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Currency

        Unless otherwise specified, all dollar references are to Canadian dollars. On June 4, 2003, one Canadian dollar was worth approximately $0.74 in U.S. currency, based on the noon buying rate in New York City for cable transfers in Canadian dollars, as certified for customs purposes by the Federal Reserve Bank of New York.

Forward Looking Statements

        This Annual Information Form contains "forward looking statements" within the meaning of the US Private Securities Litigation Reform Act of 1995. When used in this report, words such as "estimate", "intend", "expect", "anticipate" and similar expressions are intended to identify forward-looking statements  which are, by their very nature, not guarantees of Aber's future operational or financial performance, and are subject to risks and uncertainties.

        This forward-looking information mainly concerns Aber's plans for its diamond initiatives and is based on the conclusions of management. With respect to Aber's future revenues from its marketing activities, differences may result from developments in world diamond markets and diamond valuations and other factors. With respect to the Diavik Project, differences may result from additional drilling, sampling, and diamond valuations and from engineering and construction timetables and problems, financial arrangements, developments in world diamond markets, local, regional or national political developments in Canada and other factors. With respect to other projects, actual events may differ from current expectations due to exploration results, new exploration opportunities, changing budget priorities of Aber or its joint venture partner and other factors.

        Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this report. Due to risks and uncertainties, including the risks and uncertainties identified above and elsewhere in this Annual Information Form, actual events may differ materially from current expectations. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

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Item 1: Corporate Structure

Name and Incorporation

        Aber Resources Ltd. was formed on April 19, 1994 under the Company Act (British Columbia) by the amalgamation of a predecessor company (also called Aber Resources Ltd., which had been incorporated on July 8, 1980) with Commonwealth Gold Corporation ("Commonwealth Gold"). In August 2000, the company name, Aber Resources Ltd., was changed to Aber Diamond Corporation. On July 12, 2002, Aber Diamond Corporation was continued under the Canada Business Corporations Act. In this Annual Information Form, unless the context otherwise dictates, a reference to "Aber" or the "Company" refers to Aber Diamond Corporation and, where appropriate, its predecessor corporations and its subsidiaries.

Intercorporate Relationships

        Aber Diamond Corporation's corporate structure is as follows:

[GRAPHIC]

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Item 2: General Development of the Business

Three Year History

        During the year 2002, the Diavik Project completed its construction phase and moved into full scale commissioning of the mine, process plant and all support facilities, ahead of schedule and comfortably within budget.

        The four-kilometre-long dike enclosing the area of the first two orebodies to be mined, A-154 South and A-154 North, was completed in the middle of the summer. This substantial civil engineering project accounted for almost half of the Diavik Project capital cost and was the principal project completion risk item. The water behind the dike and overlying the orebodies was removed during the third quarter of 2002, with water discharge quality being controlled by processing in a water treatment facility as required. The pre-stripping of the lake bottom and glacial sediments overlying the open pit mining area was started in the third quarter of 2002 and the first diamond bearing kimberlite was exposed in November.

        The access to mineralized kimberlite allowed early pre-commissioning of the processing plant to proceed during late November and December with the first parcel of 106,320.76 carats of diamonds being reviewed by the Canadian Government Diamond Valuer in late January 2003 at the Project Production Splitting Facility in Yellowknife. Aber's 40% share of these diamonds was sorted in Toronto during February and sold during March to Tiffany & Co., with whom Aber has a long-term sales contract, and to the Antwerp market. The average price received was US$96.22 per carat, which compares favourably to the US$79 per carat predicted by the May 2000 Bankable Feasibility Study. Approximately half of this improvement is attributable to improved diamond quality compared to the Feasibility Study projections, with the other half being due to an under recovery of small, low value diamonds. During the ongoing process plant commissioning, improvements are being made to the small diamond recovery circuit with the objective of delivering 99% of contained value in full production.

