Happy New Year Mr.C.
Looks like it will take a little longer to unmuddify the musification.
Nice to see the Financial Post print something usefull for a change.
Maybe they have a job opening for you there(OSC).Hear Torana is quite
nice this time of year.:-)
The miners, brokers, and lawyers on the task force seeking ways to avoid another
Bre-X have delayed their report for up to six months.
And fear is growing among many in the mining business the report might in the end do the wrong thing: write new laws when
what's needed is more police.
"If they come up with strict technical controls it will just kill the business," said Dale Hendricks, a Bre-X investor who raised
the first concerns about the company. "They need more scrutiny of the people behind the public companies."
The Ontario Securities Commission and the Toronto Stock Exchange set up the mining standards task force in August after
the collapse of Bre-X Minerals Ltd., a 200-million-ounce gold find in Indonesia that proved to be a fraud.
"The task force aims to produce a comprehensive preliminary report by yearend providing specific recommendations ...
related to the technical requirements for the conduct of mineral exploration programs by public companies and the reporting
and disclosure requirements," the TSE and the OSC said at the time.
While the year ends tonight, the report is months away, though no one yesterday would explain what is holding it up.
""They obviously want to get it right," said Rowena McDougall, a spokeswoman for the OSC. "And we at the commission are
very seriously understaffed. There are only so many things we can do at once."
Task force member Steve Vaughan, a Toronto lawyer, said, "The task force requires a lot of work, and a lot of work is being
done and progress is being made. Hopefully, everything that will come out of it will be positive."
Tony Andrews, executive director of the 6,000-member Prospectors & Developers Association of Canada, told the task
force this month he wants less regulation, not more.
The problem, he said, is a lack of enforcement of the existing rules.
"They don't have to beef up the regulations, they should beef up the enforcement, and the OSC can't do so because it has
been so severely short of resources," Andrews said. "Hopefully that's going to change."
The miners noted that the OSC has not replaced mining expert John Drury, who retired this year. Another mining expert left
two years ago. Drury continues to work as a consultant at the OSC and is a member of the task force.
OSC policy adviser Randee Pavalow said the commission has recruited mining expert Hugh Squair as a consultant to review
mining company prospectuses.
"We have done our best to hire people," she said. "I'm not aware of there being a need at the current time for any additional
people in this area."
To ease the workload in reviewing companies' prospectuses, Canada's four stock exchanges are working on a system they
call "mutual reliance." Under that regime, each exchange would have specialists in one area. For example, the TSE could rely
on an Alberta Stock Exchange expert to review oil and gas company filings.
Jack McOuat, a consulting geologist with Watts Griffis McOuat who helped write the Professional Engineers of Ontario
report to the task force, said the junior mining business will never be fully cleaned up.
"It's a high-risk, high-reward industry. You're not going to weed out all the rascals, just like in horse racing or lawyers taking
off with trust funds," he said.
John Postle of the mining engineering firm Roscoe Postle & Associates said the delay in the report is understandable.
"The volume of material they received would curl your hair and mine," he noted. "And it's all volunteer labor."
In his view, the main change needed is a rewrite of National Policy 2A, which governs the filing of reports. "The rules were
written eight to 10 years ago; they need to be updated," he said.
Postle added the exchanges should require all corporate filings be covered by the 2A guidelines, "so somebody can't come
along and say, 'I've got a deposit of 70 million ounces,' without proof."
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