as drought affected. The designation makes all Nevada agricultural producers who suffered a loss eligible for emergency farm assistance programs.  Nordic Windpower, a wind turbine manufacturer based in the United Kingdom, will build a manufacturing plant in northern Nevada as soon as a Nevada wind energy project of sufficient size is committed to construction. Energy Nevada of Carson City and Nordic Windpower inked the deal this week.

3. 3 Economic Development Activities  The Northern Nevada Partnership, formerly known as the Mining Sustainability Group, whose mission is to regionalize and support cooperative economic diversification in rural Nevada. Members from the mining industry (Newmont, Placer Dome and Barrick), Elko County and Economic Development Board, BLM, Great Basin College, met with Lander County and their Economic Development Board  NevadaWorks Board of Directors Activities: Promotion of Nevada Works to identify/quantify rural skill sets required to meet targeted recruitment and expansion goals. Objective: Merge Nevada Work’s resources of training dollars and on-site employment services with rural community's targeted industries’ initiatives (Both retention and recruitment) Promote local JobConnect and development authorities’ Partnerships, through involving JobConnect managers and community colleges in local EDA planning and industry targeting plans and EDA boards.  Industrial Park Map and Directory Phase One completed and submitted to Rural Development Authorities for response. Currently, majority of rural Nevada Industrial Parks are listed on Sierra Pacific’s Economic Development web site at http://econdev.sierrapacific.com  Gold Mining activity in North and Northeastern Nevada continues to expand as new sites are developed to supply gold to an increasingly valued market. Reports of operational constraints due to late delivery of trucks, muckers and other mining equipment.  Sierra Pacific to partner with NDOT and the Nevada Commission on Economic Development in implementing State-approved economic development transportation monies for rural Nevada.

4. 4 Economic Development Activities  Fernley Industrial companies continue to strategize effective employee recruitment strategies and retail/commercial development initiatives. Members include: Quebecor, Amazon.Com, Trex, MSC Industries, A.R.E., Johns Manville, Honeywell, UPS Logistics, RMAX, Valley Joist, and Fortifiber.  BNSF has agreed to study infrastructure investment in northern Nevada, to be phased in:  Storage tracks used to build trains  Manpower in lieu of contracting with UP  Intermodal Facility  BNSF Transloading Operation  SBA has agreed to guarantee the financing of the Wells Renew Tire Facility Project  USDA has agreed to guarantee the financing of a commercial center in Fernley comprised of a Bowling Center and retail.

5. 5 Economic Development Activities Sierra Pacific Economic Development continues to nurture important business and political relationships with the following development authorities and economic developers: Union Pacific Railroad Burlington Northern Railroad Elko County Economic Diversification Authority Humboldt Development Authority Northern Nevada Development Authority Churchill County Development Authority Lander County Economic Development Authority Pershing County Development Authority Lyon County Economic Development Authority Mineral County Economic Development Authority Western Nevada Development District NCED/Rural ED Manager/NCED Marketing Manager and Rural Conference

6. 6 Economic Development Activities Elko County  Strong job growth in mining maintenance, retail, construction and agriculture (alfalfa and beef production)  Met with Steve McLaws, Union Pacific Director of Industrial Development and ECEDA Executive Director, identified UP’s investment interest in developing a regional transloading facility.  Toured Elko County with Burlington Northern’s Economic Development Manager, Kevin Palmer, to identify industrial park development potential.  Bulk fuel transloading identified as growth industry in northeastern Nevada.  Retail Developments: Home Depot permits pulled, construction to begin once conditions of approval are addressed. Super Wal-Mart opening Fall 2005. Walgreens to start construction Spring 2005.  Expanding housing market due to job growth.  Casino Express adding 15 flights a month, 1800 new visitors.  Casino Express Airlines will offer gambling junkets to the Peppermill Corp.’s properties in West Wendover beginning in mid-January. Players from 16 cities will have the opportunity to visit the Peppermill, Montego Bay, and Rainbow hotel-casinos. There will be 20 flights per month. Each plane can carry 122 passengers.  Scenic Airlines will begin air service from Elko to Las Vegas by late winter. It will replace Sky West on the Elko-Reno route later.  Existing transloaders in Carlin have expressed desire to provide services to outside vendors.  Wells Tire Recycling plant moving forward as permits and financing through local investment board reach completion. 15 employees to start  SBA has agreed to guarantee the financing of the Wells Renew Tire Facility Project  Queenstakes Resources Ltd says its Jerritt Canyon Mine 50 miles north of Elko produced 73,070 ounces of gold in the 3 rd quarter, up 20 percent from the 2 nd quarter  New mine, Leeville, and Gold Quarry expansion to be operational 4 th quarter 2005.  Home Depot expects to begin construction of its Elko store in January. The store will cover 102,000 square feet plus a 35,000 garden center. The store should open in the summer of 2005.

