This is the UFO landing padthat we're standing on. It's circular. It's got a map here ofCanada. Canadian flags above us. What is the significance ofthe UFO component of this? So there's speculation that at somepoint St Paul actually had a visit. Really?Yeah. There's no definitive proof, but that's. That's part of the town gossip. Thisis the lore of St Paul we’ve had situations where the unexplained has occurred.Like What? We actually had a citizen in ourtown who would go out to farms and investigate cattle mutilations which was thepredominant theory amongst the UFO community..
Troy Siemers is showing mearound his hometown of St Paul. It’s a small prairie town with a populationof about 6,000,a few hours from Calgary. Back in 1967, cattle were found herewith their organs neatly removed… rumours spread it was the work of aliens.People believed their town was being visited by extraterrestrials and they raised moneyto build a 2.4 metre concrete pedestal – a landing pad for the UFOs.Today, a row of flags, to welcome any other worldly visitors,flap loudly in the Alberta wind, St Paul has this lore in the UFO world tothe point where I mean people have made pilgrimage to St Paul.Really,.
St. Paul really sells itself as the town withthe UFO Landing pad… a picture of it is on their website… and if you search “what isSt Paul known for?” the UFO stuff comes up. But back in the mid-90s the town thatwanted to believe the truth was out there, put it's faith in something on Earth, gold. There’s gold fever on the streets ofSt Paul. Everyone is talking about Bre-X a small Calgary mining companythat’s struck gold half a world away and even though the mines are inIndonesia a lot of the wealth is right here in St Paul. Do you know any newMillionaires? Yes a few I’d say about five. This small community in the middle of nowhere suddenly became the hub of activity for amining company with a motherlode across the world.
In Indonesia, like what St Paul, whywas this town so specifically targeted? In the mid-90s St Paul believed so hardin jungle gold that these streets were thought to have the highest concentrationof Bre-X investors anywhere in the world… Small business owners, retirees,“moms and pops” with a little extra to invest… they went all in on Bre-X.Some thought the Bre-X gold mine story sounded too good to be true… fool'sgold… and these two camps – believers and non-believers – were on a collision course.I’m Suzanne Wilton and from the BBC World Service and CBC Podcasts, this isThe Six Billion Dollar Gold Scam, a story about the lengths people willgo to in pursuit of getting rich..
And how greed can obscure the truth…This is Episode 2: The Believers. Highway 881 takes you right into StPaul. The route passes by a tall red brick church and a clock tower, but therest of the buildings are low and boxy. Overhead traffic lights and signs forfast food joints light up the main street. Decades on … emotions are still rawin this town.. I’ve been warned people won’t want to talk about Bre-x … andhow the gold rush all went down here. It all started with a man from a local bank,justan average guy who came across a hot stock, and told his friends and neighbours.So my understanding, it was the gentleman at the bank and he happened to know Mr. Walsh.But I mean, I found it very ironic that something.
That dramatic came to St Paul of all places.So there must have been some sort of connection. There must have been a tactical connectionbetween the way Bre-x started from very small roots to suddenly getting the attention of a smallcommunity in the middle of nowhere. I don't mean that as a slight. We're 2 hours from Edmonton.We are not really that connected and back in 97, even less so. Right. I mean, we're not theage of the Internet and texting and video chats and all that lovely stuff. So back then,to drive to the city, you really had to have a purpose. You know what I mean?So somebody knew somebody? Somebody in Bre-X told this guy atthe bank, and this guy brought in a small cadre of like maybe three or four wellconnected families, and then they expanded.
To the next set of connected families. And itjust kind of spread and spread, and it oozed. St Paul didn’t have a wealth of informationabout Bre-X other than it was a mining company that had discovered an amazing thing andyou trusted a person who at that point, it was my understanding that the guy at the bankwas not actually a resident of St Paul that long. This town is still full ofpeople with Bre-X stories. Colin Porozni runs a brewery in St Paul andI've been told he might have something to say. Hellooo, good are you.Colin my name is Suzanne and I am from Calgary and I was a journalistfrom the Calgary Herald and I worked on Bre-x. Can we chat with you?Sure yes. Sorry about the.
