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

To: alan holman who wrote (28016)	7/28/1998 12:05:00 PM
From: Mr Metals	Read Replies (1) \| Respond to of 28369

Bre-X Minerals Ltd - SNC-Lavalin responds to Financial Post article on Bre-X Bre-X Minerals Ltd BXM Shares issued 219,103,330 1997-05-07 close $0.09 Tuesday Jul 28 1998 See SNC-Lavalin Group Inc (SNC) News Release Mr. Robert Racine of SNC-Lavalin reports SNC-Lavalin finds it deplorable that an article published in the Saturday, July 25, 1998 edition of The Financial Post inappropriately uses excerpts from an affidavit of David Walsh, the late former president of Bre-X, regarding the mandate of its subsidiary P.T. Kilborn Pakar Rekayasa in respect of the Busang gold mine in Indonesia. By doing so, the newspaper has disseminated incorrect and incomplete information. By proceeding in this manner, The Financial Post is engaging in sensationalism and conducting a trial by media. It is showing bias by relying mainly on partisan statements, on the one hand of Mr. Walsh, and on the other hand of two lawyers acting for plaintiffs, Paul Yetter and Harvey Strosberg. As for excerpts of Mr. Walsh's statement, contained in an affidavit given in difficult circumstances at best, they are incorrect; as appears from the contract entered into between P.T. Kilborn and Bre-X, P.T. Kilborn did not have the mandate to conduct inspections of Bre-X's work nor did the prefeasibility study or intermediate feasibility study issued by P.T. Kilborn purport to confirm Bre-X's results or methodology. Furthermore, it is obvious that the interests that Mr. Yetter and Mr. Strosberg have in the outcome of the lawsuits undermine the objectivity of their statements. It is important, therefore, to recall the facts. P.T. Kilborn, an Indonesian company created in December of 1991, was an 80 per cent owned subsidiary of Kilborn Engineering Pacific, which itself was a wholly owned subsidiary of Kilborn Holdings. The latter company became Kilborn SNC-Lavalin in March of 1996 when it was acquired by SNC-Lavalin Group. Well before P.T. Kilborn ever became in any way involved with Bre-X Minerals, Bre-X had already undertaken, starting in October of 1993, an extensive exploration program at Busang and had already made public the drilling and sample assaying results relating to this exploration program. Therefore, the fraud in respect of Bre-X's exploration program - which has been described in the Strathcona report as being of a scale and over a period of time and with a precision that is without precedent in the history of mining anywhere in the world would appear to have been already well under way at such time. It was not until July of 1995 that Bre-X, through its affiliate PT Westralian Atan Minerals, retained by contract P.T. Kilborn for the first time, to conduct a prefeasibility study and subsequently an intermediate feasibility study on the basis of exploration program data produced and supplied by Bre-X, its employees and/or consultants and subcontractors, as clearly disclosed in each of those reports. Conducting such studies in respect of a mining project, which requires modeling of the orebody and basic design for the construction of the infrastructure and production facilities, is an aspect of a mining project which is separate and distinct from the exploration program. P.T. Kilborn carried out its mandate in accordance with professional standards based on geological information and drilling, sampling, assaying and metallurgical data furnished by Bre-X. Reputable metallurgical consultants retained by Bre-X to conduct various metallurgical studies did not in their reports, submitted by Bre-X to P.T. Kilborn, draw attention to any anomalies with regard to the characteristics of the gold particles found, nor does it appear that they informed anyone that there was reason to suspect that a fraud had been and was being perpetrated. Moreover, when P.T. Kilborn provided copies of its reports to Freeport-McMoRan Copper & Gold at the request of Bre-X, representatives of Freeport-McMoRan did not put into question with P.T. Kilborn the work which the company had done, nor did they indicate to P.T. Kilborn any suspicion of fraud regarding the Bre-X data before proceeding with their own exploration program. In short, the source of the problem is not and was not the work of P.T. Kilborn but the data provided by Bre-X to P.T. Kilborn. Once again, as this is not the first article of this nature published by The Financial Post on this subject, the newspaper is acting irresponsibly in engaging in sensationalism and conducting a trial by media of SNC-Lavalin and its subsidiary. (c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com