7. 7 Economic Development Activities Lander County  Placer Dome Inc. says its huge gold discovery at Cortez Hills north of Austin is even bigger than originally thought. After drilling 94 holes, Placer Dome estimates its 60 percent share of the property holds 9 million ounces of gold. Previous estimates showed the company’s share to be 7.6 million ounces. (At $400 an ounce, the holding would be worth $3.6 billion.)  Participated in Northern Nevada Partnership meeting in Battle Mountain with area businesses and political leaders to identify opportunities to leverage and utilize mining industries’ assets to diversify regional economy.  Angel Fire Water Company continues discussions with Lander County.  Newmont’s 200 MW Power Plant, will employ 650 construction workers in Lander County for two years, and create 150 power plant jobs. Plant will supply electricity for Newmont’s Nevada operations except Gold Quarry north of Carlin.  Cortez Mine creating 40 to 60 new jobs by the end of 2004  Newmont Mining Corp. has begun construction on the $200 million Phoenix Project near Battle Mountain, three months ahead of schedule. The project has been in the planning and permitting stages for a decade. Construction should continue until mid-2006. There will be about 450 workers on site during the construction phase. The mine will employ about 300 when it becomes operational. Many of the workers will be transferred from the Lone Tree Mine, which should halt mining operations in August 2006. About 6 million ounces of gold reserves and 45 million ounces of silver reserves have been identified at the Phoenix site, and mining could continue for 15 years. The mine could also produce 21 million pounds of copper per year. The area around the mine has been excavated for about 140 years.

8. 8 Economic Development Activities Mineral County  Continue to assist materials transportation and storage company’s plans to locate facility east of Hawthorne  Security Training School to locate to Hawthorne Airport.  Columbus LLC, a calcium and magnesium mining operation, operating south of Gold Hill Junction as Columbus Marsh and generating 35 new jobs for Mineral County  Shelley Hartman hired as new Executive Director of the Mineral County Economic Development Authority. White Pine County  Bald Mountain Mine expanding with 25 jobs, operated by Placer Dome  Robinson Mine project commenced to employ 300, 50 additional jobs needed. Community looking to recruit housing developers.  Negotiations continue toward construction of a coal fired, 1600 MW power plant with L.S. Power.  Community continues to pursue purchase of Los Angeles Water and Power’s rail line.  Retail sector experienced a strong summer tourist season.  Retail co-op to open November 2004  80 room Hampton Inn to break ground Spring 2005 in Ely.  Enrollment in the White Pine School District increased by 4.78% for the 2004-2005 school year. Enrollment had declined every year since 1998.

9. 9 Economic Development Activities Churchill County  The Fallon area housing market had a remarkable year in 2004, and further growth is expected. The number of permits for new homes issued by the City of Fallon and Churchill County near doubled in 2004 from the previous year, to nearly 240 from 120. Several new subdivisions are planned in the Fallon area that will add several hundred homes. The inventory of existing homes on the market is currently around 30, well below the average for a market of similar size.  The defense budget bill approved by the U.S. Senate includes $4.7 million for construction of explosives- storage facilities at Fallon Naval Air Station.  Matthew Homes closed escrow on the 1,700 acres Great Basin Industrial Park  1,700 acre industrial Park in Hazen. Awaiting county Master Plan approvals  Site Visit with Glass Manufacturer to Great Basin Industrial Park  County to support the development of geothermal farms  Regional Airport concept being reviewed  Participated in Nevadaworks’ Listening Session with local business leaders and identified training and recruitment needs.

