I THINK MINING

The most common response to the question: “Has the NI43-101 process failed us in the Southwestern Resources case?” is a stout and firm reply: “If somebody wants to crook the books, there is nothing honest people can do about it.” To which I must reply: twaddle.

Of course there are crooks and fools in all walks of life; but that does not mean that we should neglect to put the systems in place that may be needed to catch them. Now is not the time to defend MSHA, the NI 43-101 process, or President Kabila. Now, as always, is the time to ask what we need to do to continuously improve the process/system to stop more crooks making fools of us all over again.

To emphasize my point and take a slightly lighter look at things, here is my collation of the doings of the crooks and fools in the mining industry this week.

Australia: A Brisbane court has been told a woman stole more than 100-thousand dollars from mining giant Rio Tinto .. to fund a lavish lifestyle. ILOAI SUANI was sentenced to four years jail for fraud. The 28-year-old gave the money to friends .. took overseas trips .. and got her employer to pick up the tab for a three-thousand-dollar a month inner-city apartment. SUANI was working in the accounts department when she began abusing her position to siphon funds from Rio Tinto. She obtained almost 104-thousand dollars by changing invoice details and forging a letter approving Rio Tinto to pay her rent. She put her own bank account details on invoices .. which were then signed off by her manager. Within days of finding out her offence was being investigated .. she booked herself on a flight to the US and skipped the country .. but was arrested on her return to Australia.

Vancouver: Small potatoes by comparison with Jim Patterson of Southwestern Resources, who is still in hospital with depression–and sending his bill to the generous Canadian health system. The prize for folly must, however go to the analyst, Eric Zaunscherb,who praises Southwestern Resources for for having a highly competent and reputable individual in charge and having this same fellow supported by “strong team members” and a “chastened Board of Directors.” Eric goes further: he believes the company is sound because they have $30 million working capital and a market value of $27 million. Did nobody tell him of the class action lawsuite for $320 million that has been filed against Southwestern Resources? I mean they are worth but one tenth of the amount they are being sued for. It will cost them $30 million to defend themselves. Or do they intend to push legal fees off onto the insurance companies of the poor consultants who prepared their now infamous NI43-101 reports?

Darkest Africa (aka Katanga): Billy Rautenbach of CAMEC has had his mining licenses revoked by the local court who seem to believe he got them in accordance with this fine old African principle: “Independent legal and financial experts are reviewing each contract because many were arranged during the civil war and its aftermath, often in flagrant breach of procedures, regulations and laws. Such breaches cannot be allowed to continue.” Needless to say there are reports that poor Billy believes there is no valid reason for the court’s decision and that he will prevail against the government of President Joseph Kabila, who many believe rigged the election in his favor. What a stew of crooks!

Idaho. In what must be the most bizarre and out-of-kilter reporting of the week, Mineweb writes: “Craig been a powerful Senate advocate for the Northwest Mining Association, the National Mining Association, and explorationists and small miners on a wide range of public policy issues including mining and exploration on public lands, taxation of precious metals mining, environmental regulation of hardrock mining, and Mining Law reform. Craig, in particular, staunchly opposed House Natural Resources Committee Chairman Nick Rahall’s numerous attempts of Mining Law reform over the years. Craig’s fall from grace, even among his Republican Senate colleagues, comes at a particularly critical time for western hardrock miners, who are counting on the Senate to stop Rahall’s H.R. 2262, if it proves too onerous to permit hardrock mining on federal laws.” Maybe a few taps of the feet in an in-appropriate setting will set it all aright?

Nashville, Tenn. Finally from a conference down south, the scariest bits of reporting about crooks and fools in mining:

The MINER Act of 2006 required that all mines have MSHA-approved emergency response plans in place. The plans also dictate where extra breathable air should be stored in case of an accident. Although most of the plan for Crandall Canyon was in place by June 13, MSHA gave the mine operators until Aug. 12 – six days after the accident – to meet the breathable air requirement.

Asked about Crandall Canyon mine owner Bob Murray – who has been accused of threatening federal safety officials by using his political connections to have them fired – Bruce Watzman, [vice president of the National Mining Association,] said Murray was committed to the future of mining as an industry and to the safety of his workers. “Everybody has a different way of going about things,” he said. “Some people like the way he operates, others do not.”

To which again, I reply: twaddle. It is not about like and dislike. It is about behavior, preformance, decency, honesty, principles, morality–that whole dreary list of things that go to make for a sane and safe society. Let us hope that Bruce Watzman learns this someday.