Doyle's defense on Dow Jones- 11:22PM
NEW YORK (Dow Jones)--International Precious Metals Corp. (IPMCF)
stock tumbled more than 41% Monday after market watchers interpreted
recently-released test results from the company's Black Rock Project in
Arizona as bad news.
Company Chairman Alan Doyle disputes the interpretation as "a total
misunderstanding" instigated by non-technical officials unfamiliar with the
process.
On Friday, the Phoenix-based company released its first test results from the
Arizona site, which used a Modified Fire Assay procedure that was
approved by an Arizona Registered Laboratory. The results, which included
two small samples, confirmed the existence of 0.5 to 2.5 grams per ton of
gold, and between zero and 80 grams per ton of silver.
Doyle said the results were "in line with the company's expectations," given
the small sample size and the new procedure. However, he said market
watchers, foreign to the process, compared those results to ones released
about five months ago which used a "recovery" process, and he said direct
comparisons are unfair.
"It's like comparing apples with oranges," Doyle said. The recovery process
had reported the existence of gold and platinum in 3 to 25 grams per ton,
but the chairman explained that that process is based on larger samples.
"It's the difference between 20-pound samples and 400-pound samples,"
Doyle contended, "and you can't look at (the results) in isolation." He added
that the company plans to conduct tests on about 2,100 more samples using
the regulatory-approved Fire Assay process over the next three to four
months. At that time, he said, International Precious Metals will know if the
Black Rock site is economically viable.
A frustrated Doyle said the company has been swimming against the tide of
investor favor since an Arizona department of Mines official three years ago
called the company's early results a "scam."
"He claimed we were all crooks," said Doyle, and added, "We're taking him
to court." The company is seeking more than $25 million in damages for
what it calls "false and misleading statements."
The company's early results, which reported three to four grams of gold and
platinum per ton, were based on a testing method not endorsed by an
Arizona registered lab.
Skeptical market watchers are also shy about accepting test results in the
wake of the Bre-X Minerals Ltd. fiasco, in which the company's claims of
gold at an Indonesian site were proven to be wrong.
International Precious Metals closed Monday at 3 1/8, off 2 1/4, or 41.9%,
on volume of 1,211,300 shares compared with average daily volume of
222,696.
interactive.wsj.com
(subscription required) Tim |
