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Gold/Mining/Energy : BRE-X, Indonesia, Ashanti Goldfields, Strong Companies. -- Ignore unavailable to you. Want to Upgrade?

To: william smith who wrote (27437)	11/1/1997 12:17:00 PM
From: Walter	Read Replies (1) \| Respond to of 28369

Marcos: Walsh is an idiot (always will be) and probably also a crook. Saturday, November 1, 1997 Busang camp had a 'salting shack:' book Bankruptcy beckons for Bre-X By SANDRA RUBIN The Financial Post Tampering with core samples at the Indonesian gold operation of Bre-X Minerals Ltd. was so open there was a "salting shack" right in the Busang camp, according to a new book. It also says Michael de Guzman - who died in a mysterious fall from a helicopter days before suspicion of fraud exploded on world markets - wrote several memos addressed to chief geologist John Felderhof that discuss finding ways to keep the gold assay results consistent. Erratic test results are often a clear tipoff to a salt job. Vivian Danielson, editor of The Northern Miner and co-author of the book Bre-X: Gold Today Gone Tomorrow, said she has obtained copies of de Guzman's memos that discuss "experiments being done to hide the telltale signs of salting." "It certainly refutes the notion that the dead guy did everything." Felderhof, whose role in the $6-billion fraud is a question mark, has been holed up at his Cayman Islands home since the hoax was exposed last spring. He has said through his lawyers he did nothing wrong. Danielson said it's not clear if Bre-X president David Walsh had any direct knowledge of what was going on in Indonesia. "In the early stages, Walsh was asking people: 'Should I bring my core back to Canada?' "But he purposefully distanced himself from what was going on. Normally, with a discovery of this size, a president of a mining company is all over this thing. I always thought that was strange ... He was just involved with raising money." Walsh has insisted he knew nothing about any wrongdoing and said he was devastated by the swindle. His lawyer said Friday he has yet to read the book, which will be on store shelves Monday. But Alan Lenczner disagreed with the conclusion the salting was done right at Busang. He pointed to an investigation commissioned by Bre-X and carried out by forensic investigators that concludes the tampering was done elsewhere. "To my knowledge, the salting did not take place on site," Lenczner said. "It took place in a warehouse at Samarinda, which is six or eight hours downriver by boat." Danielson, who wrote the book with geologist and Northern Miner staff writer James Whyte, said the Samarinda warehouse was not rented by Bre-X until last year. In the meantime, she said, gold was mixed in with core samples and tested at the camp's well-equipped sample preparation lab. "It was pretty big and quite sophisticated," she said. "It had everything. "In other words, they could do their assays before they sent them off for independent assaying. There's no question the salting started right on site." The building and its contents were videotaped by Nesbitt Burns Inc. mining analyst Egizio Bianchini during a tour of the site. Danielson said she was alarmed as soon as she saw the tape, which was broadcast on CBC-TV's show Venture. "If I had seen that [first-hand], I would have freaked. Had I known that had existed, I would have been shaken to the core. That meant they were preparing their own samples." Bianchini, one of Bre-X's biggest cheerleaders on Bay Street, has been named in several class-action lawsuits launched by angry investors. He has refused to comment on the swindle. Nesbitt Burns said Friday it would not comment on the book. Danielson said the presence of two metallurgists, Rudy Vega and Jerry Alo, should also have tipped people off. "You don't have metallurgists on site. Their function is to find the ways to take gold out of a rock. [They were used] to find ways to put gold into a rock. "They do not belong on an exploration site. There was no mine in production. There was no metallurgy. It's a red flag." Bre-X had 'salting shack:' book Eves plans big changes at OSC Weekly fund highlights Flicks from down East CANOE home \| We welcome your feedback. Copyright c 1997, Canoe Limited Partnership. All rights reserved. Please click here for full copyright terms and restrictions.