        Most of the material processed to date lies above the formal ore reserve blocks. It consists of fine-grained kimberlite ash, mixed with relic lake bottom sediments from the shallow lake that overlay the site of the kimberlite eruption that took place some 53 million years ago. Despite the intervening time period, this material never consolidated into lithified rock. It has the character of loose sand and was not recovered during the core drilling phase of the orebody delineation, and, as such, is outside the initial reserve estimate. During the ongoing mine commissioning process, the feed delivered to the process plant will continue to be an unpredictable mixture of kimberlite ash and some ore reserve kimberlite mixed with glacial and lake bottom sediments. Although this has the effect of delaying the full-scale production of diamonds at reserve grades, it does result in recovery of additional diamonds beyond the ore reserve estimates.

        The A-154 North kimberlite pipe represents an overall mineral resource of 27.6 million carats of diamonds, most of which are not assigned in the Feasibility Study to economically mineable "mineral reserve" status. As of the date of this report, preparations are being made to campaign mine and process approximately 20,000 tonnes of mineralization from the top of the A-154 North kimberlite pipe. It is expected that the diamonds recovered from this bulk sample will be delivered in July 2003. The diamond price determined from this work will be used to aid future mine planning and ore reserve estimation.

        The operator, Rio Tinto plc, has estimated that the Diavik Project will deliver a total of 3.7 million carats of diamonds during the 2003 calendar year, with Aber's 40% share being 1.48 million carats. Approximately one million carats of these will be delivered to Aber before the end of November, thereby allowing them to be sorted and sold by Aber's fiscal year-end of January 31, 2004. The Company anticipates full production to then be delivered throughout 2004 allowing the Diavik Project, and Aber itself, to demonstrate full earnings generating potential.

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        During the year, Aber completed the purchase of real property (land and building) in Toronto, Ontario for a portion of its operations, for a purchase price of $23.6 million, including all costs of acquisition. In connection with this, the Company assumed an existing first mortgage in the amount of $11.1 million.

        On January 29, 2002, Aber announced the closing of a US$230 million Diavik Project loan facility (the "Loan Facility") to fulfill its Diavik Project funding requirements. The Loan Facility was underwritten on November 2, 2001 by a lead bank group made up of Bank of Montreal, Canadian Imperial Bank of Commerce, Deutsche Bank AG, Export Development Canada and Royal Bank of Canada. The Bank of Tokyo-Mitsubishi joined the lead bank group prior to closing. The lead group was formed in May 2001, with Bank of Montreal becoming the Collateral agent, Canadian Imperial Bank of Commerce the Technical agent, Deutsche Bank AG the Insurance agent and Royal Bank of Canada the Administrative agent. The Loan Facility was successfully syndicated in January 2002, with the overall banking group totaling 15 lenders.

        In December 2000, Diavik Diamond Mines Inc., the operator of the Diavik Project, completed a detailed construction program for 2001 and 2002, with the objective of advancing commercial production into early 2003. The most critical individual item affecting an advanced production schedule was the completion of the scheduled A-154 dike construction program, followed by de-watering of the A-154 pool and clearing of the lake till overburden to gain access to the diamond bearing kimberlite ore. In October 2001, the 3.9 kilometre-long rock berm surrounding the A-154 South and North kimberlite pipes, the principal construction risk of the Diavik Project development, was completed.

        In February 2001, Aber sold its 32.24% interest in the Snap Lake project to the majority interest holder and project operator, De Beers Canada Mining Inc., for US$114 million (C$173 million), providing Aber with essential additional equity funds to fulfill its Diavik Project funding requirements.

Item 3: Narrative Description of the Business

General

        With the development of the Diavik Diamonds Project (the "Diavik Project"), the Company is positioned to become a vertically integrated diamond marketing company supplying a Canadian product to the global diamond market. While exploration and development interests remain with the Diavik Project, the Company's primary attention has turned to maximizing the value of its diamond production.

        The Company's most significant asset is a 40% interest in the Diavik group of mineral claims. Diavik Diamond Mines Inc., ("DDMI"), a subsidiary of Rio Tinto plc, is the operator of the Diavik Joint Venture (the "Joint Venture") and holds the remaining 60% interest.

