Tuesday, April 8, 1997
Can Barrick solve the Bre-X riddle?
OSC has the power to demand access to information obtained by Barrick and
Placer Dome as part of their efforts to join in development of the Busang play
The latest Bre-X news and analysis
By DAVID THOMAS
The Financial Post
The Ontario Securities Commission has the power to force Barrick Gold Corp. to release information
that may shed some light on the Bre-X Minerals Ltd. Busang mystery.
However, the OSC would not confirm if it has asked Barrick to release data regarding Bre-X's
Busang find, which Barrick obtained during its recent bid to take control of the embattled Calgary
junior.
While experts say Barrick is in possession of data that could show whether or not tampering occurred
at Busang, the Toronto mining giant is bound to keep its data private under a confidentiality agreement
with Bre-X.
"If the question is: Can we compel the production of documents, whether they're confidential or not?
the answer is yes," said Larry Waite, director of enforcement for the OSC.
"I feel really uncomfortable talking about Bre-X specifically," said Waite. "But generally speaking,
under the Securities Act we have . . . the power to subpoena testimony and documents."
Forcing Barrick to turn over data would require a formal investigation order and Waite said he was
legally unable to comment on whether such an order had been issued.
Mining analysts have speculated that Barrick's analysis of ore samples obtained from Busang might
have turned up evidence of tampering by Bre-X.
If the rumor could be confirmed or disproved, Bre-X shareholders would be best served by getting
any relevant information into the open, analysts say.
"I believe that both Barrick and Placer [Dome Inc.] have information that could be material," said one
mining analyst.
Barrick and Placer, which was also an early candidate to become Bre-X's partner, are bound by
confidentiality agreements with the besieged Calgary-based mining company.
Barrick spokesman Vince Borg said his company is eager to share information but can't unless
ordered to by Bre-X or a regulatory authority such as the Toronto Stock Exchange or OSC.
"If they came to us, we'd like to comply with them," he said. "Under the agreement, we can't even give
[a report] to Bre-X and ask them to go to the OSC."
In the interest of shareholders, Bre-X should be pushing for the disclosure of any relevant data, said
the mining analyst.
"It wouldn't necessarily be definitive but it would certainly help," he said.
"The bigger the story gets, the more important the data," added Borg.
Mining analysts skeptical of Bre-X's claims of 71 million ounces of gold at Busang suspect Barrick
may have turned up placer-type, or alluvial, gold in the rock samples.
That would indicate that placer gold from outside the property had been added to Bre-X's bed-rock
drill cores.
Placer Dome spokesman Hugh Leggatt would not confirm if his company had received samples from
Bre-X.
But he stressed Placer Dome has none today.
If a regulatory request were made for information or data, Placer Dome officials wouldn't be able to
shed much light on the Busang riddle, Leggatt said.
"We don't have any information from any of the activities [involving Placer and Bre-X] that would
change what's in the public domain."
Teck Corp., another company that is bound by a confidentiality agreement with Bre-X Minerals, has
even less information to add, offered its chief executive Norm Keevil.
Keevil said Teck never received any ore samples and its geologists only had a preliminary look at
Busang more than two years ago when the project was not very advanced.
-- with files from Sandra Rubin/FP |