10. 10 Economic Development Activities Storey County New companies in Tahoe Reno Industrial Center:  Wal Mart Distribution Center - 880,000 square feet, 550 jobs  James Hardie Building Materials  Golden Gate Petroleum  Barrick’s Power Plant, 118 MW under construction: During construction, there would be up to 350 jobs generated by the project. Once completed, it would be operated by a crew of fewer than 25. It would generate up to 118 megawatts of power from 14 gas-driven generators. Power will be used by Barrick's properties near Carlin on the Eureka-Elko county line Eureka County  Ruby Hill gold mine set to reopen Spring 2005, housing available  Newark Valley in the Diamond Mountains area experiencing new oil exploration and drilling. Pershing County  Community currently working with manufacturers and distributors of wall systems, camping equipment and dental accessories.  County developed incentive policy to attract and retain industry.  Community submitted proposal to locate 90,000sf trailer manufacturer, 200 jobs  Aeroponics company to purchased property in Pershing County Industrial Park  Site Visit and Community Presentation to Wall Systems Manufacturer.

11. 11 Economic Development Activities Humboldt County  Apollo Gold reports its Florida Canyon Mine 42 miles southwest of Winnemucca produced 14,820 ounces of gold at an average cash cost of $406 an ounce in the third quarter. The mine produced 26,158 ounces at a cash cost of $289 a year earlier. The company, which lost $6.1 million in the quarter, says it slowed mining to conserve cash.  Nevada Geothermal Power Inc. says it struck a deal with Inovisions Solutions Inc., a Canadian firm that will invest up to $5 million(Canadian) in the Pumpernickel Valley geothermal project near Winnemucca.  Carry On Trailer Corporation announced its decision to construct a 90,000sf manufacturing facility employing 150 people, at the Winnemucca Airport Industrial Park, operational 2006  Mining Exploration activity increases:  Getchell Mine expansion (Turquoise Ridge Mine), truck drivers and welders hired  Glamis Gold’s Marigold mine operation ramping up and possible expansion  Newmont’s Phoenix Project moving forward toward 2006 start up.

12. 12 Includes City of Reno, City of Sparks, and Washoe County. Information obtained from the respective building departments. Includes Carson, Churchill, Lyon, Douglas, Nye and Storey counties. Esmeralda does not have building permits. Mineral County is not available at this time. The cities of Fernley & Fallon are also included. (2004 4 th quarter data only) Information obtained from the respective building departments. Includes Elko, Lander, and Humboldt counties. Eureka County does not have building permits. Pershing County not available at this time. The cities of Elko & Winnemucca are also included. (2004 4 th quarter data only) Information obtained from the respective building departments. Economic Development Trends

13. 13 Economic Development Trends

14. 14 Information obtained from the Nevada Department of Employment, Training & Rehabilitation Economic Development Trends

15. 15 Product/ServiceSquare Feet/Acres # EmployeesArea(s) of Interest Data Center150,00020Elko Industrial Park Development 60 AcresTBDElko Horse Trailers50,000TBD Engineered Communication & Measurement Svcs 35,000TBD Construction Management Svcs TBD15Elko/Reno 2004 Most Active Prospects Economic Development

16. 16 Product/ServiceSquare Feet/Acres # EmployeesArea(s) of Interest Sporting Goods100,00050TBD Wind Farm Generator & Turbine Mfg TBD30Northern Nevada Distribution2 Million2,000Elko/Winnemucca TRIC/Fernley Training of Military Operations 15,000 sf35-50Hawthorne 2004 Most Active Prospects Economic Development