Place, it's a mess, I’ve just got back, Iwas in Chicago until midnight last night. Were you there on business?No, it was a quick getaway. Before the rest of the world caught on to Bre-X,St Paul was already in the grip of gold fever; they got into the game when thecompany’s stock was just pennies. In 1993 the stock started out at 20 cents a share.It's a rags to riches story which has caused a lot of excitement here in St Paul.A hot tip from a local banker has made dozens of people rich at least onpaper and at least a dozen more shaking their heads. “I didn’t hear about it soon enough, ifI would have I would not be standing here now. If you’d listened to this local banker’s hot tip,jumped on the stock in the early days and kept a.
Hold of it you were now rich.But some people – like Colin- made a different choice..I bought a vehicle instead and we call it the Bre-X truck and itwould have been worth about $300,000. That's Colin talking to CBC news about the choicehe made… to buy a truck instead of Bre-X stock. I was quite young and was out of University afew years and we needed to buy this vehicle. I came home and talked to my wife and I saidlook there’s this opportunity and she is a more logical thinker than me and she said absolutelynot we should be buying the truck instead. On that same day that I bought that truck, ifI would have put the exact same amount of money into Bre-X stock I believe it was goingto be worth about $3 Million at its peak.
With a population of 4,800, one-in-26residents became a Bre-X investor. But despite the public frenzy, most people inthe town kept their Bre-X windfall a secret. Some of the winners used it as a springboardto start new business, retiring early, it definitely had a unique impact onthe town. Personally I know of 15 – 20 people who invested. There seemed to bea lot of people who were talking about it, but whether they actually invested or not.You hear other stories who invested but never mentioned a word about it to anyoneand carried on with their normal lives. Were there folks excited like they’dwon the lottery? And talking about it. Absolutely, I don’t know how much workactually got done throughout that period.
Because people were constantly on their computerschecking stock quotes and a t that time I think you may have also had to phone in to get stockquotes so you were phoning in for stock quotes. They would have been in closecontact with stock brokers, a hotline for inexperienced investorsto advise them on their next move. Again the newspapers, people used to joke thatyou’d take the equities part of the newspaper for a fire starter or for kitty litter or somethinglike that and now it was the most sought after part of the newspaper the stock section.How did word get around? It is a small town so there is the coffee shoptalk, talking with co-workers or sitting at a hockey game or a hockey practice and watchingyour kids play and there’s chatter there too. It.
Did not take long for it to spread like wildfire.Did it seem strange that his small prairie town in rural Alberta would be so interestedin a goldmine in the middle of Borneo. No it’s human nature to begreedy and want to get richer. One Banker, with a few hot tips: youcan see why so many people jumped on Bre-X stock… I’d really like to findan investor who will speak to me. Well this is really frustrating. I've come allthe way to St Paul hoping to talk to some folks, I've tried three people none of them arewilling to talk. It's 25 years later and people are still uncomfortable with talking aboutthe rags to riches. I am optimistic though and I am going to try again tomorrow and I’m hopefulthat someone is going to share their story.
This is just a small town of farmersand regular Joes. People were excited in the community because peoplehad got in on the ground floor. In an eatery, a place where townsfolkonce swapped trading tips and gains over coffee…I’ve finally found a couple whoinvested and who’ll speak. They don’t want to use their names because in towns likethis they say ‘loose lips sink ships. For our generation, everybody was gettin inon it and what are we going to get from it. Everybody wanted to get rich. Everyonewas looking to make a quick buck. The working class person wanted to have money toretire and bla bla bla, that’s what i think. We want to believe , we want to believe sometimesso much, that we are blinded by the truth.
If it's too good to be trueit's too good to be true. You gotta understand the cultures ofsmall communities and where people are from. We are not big risk takers,we invested a bit of money and we lost money. We did not invest a lot just 200 bucks, Ah okay so one of you won and one of you lost? Yes. When it upped five bucks I cashed out.I could have made a lot more but I cashed out probably the second month that it was goinglike this. I said I am taking my money. Traders at the Alberta Stock Exchangehave said they’ve never seen anything like it. From a low of a dollar 90 toa high of 170 dollars in just one year. You didn’t have to be richto invest – St Paul’s small.
