TORONRO STAR 4.30.97: New twists in Bre-X saga
CALGARY - BRE-X CHIEF geologist and Busang gold site discoverer John Felderhof is relaxing this week in the Cayman Islands.
Bre-X Minerals Ltd. president David Walsh, and the company's believers, are elated that Felderhof is catching rays at his oceanfront estate.
They've concluded the heavy-handed Indonesian authorities allowed Felderhof to depart from Busang only because they're convinced the gold is there.
After all, Felderhof left Indonesia before independent test results determine whether his gold find is a bust or a bonanza.
The Indonesians have a 40 per cent stake in Busang, which means they would face international ridicule if the Bre-X gold turned out to be a massive hoax.
And there were reports the Indonesians had placed Felderhof under house arrest at Bre-X's mining compound and were keeping him there until they'd cleared up the Busang mystery.
``If the Indonesians didn't think there was a lot of gold in the Busang, they would have never let Felderhof out of the country,'' argued Ted Carter, a Calgary-based stock market guru and Bre-X investor.
``Felderhof's being able to leave Indonesia tells me that the new tests went fine, that the Indonesians are now convinced there's gold in Busang and that Bre-X will be vindicated.''
``It's hard to understand why the Indonesians would let Felderhof out of their grasp if they thought all hell was going to break loose and he is responsible for their embarrassment,'' added Keith Miles, president of Templar Energy Ltd. and a friend of Walsh's for more than 15 years.
``It sure looks like the Indonesians think there's gold there.''
Indeed, a newspaper report yesterday out of Jakarta said the new Busang test results would reveal ``cheerful'' prospects.
That came after two Bre-X sister firms, Bresea Resources Ltd. and Bro-X Minerals Ltd., were awarded mining permits by the Indonesian government. Why would the Indonesians do that if they thought Bre-X was a bust?
Felderhof has been at the centre of the controversy over how much gold is at Busang, deep in the rain forests of Borneo.
Bre-X shares soared in the markets last year after Felderhof predicted that the Busang gold reserves could be as high as 45 million ounces. (The company later raised the estimate to 71 million, and in February Felderhof went so far as to put the potential figure at 200 million ounces.)
Felderhof was at Busang last month when Bre-X's mining partner, Freeport-McMoRan Copper & Gold Inc. of New Orleans, triggered the Bre-X meltdown in stock markets.
Bre-X shares cratered after Freeport said its preliminary tests had turned up ``insignificant'' amounts of gold at Busang.
Felderhof was Bre-X's observer when Toronto-based Strathcona Mineral Services Ltd. conducted its six-hole drill at Busang earlier this month for independent testing.
There were also observers from the Indonesian mining department and President Suharto's office.
Here we are only a few days before Strathcona reports and there are all these new twists in the Bre-X saga.
Little wonder Bre-X's hard-core believers are sounding upbeat counting down the final days before Strathcona's climactic report.
Jonathan Ferguson's column appears Monday, Wednesday and Saturday. |