        Commercial production from the Diavik Project will commence upon achievement of certain production and sales performance measures related to the Project including physical project completion, a sustained level of mining and diamond processing activity and sales channel readiness. The financial statements of the Company for the year ended January 31, 2003 do not reflect any commercial activity relating to the Diavik Project.

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Sales and Marketing

        The Company sells its diamonds by means of two sales channels: (i) directly to Tiffany & Co. ("Tiffany"), and (ii) to the Antwerp open market, through a wholly owned subsidiary, Aber Overseas N.V. The Company formed a strategic alliance with Tiffany, a world leader in retail sales of high quality diamond jewelry, in July 1999. The Aber-Tiffany agreement involved a $104 million private placement of Aber equity and a 10-year diamond purchase agreement providing for a minimum purchase by Tiffany of US$50 million per year, commencing at the beginning of commercial production from the Diavik Project. As of June 4, 2003 Tiffany owned 8,000,000 common shares of Aber, representing approximately 14.6% of the issued and outstanding common shares of Aber. Sales to Tiffany are expected to be approximately 25% of the value of the Company's diamonds.

        In January 2002, Aber and Overseas Diamonds N.V., a leading Antwerp diamantaire and diamond manufacturer, formed Aber Overseas N.V., formerly known as CanaDiam N.V., to market a portion of Aber's share of the diamond production from the Diavik Project. Aber Overseas N.V. was subsequently owned 51% by Aber and 49% by Overseas Diamonds. During the quarter ended April 30, 2003, Aber concluded an arrangement whereby Aber Overseas N.V. was restructured such that it became a 100% owned subsidiary of the Company. By the end of the first fiscal quarter of 2003, Aber Overseas N.V. had made sales to international clients in several diamond markets and manufacturing centres, including in Belgium, India and Israel. Aber Overseas N.V. is currently positioned to act as a rough diamond dealer, supplying a wide range of product priced and assorted with flexibility, reflecting current market conditions.

The Diamond Market

        The core value of the production from the Diavik Project is in large, white gems. High (white) colours are characteristic throughout the production in all qualities, including the cheaper ranges of diamonds. Pricing in large and high colour rough has remained strong throughout the last few years, and the fundamentals of supply and demand suggest this trend will continue. High colour diamonds continue to lend themselves to the traditional taste of the US, the world's biggest diamond market. In an industry continually seeking excellence, they also form the fuel for the branding movement prevalent today within the diamond business. Current and future Canadian mines will add to the volume of this type of material available in the rough markets. However, alternative supply, both within and outside De Beers' Diamond Trading Company ("DTC"), remains tight. Previously, an increase in supply of a particular diamond type has led to an expansion of the market and the creation of new demand. When the Argyle mine began operating in the early 1980's, there was little existing market for much of its, on average low value, production. The Company does not feel, however, that the creation of new market demand is required to absorb production from the Diavik Project. Rather, this production has arrived into a market anxious to receive it and already able to process it. Aber sees the long-term prospects for demand and pricing in its product as robust.

        Every diamond mine, to some extent, produces a broad range of diamond qualities. Although larger, white diamonds form the core of the value of the production from the Diavik Project, on a volume basis, white diamonds in lower qualities predominate. A substantial volume of brown diamonds in all sizes is also present. The great majority of this material, as well as an increasing proportion of the larger better goods, will be manufactured in India. India now boasts outstanding technical expertise in addition to its traditional cost advantage. Clients from the Indian manufacturing centres will be of particular importance to Aber, as will Aber's understanding of the Indian diamond industry.

