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Gold/Mining/Energy : SOUTHERNERA (t.SUF) -- Ignore unavailable to you. Want to Upgrade?

To: GULL who wrote (1242)	5/24/1998 6:31:00 PM
From: Confluence	Respond to of 7235

Mr. Gull, my responses: G: Without De Beers at present giving stability to the market in these very uncertain times I think that there would be major problems. If you look at the uncertainty in Indonesia , Japan , Korea and Russia to name a few think about the instability without their muscle. C: What has De Beers muscle got to do with instability in Indonesia, Korea, Russia and Japan? Their instability has a lot to do with outdated economic systems (see my earlier comments on the status quo) and corruption in business and government and little with diamond sales. I love diamonds, but they certainly are one of the commodities we could live without, or with less (see De Beers) G: As to the M1 saga: 1.De Beers and ? did the original work. 2.SUF (+ex-De Beers geologists) and ? make the 'find'. 3.If proper procedure had been followed there would have been no court case at all.Think about it. C: What does "?" mean? If this is some person or company, please acknowledge who they are and why you find this important now. Proper procedure according the SUF and the DME and the South African consulate in Toronto has been followed to the letter. This is the crux of what will happen next: Either Dr. Maduna invokes Section 24 or some other "transitional" measure, or foreign investors, at least miners, will be very nervous about doing business in RSA. G: Do you think that these heirs could have conjured up their case? C: I don't think they conjured up anything. However, I do think that the "heirs" did try to get a piece of Marsfontein only when SUF found it had potential value. That is human nature. But the government has procedures in place for just such an occurrence... G: How do you think the heirs felt when they found out about the M1? C: I imagine that they felt horrible that their ancestors had failed to clearly and correctly record the succession of the mineral rights. They were probably mad, disappointed and no doubt that has been directed at SUF. However, SUF didn't make the rules: The DME did. SUF worked according to these rules and so far, has been screwed. G: They approached CJ in January (8th) played open cards showed him all their DD. C: This is irrelevant due the rules and procedures as set out by the DME. Your anger is misdirected. G: I have no doubt that jobs could have been created etc...but DB will also provide jobs etc... C: But not foreign investment, not competition to invigourate growth. Look at the recovery of the US economy in the 90s after the stagnation of previous decades. The US government set about providing private enterprise with the setting for a recovery, but it was individual companies, people tired of getting beaten by the Asians and Europeans at their own businesses that did the work. Look at how telecommunications has changed and evolved, led by small American entreprenuers, since the break-up of ATT in the 80s. Does this give you any ideas on how to improve the mining industry in RSA? G: No-one asks the obvious.Why did SUF take such a risk when the knew what the value of the M1 was? C: A good question. Obviously they thought this would have been resolved months ago. G:The heirs were literally a phone call away. Why not negotiate a deal and start mining? C: See answer above regarding DME rules and procedures. G: How did they get to the $200,000 offer when the rest were offering so much more? C: The 980,000 Rand was put aside at the request of the DME in the form of a "trust" deposit, in case the owners of the mineral rights ever came along. This 980,000 Rand was deemed appropriate by the DME or they would not have accepted it. SUF was never in a position to make an offer. Word had it that representatives with connections to the parent company of De Beers were authorized to better any offer, so for SUF to negotiate, the "heirs" negotiator was to have had a mandate to make a deal, which she never had. At least that is how it was told to me. G: The whole thing was bungled and I don't know why when it was so obvious to a few of us? C: It wasn't obvious to everyone, although I know several shareholders of SUF who expressed their wish to settle the damn thing. Regards Confluence