BE rare earth intercepts grossly overstated

BE Resources slew of rare earths drilling results released on Friday have turned out to be, in many cases, misstated by an order of magnitude or more.

Author: Kip Keen
Posted: Monday , 25 Jul 2011

VANCOUVER, BC -

If it seemed too good to be true - that's because it was. As reported on Mineweb, BE Resources (TSX-V: BER) announced Friday a series of rare earth oxide intercepts that sent its shareprice skyward, up some 800 percent in a single day of trading.

The first official sign anything was amiss, however, came Monday when a trading halt was issued for BE Resources' stock pending "clarification of news."

It was not good. As it turns out, the REO grades in the original press release Friday were as spectacular as the scale of the error made in calculating them.

For example, where BE Resources had reported as much as 30 metres @ 19.6 percent REO, the revised number is now 1.96 percent. For another of its longer intercepts, the 15 percent REO over 31 metres became 0.97 percent. Of nine intercepts, two remained unchanged, while the rest overstated the REO grades by, in most cases, a factor of about ten.

To explain the discrepancy, BE Resources stated that errors "occurred in the process of aggregating a large volume of the assay results of fifteen individual rare earth elements into total rare earth oxides."

BE Resources said an independent consulting geologist had put together the REO grades, suggesting some blame rested with the unnamed consultant. In its press releases, BE Resources listed the company's President and CEO, David Tognoni, as the qualified person responsible for verifying the contents of the original press release.

Tognoni could not be reached for comment by email or phone as of press time. In a call placed to BE Resources Monday, an automated answering machine response stated that the company's voicemail memory was full.

BE Resources had not resumed trading Monday as of presstime.