Town coffee groups pooled together to buy stock. As those early investments skyrocketed,Troy remembers people getting stoked up. Even when Bre-X was just starting, if theyall pitched in $100 and got in at the bottom with their little group of pooling. If that’s15 gentlemen that’s $1500 on a penny stock, suddenly that $1500 is probably $150,000.So these guys are sitting back and having coffee and going WOW can you believe what justhappened and the vibe was like that. People’s thoughts were like this is unbelievable, thisis going to be a gold mine, this is fantastic, I can’t believe this is happening thislittle community suddenly went Yayyyyy we have finally hit the big time, a jackpot,suddenly everyone in town was going to be rich.
The press descended on St Paul to photographthe town’s millionaires – and where better than the UFO landing pad.A photo exists of five grinning men standing there in a row.I had a copy and asked Troy to take a look at it. It's hard to say who is really in the photo. Ihave speculation that it’s certain key members. It's incredible looking at all these old articles.St Paul! Can you tell me about this one?Sam Grier is rifling through his collection of old articles and he’sjust come across that same photo. Like Troy, he can’t – in fact -won’t name the people in the shot. I better not too much, someof the guys are a little bit.
Sensitive about it. All of these guysmade money out of it to be frank. I’m meeting with Sam in my home cityof Calgary, Canada. David Walsh, the CEO of Bre-x, hired him in 1994 to work intheir Calgary office and liaise with investors. It was in the basement of the Walsh’s family home.Jeanette – David Walsh’s wife – ran the office and their son Brett also worked there.Back then it felt like a family business. When Sam joined the company it wasbefore any sniff of a gold rush. So they just picked your resume.They just picked my resume and they interviewed me and I got along with them. I reallyliked David. That’s where things got started. It was a cool project they were working on. I meanlooking for gold in Indonesia was pretty neat.
In those early days, David Walsh wasgoing around Alberta promoting Bre-X stock. One of his roadshows took him toEdmonton, the nearest city to St Paul. It was this on-the-ground promotion thatsparked a groundswell of interest. Then there were the press releases describingwhat was happening in Busang, Indonesia. The Drilling results that came in to the Calgaryoffice, there was a nice flow of news coming out. So as news is coming out, analysts are gettingexcited, word of mouth starts to spread and the press is excited and it just helps to fuel the…Everything fueled it, like the fantastic drilling results, you had the media pumping it up, youhad brokerage analysts that really like it, you had a gold market that was gettingstrong, it was the perfect catalyst.
Sam spent much of his time speaking withshareholders – on the edge of their seats, holding on for dear life, as the drillingresults kept getting better and better. Early 1995 about January or February95 it started to gain lots of momentum and really took off midway through 1995.In July 1995 a press release was issued stating the discovery of possibly the largestpure gold deposit ever found, in Indonesia. Then in October, the projection was upgraded -mining analysts estimated the deposit contained more than 10 million ounces of gold.Bre-X stock doubled in a week. The next press release topped even that – it wasbeing reported that the Busang project had the potential to become one of the world's greatestgold ore bodies. Shares continued to soar.
People wanted to get updates ona regular basis so our job was to make sure that everyone got their pressreleases when they came out and what I will say the management made sure we stuckto the press releases when they came out. David Walsh hung on every word coming outof the jungle and rolled out press release after press release. These were devoured byanalysts who created financial reports for investors, bankers and journalists.By January 1996,the stock hit $155 a share… making Walsh a very rich man.His fortune was estimated at $250 million.” Those who had held on to their penny stock werenow very rich – well at least on paper anyway. 1996 was a glorious year for thecompany. That's where they hit.
