absolute disgrace, page-12

GOLDEN WEST Resources is no stranger to controversy.

In the five years since listing, there have been fistfights at its annual meeting, company files handed over to the Australian Federal Police, anonymous complaints from shareholders to the corporate regulator and links to Melbourne underworld figure Mick Gatto.

And in a move that has raised eyebrows among shareholders, now one of its projects ? the Dohertys gold deposit in Western Australia ? that formed the basis of its float is being sold to Classic Minerals in return for a $2000 option and a minimum exploration expenditure of $200,000 over three years, after which a 90 per cent interest can be had for $80,000.
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There are fears it could represent a classic case of buying high and selling low, but this time from the same person.

Golden West was formed when a rough-and-tumble Kalgoorlie prospector, John Doutch, sold projects in return for shares. Mr Doutch is now an alternate director of the company.

When Golden West floated, Mr Doutch's company, Lingchip, received an initial 350,000 shares plus a $20,000 fee. It later gained another 5 million, when the combined gold resources at Dohertys and Wiluna West reached 100,000 ounces.

Dohertys contains about 20,000 ounces of gold, meaning Lingchip effectively received 1.35 million shares in return for the project. Those shares are worth $620,000 based on yesterday's Golden West closing price, but were worth $3.4 million at the peak of the market. If Golden West's share price rebounds in the future alongside the iron ore price, the price being paid by Classic will look even stingier. Classic is unlisted, but records from the corporate regulator have listed Mr Doutch, his brother Malcolm and Ken Allen, a director of Fairstar Resources, another company linked to Mr Doutch, as the shareholders.

Until the end of last month, Golden West's executive chairman, Con Markopolous, served on the board of Classic, which is run from the former offices of Fairstar.

Vicki Morton, who was appointed a director of Classic last month, yesterday told The Age she was unable to answer questions about the company and its purchase of the Dohertys project.

She said the company had no managing director, and refused to provide names of anyone at Classic who might be able to answer questions.

A Golden West spokesman could not provide any information on Classic.
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