The 53 Million Ton Golden Mountain in Indonesia That Shocked the World
In 1993, Indonesia shocked the world with claims of a massive gold mountain weighing 53 million tonnes located in East Kalimantan. However, this remarkable discovery would later prove to be an elaborate deception.
The story began when a group of researchers from Canadian mining company Bre-X claimed to have discovered a mountain of gold in Kalimantan. They estimated the mining potential could reach 53 million tonnes. According to a Tempo investigative report from 30 November 1998, Bre-X was a small-scale operator that operated modestly.
In 1993, the company’s geologists, led by expert John Felderhof, undertook a 12-day expedition through the pristine rainforests of East Kalimantan to locate an area they identified as rich in gold, called Busang. Following their exploration and assessment of the area’s potential, the company issued an open letter to investors describing the promising future of Busang and the wealth investors could accumulate from the project. The company announced that the Busang land contained a mountain of gold worth 53 tonnes.
The news immediately captured global attention. In Canada, Bre-X’s share price soared to record highs. BBC International reported that the company’s value transformed overnight from minimal to 7 trillion rupiahs. In Indonesia, top government officials and business tycoons were eager to participate. Those close to President Suharto, such as businessman Bob Hasan and Suharto’s son Sigit Harjojudanto, became involved. Through their respective companies, both gradually secured control of mining areas in Busang. By 1997, Bob Hasan had acquired 50 per cent of shares in PT Askatindo Karya Mineral and PT Amsya Lina, which controlled Busang I and Busang II mining operations. Sigit was even persuaded by Bre-X with a monthly payment of 1 million US dollars to have his company, PT Panutan Daya, serve as a consultant in Busang.
Initially, everything proceeded smoothly. The involvement in the gold project amid the economic uncertainty of the 1990s offered a glimmer of hope. However, conducting business in Indonesia proved challenging for Bre-X. President Suharto required foreign companies to share shares and cooperate with the government. In the Busang case, Suharto designated PT Freeport-McMoran as the mining company representing the government. It was from this point that the true nature of the Busang gold began to unravel.
As an established company, Freeport implemented strict procedures, including field verification. They were required to collect samples to test in laboratories and confirm whether the soil genuinely contained gold. Freeport’s team moved into the area to conduct their investigation.
Unexpectedly, on 19 March 1997—the same day Freeport conducted its verification—news broke that Bre-X’s boss had disappeared. The boss, Michael de Guzman, was Bre-X’s Exploration Director. Guzman reportedly died by suicide, jumping from a helicopter seat during a flight from Samarinda to Busang. A suicide note was also discovered.
On the ground, a search and rescue team found a body believed to be Guzman’s. The body was taken to the Philippines for burial. However, as a journalist, investigator Bondan Winarno had different instincts. He was convinced the body was not Guzman. After conducting investigations extending to Canada, his conviction proved correct. The physical characteristics of the body did not match those of Guzman, leading to the conclusion that Guzman was still alive and had been deliberately hidden.
This incident appeared connected to the Busang gold case. At the same time, Freeport released its verification results: the Busang land contained no gold. Various independent researchers also reported similar findings. No gold was found in Busang rock samples from 1995 to 1997.
The news immediately shocked Indonesia, as it meant that President Suharto had been deceived. Bre-X’s shares plummeted. Investors were furious. Some even held Bre-X boss David Walsh hostage demanding refunds. It took considerable time for the case to settle, though it was never fully resolved and left many unanswered questions, particularly regarding Guzman’s disappearance.
According to BBC International, after these events, Guzman vanished without a trace. His family still has no knowledge of his whereabouts. However, the family believes he is still alive, allegedly hiding in South America.