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        The market for polished diamonds in 2002 was mixed in response to unsettled economic conditions in important diamond consuming countries. Throughout the year, purchasing was conservative and inventories remained low amidst the uncertainties brought on by war and economic slowdown. The 2002 US Christmas season, with early pessimism followed by better than expected sales, was largely a repeat of the 2001 season. Throughout the year, polished prices remained flat, giving the impression of market sluggishness. Nevertheless, the US market was up marginally in 2002, and overall the world demand for polished diamond jewelry grew by 4%, exceeding world GDP growth for the first time in many years. This performance is a tribute to De Beers' advertising and revised sales strategy, which has encouraged advertising spending by its customers. Another important element of this story was renewed demand in the far eastern markets (outside of Japan) and the emergence of India and China as strong domestic markets for polished diamonds. In addition to the overall sales growth in these countries, the average colour and clarity profile of the diamonds sold appears to be changing. Consumer preferences, especially in China, are no longer exclusively in the cheaper items.

        The rough market was strong in most product segments throughout the year. This was despite continued destocking by De Beers of up to an estimated US$1 billion of rough diamonds, which is believed to have continued into the first quarter of 2003. The contradiction between the vigorous rough market and the perception of sluggishness in the polished market was a feature of 2002, which appears now to have been reconciled by the bullish year-end diamond jewelry results. Most of the extra rough appears to have found a channel within the diamond pipeline, albeit at the expense of increased debt in the manufacturing centres. Even with the destocking by De Beers, some items remained in short supply throughout the year, especially large, top colour, top clarity diamonds with good shapes. Items that showed weakness in 2002 were brown diamonds and, into 2003, large cheap gems. In the former case, this was in large part due to a movement by the large US mass marketers away from inexpensive, brown diamond jewelry into white equivalents.

        Through 2002, De Beers' rough maintained a reputation for being the least expensive and DTC clients enjoyed strong margins. Non-DTC rough was more expensive. The past year again reinforced the strong competitive position of manufacturers and dealers with direct supply from the producers. In addition to the advantages in price, the De Beers Supplier of Choice ("SoC") strategy is causing more rough to be retained within specialized marketing channels, and rough is increasingly difficult to source on the open market. We see increasing evidence that companies seeking vertical integration through involvement in jewelry manufacturing and distribution businesses are becoming less willing to found their new investments on the uncertain supply offered by the rough traders. This process has a two-fold benefit for Aber, in that it creates a marketing niche for Aber rough, while fostering the demand-driven culture by which the whole diamond industry will benefit. The approval of SoC by the European Commission in early 2003 marked the permanence of this new market reality.

Competitive Conditions  The Diamond Market

        Factors beyond Aber's control may affect the marketability of any rough diamonds produced by the Diavik Project. These factors, which are more fully discussed above, include the world supply and demand for rough diamonds and the policies of the major industry supplier, De Beers and the DTC.

Employees

        As of June 4, 2003, Aber had 47 employees. The employees are not unionized. There were no strikes in the past year and management considers the relationship of Aber with its employees to be excellent. Diavik Project personnel are employed by DDMI and not by Aber.

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Real Property

        During the year, Aber completed the purchase of real property (land and building) in Toronto, Ontario for a portion of its operations, for a purchase price of $23.6 million, including all costs of acquisition. In connection with this, the Company assumed an existing first mortgage in the amount of $11.1 million.

Risk Factors

        Aber's ability to generate revenue and profit is dependent upon a number of factors relating principally to the Diavik Project, including, without limitation, the following:

1.

The Diavik Project must comply with Canadian federal and territorial government regulations and permits. The cost of compliance could affect the ability of the Diavik Project to produce diamonds at a profit. More information about the regulations affecting the Diavik Project can be found on page 23.



2.

Although the Diavik Project is located on federal Crown lands administered by the Canadian government, the region is subject to Aboriginal land claims and Self Government negotiations. A major federal legislative initiative, the Mackenzie Valley Resource Management Act, became law in 1998. It allows the Canadian government to share land-use permitting and environmental assessments of mineral projects with northern Aboriginal peoples through public review, planning and water boards. Half of the members of any board will be federal and territorial government nominees, and the remainder will be nominated by Aboriginal land claimant groups. This Act has now succeeded the Canadian Environmental Assessment Act as the legislative authority regulating the Diavik Project. DDMI continues to actively consult with Aboriginal communities. Up to this point, the boards created under the authority of the Mackenzie Valley Resource Management Act continue to reflect the same public and community interests as the responsible authorities under the Canadian Environmental Assessment Act. More information about Aboriginal issues can be found on page 14.