To: william smith who wrote (27437)	11/1/1997 12:25:00 PM
From: Walter	Read Replies (1) \| Respond to of 28369

If bsr is declared bankrupt, there is no need for new management or directors. Saturday, November 1, 1997 Bankruptcy beckons for Bre-X Busang camp had a 'salting shack:' book By CLAUDIA CATTANEO Calgary Bureau Chief The Financial Post Bre-X Minerals Ltd. will almost certainly be pushed into bankruptcy on Wednesday and if a group of Alberta and British Columbia investors have their way, so will its affiliate Bresea Resources Ltd. Separate bankruptcy motions - one from Ontario investors and one from those in B.C. and Alberta - will be heard Wednesday by Alberta Court of Queen's Bench Judge Robert Cairns. Both want what's left of Bre-X put in the hands of a court-appointed trustee and away from management. The Alberta and B.C. investors also want Bresea declared bankrupt so they can tap into its bigger assets. Investors lost billions of dollars last spring when Bre-X's Indonesian gold find was found to be a fraud. The two shareholder groups have different views about how the bankruptcy should be handled and who should be appointed trustee. Cairns attempted to deal with the "power struggle" in a hearing Friday by giving both teams equal status in Wednesday's proceedings. He will decide which bankruptcy proposal to support. A combination of the two is also possible. "I am surprised there is contention when everyone is trying to push the wagon to the end of the same trail," Cairns told the hearing. The Alberta and B.C. investors want to wipe out a side deal they say was "cooked up" without their involvement late Thursday by Bre-X president David Walsh and the Ontario investors. Walsh owns 14% of Bresea. The agreement would keep Bresea's current management in charge for up to 120 days. "There is no reason to leave Bresea out there, with $26 million [in cash] sitting in the courthouse. The creditors will be better served if Bre-X and Bresea go into bankruptcy," said lawyer Brian O'Leary, who represents the Alberta and B.C. group. "The effect of pushing Bresea into bankruptcy will annul the deal, and that's what we will be seeking" on Wednesday, said lawyer Clint Docken, who teamed up with O'Leary to represent Alberta and B.C. investors. The group has 115 shareholders from Alberta and 148 from B.C. "It's safe to assume that, one way or another, Bre-X will be bankrupt as of Wednesday," Docken said. The side deal has Bre-X agreeing to go bankrupt, but Bresea would continue to operate for up to 120 days. In that period, Bresea would call a shareholders meeting and elect a new board of directors. No current officers or directors would stand for re-election. Under the agreement, Bresea would continue to operate with three employees and pay office expenses of up to $25,000 a month. Another $20,000 would be earmarked for the cost of the shareholders' meeting and $50,000 for liquidating its subsidiary in the Netherlands. The deal was struck to give Bresea a chance to let its shareholders take control of its assets and determine its own destiny, said lawyer Larry Robinson, representing the Ontario group. Once the company or companies are put into bankruptcy, the trustee will liquidate the assets and distribute money to investors. "There could be early distribution of the cash assets that are already in court. The trustee will then pursue claims against the insiders from insider trading, and that process will take longer," Docken said. Bresea's assets include $26 million in cash, now in the hands of the court, assets in Indonesia, a building in Calgary and subsidiaries in the Netherlands. Bre-X has a US$5-million indemnity fund. At its peak, it had a market capitalization of $6 billion. Investors are seeking to recover assets through proceedings under way in Houston, in which Docken has joined Texas attorneys Paul Yetter and Lee Godfrey. "We have always taken the position that the best interest of the investors, as far as recovery, is in the U.S. class action," he said. Under that suit, investors are pursuing much larger claims against Bre-X principals, present and former directors, advisers, underwriters of stock issues and SNC-Lavalin Group Inc. Meanwhile, a lawyer representing thousands of Bre-X investors in B.C. says he now believes the Texas lawsuit poses shareholders' best chance at recouping their losses. David Klein said he has decided to align himself with the consortium of law firms being led by Yetter. Klein said he made his decision after reading an affidavit sworn by Ontario lawyer Harvey Strosberg, the lead lawyer in an Ontario-based action against Bre-X. Strosberg appears to argue the U.S. offers a superior legal climate for the pursuit of class action cases. Strosberg, however, has denied the views expressed in the affidavit apply to the Bre-X case. - with files from Paul Bagnall/FP Bre-X had 'salting shack:' book Eves plans big changes at OSC Weekly fund highlights Flicks from down East CANOE home \| We welcome your feedback. Copyright c 1997, Canoe Limited Partnership. All rights reserved. Please click here for full copyright terms and restrictions.