Their high that would have been August.You know in the Calgary office we all believed it was going to be the world’s biggestgold deposit. We just saw wealth created from it. Bre-X pumped out information at full throttle.This was the very early days of the internet with clunky dial up modems. Alongside those statements,Bre-X.com featured an anonymous narrator whose job seemed to be to supplement hard facts withtantalizing hints at future developments. Internet “chat boards” dedicated tostocks and shares were flooded with speculation about Bre-X discoveries.Here you could find a number of regular contributors talking the company up. Theywent under pseudonyms such as “Drumbear”, “Dick Nada” and ‘BigDude’. They were just kids in their.
Underoos in their parents basement playingaround with the internet but there was a lot of wrong information going on out there.David Walsh’s son Brett was in charge of moderating the Bre-X chat rooms.He was a pretty straight laced kid. I remember he would really just stick with the pressrelease and say this is what was reported and this is what you said, they are two different things.So how important were the chat boards at the time? They were just starting to pick up. Itwas really the birth of all that stuff. People who had a short term position on a stockwould put out a false rumour on the internet and it was not just Bre-X or another company, yep thiscompany has found the world’s best deposit next to Bre-X. Their stock would go up and someone wouldrealise they have just made that up and posted it.
This kind of rumour-mongering was illegal fora company to officially share, but here in the information superhighway, there was no regulation,except that enforced by the chat room moderator. The news media articles started quotingthese erroneous things on the internet. It was so new and I don;t think anyone knew how toregulate it. It was just kind of the wild west. While Brett was struggling to moderatethe chat rooms his Dad, David Walsh, was fending off negative news stories – theoccasional analyst raising the question whether this could all be too good to be true[63] .Carefully timed reports of tantalising new information coming out of Busang were hissecret weapon, drowning out the naysayers. During that time, journalist RichardBehar was interviewing Walsh for a.
Fortune Magazine article. The Bre-X CEO wasobsessed with controlling the narrative. Hi it’s Richard Behar how are you?How are you doing? I am just in the middle of putting outa press release, can I get back to you? I do need very much to talk to you. Do youknow what kind of stuff is flying around? Yeah I know that’s what I’m putting out in alittle press release. I’ll get back to you. Okay, thanks. Whatever the question or the concern, the answerseemed to come from the Bre-X publicity machine. Richard, I hope you got the, DavidWalsh, I hope you got the answers on the questions and the press release.Some unanswered questions I have for.
You now as per item 17 the datewas September 4th 96 faded out… Bre-X believers were everywhere.Many were unquestioning – just happy to ride the rollercoaster upinto the stratosphere.But there were some people who weren’t satisfied – theyneeded to see the gold for themselves… I had a friend of mine, a trader with me atthe time. And he was on the equity desk. And he said Warren, you got to take a lookat this, this really crazy gold stock. Warren Irwin, is a hedge fund manager and a wellknown figure on Bay street – Canada’s banking and money corridor in Toronto’sdowntown financial district. He’s on business in Calgary and hasagreed to meet me in the very average.
Downtown hotel my producer is staying in. I doubt it’s the kind of place a multi millionaire like Warren would usually hang out. I made my bosses a fair amount of money trading other stock so we approached the my partner andI about possible taking a position in Bre-X, they weren’t super keen on the idea so at the timeI said if you guys aren’t can you let me trade it personally, so he said knock your socks off. Warren is clean cut with piercing blue eyes – He’s freshly shaven – not a darkhair out of place. Because of his height, broad shoulders and air of wealth about himhe’s an imposing figure in his signature dark navy suit. Exactly what you imagine anineties hedge fund manager to look like. And he’s been running money inBay Street for about 23 years. .
It was while Warren was a director ofspecial investments at Deutsche Bank, Canada that he first came across Bre-X. He kept a careful eye on the stock price but also the temperature on the ground. He was anactive member of the Bre-X internet chat rooms. This was pioneering, this was the first timethere had ever really been a chat session with any significant stock. THis was veryvery new and it was very fascinating that you could get so many opinions and informationshared online. Back then it was so novel. At the beginning, Warren believed inBre-X just like anyone else. He settled on investing $250,000 at 18 bucks a share.All of his cash was ploughed into Bre-X stock. I felt pretty good. Well, there's going to be anabsolute fortune on it, because if you know and I.