3.

During construction and operations, the Diavik Project will face risks inherent in the mining industry, including variations in grade and other geological differences, unexpected problems associated with required water retention dikes, water quality, surface or underground conditions, processing problems, mechanical equipment performance, accidents, labour disputes, risks relating to the physical security of the diamonds, force majeure risks and natural disasters. Such risks could result in: personal injury or fatality; damage to or destruction of mining properties, processing facilities or equipment; environmental damage; delays in mining production; monetary losses and possible legal liability. Aber currently maintains property and liability insurance but such insurance may not cover all contingencies arising from its business.



4.

The Diavik Project, because of its remote northern location and access only by winter road or by air, is subject to special climate and transportation risks. See "Accessibility, Climate, Infrastructure and Physiography" on page 15 for further information. These risks include the inability to operate or to operate efficiently during periods of extreme cold, the unavailability of materials and equipment, and unanticipated transportation costs. Such factors can add to the cost of mine development and operation, thereby affecting profitability.

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5.

The market for rough diamonds is subject to various factors and is largely controlled by the world's largest diamond producer, De Beers Consolidated Mines Ltd. ("De Beers"), which has the ability to influence prices through the control of sales volumes. Aber will therefore be subject to pricing influenced by a competitor. For a more detailed analysis of management's current view of the diamond market, see page 6.



6.

DDMI, the Project Manager, has a 60% interest in the Diavik Joint Venture and has a controlling vote in essentially all Joint Venture management decisions respecting the development of the Diavik Project and the Diavik Property.



7.

Production at the Diavik Project is dependent upon the efforts of certain skilled employees of DDMI. The loss of these employees or the inability of DDMI to attract and retain additional skilled employees without incurring material additional costs may adversely affect diamond production from the Diavik Project. Aber's success at marketing diamonds is also dependent on the services of certain key executives and skilled employees, as well as the continuance of relationships with certain third parties, such as diamantaires. The loss of these persons or the Company's inability to attract and retain additional skilled employees or to establish relationships with required third parties may adversely affect its business and future operations in marketing diamonds.



8.

Currency fluctuations may affect the revenues the Company will receive from diamond sales. Diamonds are sold throughout the world based principally on a US dollar price. Many of the costs and expenses of the Joint Venture, which are borne 40% by Aber, are incurred in Canadian dollars. The appreciation of the Canadian dollar against the US dollar can therefore be expected to increase the expenses of the Joint Venture relative to the revenue Aber will receive from diamond sales. The Company currently does not enter into contractual hedges to mitigate this currency risk. The Loan Facility is, however, in US dollars, and therefore offsets, to a certain degree, the risk inherent in a depreciating US dollar.

Mineral Properties

        Aber has mineral interests in a few geographically distinct properties. However, only the DDMI-Aber block of the Diavik Property, which is set out in Table 2, is under development and considered to be material to Aber. As at January 31, 2003, the Diavik Property was carried on Aber's balance sheet with a book value of $581.7 million. Book value is the cumulative expenditures on a property, less write-downs recorded to reflect a longer-term view of potential recoverable value. The book value is not necessarily indicative of the fair value.

        On January 31, 2001, Aber held a 32.24% interest in the Snap Lake Northwest Territories diamond project. Aber's interest in the Snap Lake Project was sold to De Beers Canada Mining Inc. for US$114 million (C$173 million) in February, 2001. Aber recorded a gain of approximately C$85 million after taxes in respect of this transaction in the first quarter of fiscal 2002.

Expenditures on Mineral Properties

        Aber expended $229.2 million on exploration and development during the year ended January 31, 2003, up 27% from $180.9 million the previous year.

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