Bre-X Minerals says it can sell Busang stake<\/p>\n
CALGARY (Reuter): Bre-X Minerals Ltd confirmed on Wednesday it
\nhas the right to sell its 45 percent holding in the rich Busang
\ngold deposit in Indonesia without offering a right of first
\nrefusal to its Indonesian partners.<\/p>\n
\"Bre-X's 45 percent interest in Busang Indonesian Gold JV is
\nheld by wholly owned Dutch subsidiaries. Bre-X is free to sell
\nits Dutch subsidiaries without a right of first refusal,\" Bre-X
\npresident and chief executive David Walsh said in a statement to
\nshareholders.<\/p>\n
\"However, there is no plan for such a sale,\" he added.<\/p>\n
Walsh said Bre-X remains committed to Bre-X's joint venture
\npartners and the project.<\/p>\n
\"Based on the latest resource calculations, the Busang
\nproperty contains at least 70.95 million ounces of gold -- making
\nit the largest and richest gold mine in the world. At today's
\nprice of approximately US$350 an ounce, the Busang property has a
\ngross economic value of $24.8 billion,\" Walsh said.<\/p>\n
He added that production costs in Indonesia are estimated to
\nbe roughly $75 to $95 an ounce as compared with $200 an ounce as
\na world average.<\/p>\n
\"Based on Bre-X's 45 percent ownership, the company's
\ncurrently estimated gross economic value in the property is $11.2
\nbillion. While we are confident that this figure could be
\nsubstantially higher, any such estimate is based on potential and
\nremains speculative,\" Walsh said.<\/p>\n
Walsh said the final joint venture agreement reached, which
\nawarded 15 percent of the property to Freeport-McMoRan Copper &
\nGold, 45 percent to Bre-X and 40 percent to Indonesian interests,
\nreflected the political, economic and social environment in
\nIndonesia.<\/p>\n
\"In the months leading up to the final agreement, various
\nthird parties conducted negotiations with the Indonesian
\nauthorities, from which Bre-X was excluded, which introduced a
\npercentage ownership mind-set that significantly reduced our
\nultimate negotiating leverage,\" Walsh said.<\/p>\n
\"Even though we discovered the gold fields of Busang, they are
\nof such extraordinary richness that the final deal had to include
\na 40 percent share for Indonesians to be competitive with the
\noffers put forth by other major mining entities and to satisfy
\ndomestic political requirements,\" he added.<\/p>\n
Walsh said Freeport, chosen by Mohamad \"Bob\" Hasan, was an
\nexcellent choice for the large, experienced partner in Busang for
\nwhich Bre-X had long acknowledged a need.<\/p>\n
Walsh also addressed a newspaper report that he pulled profit
\nfrom his Bre-X shares at a crucial time.<\/p>\n
He said at one stage last year, a false news report said that
\nBre-X's ownership in Busang was at risk, because of the
\nrevocation of a SIPP (preliminary survey permit) on August 15,
\n1996. The stock fell to C$17.<\/p>\n
\"The report in question neglected to include the fact that
\nBre-X's ownership and exploration rights were fully protected by
\nvirtue of the outstanding KP's (mining authorizations) which
\nsupersede the legal status of the SIPPs,\" Walsh said.<\/p>\n
\"Prior to this report, I made a decision to sell approximately
\nthree percent of my Bre-X position for personal reasons. I retain
\n97 percent of my Bre-X stock and remain the company's single
\nlargest shareholder. My desire to attain full value for Bre-X's
\nstake in the Busang deposit is, and will remain aligned, with
\nother Bre-X shareholders,\" Walsh added.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/bre-x-minerals-says-it-can-sell-busang-stake-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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