Was believing the numbers were true, I knew thatthis was going to be huge. And what's interesting at the time, the greed machine was working moreso than I've seen since. This is right after Robert Freidland had founded Diamond Fields andhe just sold that to Inco for 4.3 Billion dollars. Robert Freidland was a mining financier andhis discovery of the biggest nickel deposit in history had the mining community on ahigh and bay street sloshing with money. You just had 4 billion dollars spread aroundBay street and everybody had all this cash. And they’re saying this was great, let's do it again.But they didn't realise big discoveries don't come around too often. But sure enough this isthe next big thing and a lot of people rode the money right into Bre-X. So there wasa frenzy and a sense of greed that I have.
Not seen since in the markets. The levelof greed back then was just unbelievable. And the front page of the Globe and Mail,the Financial Post, were all about Bre-X. They were jumping all over this and pumpingit too. It was, pretty incredible times. What role did that play, do youthink, in the excitement of… Throwing gasoline on a fire? For sure,yeah. Between the press getting involved to legitimise it and with a lot of investors whojust made a pile of money with Robert Freildland, there was money, there was greed,there was a sense of legitimacy and the numbers being spouted were just huge.To what extent did the actions of the analysts in hyping the stock, you know, contribute to this?Well, the key thing about the analysts,.
Especially from any of these big banks,itgave a significant number of investors, a high degree of comfort and that's why, in part, theinstitutional investors also got involved in this. After its meteoric rise in the early monthsof 1996, Bre-x hit the big league in April as it graduated from the Alberta Stockexchange onto the Toronto Stock Exchange. The company’s price jumpedto a new record of $184, and by May there were 20 millionBre-X shares at $286 a share, a very high price; big Canadian banks andmajor companies rarely reach this high. If, like Warren, you’d bought shares at20 cents you were now very, very rich. Then before you know it, as you're well awaretoday that there were a number of institutions.
Started jumping in. Big, big capital startedthrowing money at it.And before you knew it, it had a $5.6 billion marketcap and pretty exciting times. Market cap means market capitalisation- it’s essentially a valuation of the company's worth.At the peak for me, I had $5.6 million dollars personally in it and Iborrowed $1,000,000 thinking it was prudentI was, early thirties, 31, I think it was 30. And thereI was sitting there rocking and rolling. Yeah. Warren was a diligent investor. He was onthe phone night and day talking to anyone he could in Indonesia who had Bre-X intel.He racked up $1500 phone bills each month! I’d built up a very good contact base inJakarta. Probably the best contact I had.
Was John McBeth. He worked for the Far EasternEconomic Review at the time. He's probably one of the most seasoned and experienced andrespected journalists in Southeast Asia. And we struck up a relationship and it worked outbasically that he would share with me some of the gossip he was picking up in Indonesia, and I'dshare with him all the latest gossip in Toronto. In August 1996 Warren heard about a tour of theBusang property for analysts from big banks. This was his chance to see the site for himself.With so much invested in Bre-X, Warren wanted in. But there were a limited number of places.So I tried to get on one of their first property tours and I was told repeatedly from their Calgaryoffice that there was no room on the trip and I said, you know I'm just going to fly to Jakartaand it's going to be way tougher for them to.
Say no to me if I'm sitting in front of theoffice manager in the office, in Jakarta.. The office manager in Jakartawas a guy named Greg McDonald. I took him out for dinner and he assured meWarren we have three helicopters going there and they were all full and I said, don't worryabout that. I'll get my way there. No problem. I've already figured out the river system.I figured I could get a high speed riverboat and get some guy to take me up the MarharkumRiver, up to one of the ports, or whatever. And then what I would do, I'm an experiencedmotorcycle racer and I would buy a motorcycle from one of the locals. I find in Southeast Asiayou throw around enough money, things happen. Warren wasn’t used to being told no. Then Greggave him a sliver of hope, he told Warren he.
