Bre-X does not show systemic flaw: Regulators
Bre-X does not show systemic flaw: Regulators
TORONTO (Reuter): Canadian securities regulators said on
Thursday the saga of Bre-X Minerals Ltd and its worthless Busang
gold find does not indicate "any systemic flaw" in Canada's
regulatory system.
Canadian regulators and stock exchanges have come under fire
since a report last week that said there was virtually no gold
worth mining at Bre-X's Indonesian gold site. It described Busang
as a massive fraud.
Bre-X stock -- once worth over C$6 billion -- sank to pennies
a share before it was delisted from the Toronto Stock Exchange.
"The Bre-X situation does not indicate that there is any
systemic flaw to the Canadian regulatory and self regulatory
system," Canadian securities regulators said in a joint statement
on Thursday.
"However, it was agreed that a review of the mining finance
regulatory process is appropriate and that all interested sectors
should review all circumstances relating to their areas of
responsibility to correct problems that may be identified," the
statement said.
Aside from officials from the Ontario, Quebec, British
Columbia and Alberta securities commissions, the meeting also
included representatives from the Toronto Stock Exchange, mining
associations, government officials and the Investment Dealers
Association, the brokerage industry's self-regulatory body.
Australian observers have criticized Canada's lax mineral
reporting standards and predicted the Bre-X scandal will pressure
Canada to adopt a tighter reporting code.
Meanwhile, Bre-X said in Jakarta yesterday it was winding down
Indonesian operations, ending a tumultuous chapter that began
with its 1993 purchase of the now-worthless Busang property.
"We are winding down all our activities, that include gold and
copper exploration activities in Aceh and North Sulawesi," Bre-X
financial officer Bernhard Leode said.
He said exploration in Aceh, on northern Sumatra island, and
on northern Sulawesi island had been carried out by Bre-X
affiliates Bresea Resources Ltd and Bro-X Minerals
Bresea, which owns 22.7 percent of Bro-X and 22.3 percent of
Bre-X, and Bro-X were awarded contracts of work last month by the
government to explore for and develop mines.