Should go to Balipakan in Southern Borneowhere the two main guys: John Felderhof and Mike De Guzman were giving a presentation.So I jumped in a plane and there I am in the southern side of Borneo with zero permissionto go on site, but had this backup plan at throwing a bunch of cash at some local peopleto get me to where I need to go. So I'm there that night.” Oh, hi, John. ‘Hi any chance ofme getting a helicopter tomorrow morning?’ ‘Sorry Warren they’re all full’. Saw thepresentation and we went out drinking that night. But that night I went out playingpool with the head of the assay lab. His pool partner was John Irvin. This guywas the next best thing to grilling Mike De Guzman and John Felderhof directly.The assay lab Irvin ran was where the.
Core samples of rock drilled from Busangwere taken to be analyzed. Assaying is the process of determining the amountof gold present in a mineral deposit. Warren knew John Irvin would havethe most up-to-date information on the amount of gold coming out of the mine.You know, this is tropical heat and we're drinking beers and he's sweating profuselyand we're shooting pool or playing pool. And he looked a little nervous. And I saidto him, I said, just for fun. I said, John, there's gold there, isn't there? And he nearlyjumped out of his skin. This is a little odd. Hmm. John Irvin’s reaction to Warren’squestion, could very well have been just one of surprise. After all, everyoneknew there was a LOT of gold in Busang..
The next morning, I woke up bright andearly. Got my bags packed. Hey, John. Hey, Mike. Any room in the helicopter?Well as luck would have it there's one spot on one of the Hueys going in.So I got jammed in as a six foot six guy jammed in the last seat on the sittingside of this Huey going into the site. And we're flying over, you know, flyingover jungles that have been cut down by the logging companies. And you'reseeing the red mud in the rivers as the soil doesn't hold the moisture anymore. So we landed in Busang and I got a bunk to stay in one of the rooms with one of the mining analysts.I go back to my time out there and I reflect on you saying oh I’ll just get in there butit’s not easy Warren it's not easy to get.
There so it's incredible that you hadthis fortitude to just be able to go. Why were you so intent on going, though?$5.6 million of my own money. Trust me, when you have that much you're doing anythingyou can to make sure you know what's going on. So I had 5.6 million reasons to get off my buttand go to the middle of some godforsaken jungle. At Busang, Warren and the other bankerswere flown by helicopter around the property to visit various drill locations.One of the things important to me was to see who was running the drills, they were Australians.THey were buying in obviously otherwise they would not have been there. But the issue, of course,then was the gold was you couldn't see it with the naked eye in the core. Right. So there's noway even an Australian driller would have known.
Whether they're drilling, you know, nothingor something.I looked around and the locals were building houses all around the propertylooking for work. Building shacks. So okay the locals are bought in. Okay, that's a good sign.We are talking about a very remote location in the middle of the jungle,this is indigenous people, with traditional ways. Tell mewhat your experience was there? I imagine they were local Dayak and they wereworking away building houses. They were believers. Can you describe the village?They were putting up shanty towns around the front gates because theywanted to be there first for any jobs. When Warren finally got in front ofMike De Guzman and John Felderhof,.
He watched them very carefully.I remember one of the mining guys asked Mike whether he could get somesample core to take back and I remember what Mike did. Mike turned away from him, hada whispered conversation with Felderhof and then they went back, got some core and theygave us a bunch of core. That was a little sketchy. Why would they have to have a privateconversation? Just give us some stupid core. And there were other things that gotWarren’s spidey sense tingling. When you drill a core you end up with a big pieceof rock. You normally split this in two, so you can send one half to the assay lab and holdthe other as back up. This means if you later need to double check your results, you can splitthe back-up in half and ship that to the lab..
It’s called “twinning” and it’s standardprocedure in mining exploration. But Felderhof and De Guzman were doing something different.They were doing skeleton core which meant every metre they were keeping alittle two or three inch piece. So that's not as good away to keep backupso I asked Felderhof why are you doing this not versus the traditionalway of splitting core and he said because gold is so nuggety we want to makesure we have a bigger sample as possible so I said to John when are you going to maketwins for the holes, that was John Felderhof, he says ‘we will be twinning the holes this fall.’That fall came and went and there was no sign of twinning holes that did notmake me feel super great.
Warren left Busang with some concerns,but on balance he still had confidence in his $5.6 million investment.But soon after getting home – and completely by chance, he bumped into a seasonedexploration mining geologist named Dale Hendrick. I ran into him in the elevator in mycondo building and I was reading the front page of the Financial Post and it saidBre-X, you know, millions and blah, blah, blah. I'm reading this and I go, Yeah,what do you think of this? And he goes, Oh, yeah. He says. A lot going on in the miningbusiness. I said, ‘I just came back from here.’ And he said, Really? You and I need to talk.And so we grab some lunch and this old timer sat down with me. We live in the samecondo building as luck would have it..
Then he started explaining to methat John Felderhof is a crook. Dale Hendrick seemed credible: he'dspoken to Australian geologists who’d explored the property before Bre-X.He told Warren that those guys were convinced there was absolutelyno gold to be found in Busang. They had tested it all.I said why don't the Australians tell the world that this is a scam? Oh no,they're not going to do that because they're making way too much money on this.There are somany people in the mining business that knew there was a scam right from the beginningthat kept their mouths shut. And I said to Dale, if the Australians aren't going to sayanything, I said, What are you saying? He goes,.
I'm telling the majors who I know that this isa scam and they’re thinking I have three heads. But could Warren trust Dale?At this point the major mining companies such as Barrick Gold, Placer Dome and FreeportMcMoran were all eyeing up Busang. Bre-X – even then – was still a junior mining company.It’s the junior mining companies that do the exploration and then the major mining companiescome in to take the gold out of the ground. While a handful of people likeWarren were raising red flags, others dismissed scam rumours as dirty tricks.If the majors could drive the Bre-X share down, they wouldn’t have to payso much to buy their way in. I was concerned that Dale was actuallyworking for one of the majors. And you.
Have guys employed by the big mining companiesrunning around telling people it's a scam to keep the price a little bit lower than would.And there's me 31 little old me 32 year old Warren trying to think, thinking this isa scam or this could be a scam. And then I have an old timer sitting there telling meit is a scam and John Felderhof is a terrible human being. And he went on to tell me afunny line. He goes;he ran into John once, and this is why Dale was never, ever allowedto go on site, because he said to John once, “John, haven't you taken this scam far, farenough?” And, you know, Felderhof kind of like, you know, shrugged his shoulders and left.Ever the diligent investor, Warren continued to rack up his phone bill, by gettingintel directly from Jakarta and mainly.
From the journalist John McBeth. He called me every night I met with John in Jakarta. As Warren Irwin said everyone gota bit too carried away with it. We were talking 200 million ouncesof gold here, and this is amazing. There’s one call John took which stands out.It was the middle of the night – December 1996. The phone rang. It was Warren.His opening line was ‘What if I told you there was no gold there?’ Everything wasgoing on, the share price was going up and I was suddenly stopped me in my tracks and Isaid what do you mean and he said I have had them assayed and there’s no gold there andI remember saying to him well what do you.
Make of that? And he said I don’t know andthen we got into a conversation about what was going on and we kind of forgot about it.Things were moving really fast and not long after McBeth had spoken to Warren he met with JohnFelderhof at the BATS bar in the Shangri la hotel. I talked to Felderhof quite often. He wasn’talways trustful of me but he got to know me alot better as time went on and he loosenedup quite a bit. But he was a man under great pressure. He was chain smoking, drinking endlessbottles of beer. He was really under the gun. Well that was about a month out fromwhen de Guzman allegedly jumped from the helicopter it was when the Suhartonfamily became fully engaged. I knew that they were under pressure, theywere under pressure to sell.
As Gold Fever took over: de Guzmanand Felderhof tightened access to the exploration site. They were trying tokeep a lid on the monster they’d awoken. But as much as they wanted to keep the world out. Bre-X’s incredible rise had brought themto the attention of powerful people. People who were willing to do whatever it wouldtake to force their way into Busang.
Thank you for sharing
More ppl want to hear this