----

| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

|   | For the Quarterly Period Ended September 30, 2010 |
|--------|--------------------------------------------------------|

| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|------------------------------------------------------------------------------------------|

|   | For the Transition Period From ________ to _________ |
|--------|------------------------------------------------------|

| Utah                                     |   | 87-0669131          |
|------------------------------------------|--------|---------------------|
| (State or other jurisdiction of          |   | (I.R.S. Employer    |
| incorporation or organization)           |   | Identification No.) |
|                                     |   |                |
| Sankibai Batyr Ave., 14D                 |   |                |
| Aktobe City,Republic of Kazakhstan       |   | 030000              |
| (Address of principal executive offices) |   | (Zip Code)          |

| +7 (7132) 55-75-54                                                                                                                                                                                                                                                                                                                                                                           |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (Registrant's telephone number, including area code)                                                                                                                                                                                                                                                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                         |
| Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                                     | Yes x No o |
|                                                                                                                                                                                                                                                                                                                                                                                         |   |
| Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). | Yes  oNo o |

| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Large accelerated filer                       | o      |   | Accelerated filer         | o |   |
|-----------------------------------------------|--------|--------|---------------------------|---|--------|
| Non-accelerated filer                         | o      |   | Smaller reporting company | x |
| (Do not check if a smaller reporting company) |   |   |

| Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).                   | Yes o No x |
|---------------------------------------------------------------------------------------------------------------------------|------------|
|                                                                                                                      |       |
| As of November 15, 2010, the registrant had 124,980,296 shares of common stock, par value $0.001, issued and outstanding. |

----

|                                                                                                                | Page                                                                                                                                                                                                                          |
|---------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Item 1. Financial Statements                                                                                        |                                                                                                                                                                                                                          |
|                                                                                                                |                                                                                                                                                                                                                          |   |
|                                                                                                                | Condensed Consolidated Balance Sheets (Unaudited) as of  September 30, 2010 and December 31, 2009                                                                                                                   | 3 |
|                                                                                                                |                                                                                                                                                                                                                          |   |
|                                                                                                                | Condensed Consolidated Statements of Operations (Unaudited) for the Three Months and Nine Months Ended September 30, 2010 and 2009, and for the Period from March 5, 2004 (Date of Inception) through September 30, 2010 |  4 |
|                                                                                                                |                                                                                                                                                                                                                          |   |
|                                                                                                                | Condensed Consolidated Statements of Cash Flows (Unaudited) for the Nine Months Ended September 30, 2010 and 2009, and for the Period from March 5, 2004 (Date of Inception) through September 30, 2010                  |  5 |
|                                                                                                                |                                                                                                                                                                                                                          |   |
|                                                                                                                | Notes to Condensed Consolidated Financial Statements (Unaudited)                                                                                                                                                              | 6 |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations | 16                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 3.  Qualitative and Quantitative Disclosures About Market Risk                                       | 27                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 4T.  Controls and Procedures                                                                         | 27                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| PART II — OTHER INFORMATION                                                                                   |                                                                                                                                                                                                                          |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 1.  Legal Proceedings                                                                                | 29                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 1A. Risk Factors                                                                                               | 29                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| Item 6.  Exhibits                                                                                         | 29                                                                                                                                                                                                                            |
|                                                                                                                |                                                                                                                                                                                                                          |
| Signatures                                                                                                          | 29                                                                                                                                                                                                                            |

----

| BEKEM METALS, INC. AND SUBSIDIARIES                              |
|------------------------------------------------------------------|
| (An Exploration Stage Company)                                   |
| CONDENSED CONSOLIDATED BALANCE SHEETS                            |
| (UNAUDITED)                                                      |
|                                                             |   |   |   |   |   |
|                                                             |  September 30, |   |  December 31, |
|                                                             |  2010 |   |  2009 |
|                                                             |   |   |   |   |   |
| ASSETS                                                           |   |   |   |   |   |
|                                                             |   |   |   |   |   |
| Current Assets                                                   |   |   |   |   |   |
| Cash                                                             | $  |                  11,503  |   | $  |           534,619  |
| Trade accounts receivable                                        |   |                    24,099  |   |   |          22,439  |
| VAT recoverable                                                  |   |                 165,499  |   |   |            179,012  |
| Inventories                                                      |   |                 527,409  |   |   |           542,245  |
| Prepaid expenses and other current assets                        |   |                  64,831  |   |   |             46,444  |
| Deferred compensation                                            |   |                              -  |   |   |                   6,390  |
| Total Current Assets                                             |   |                 793,341  |   |   |       1,331,149  |
|                                                             |   |   |   |   |   |
| Property, plant and mineral interests (net of accumulated        |   |   |   |   |   |
| depreciation of $595,279 and $564,990)                           |   |             2,485,933  |   |   |       2,852,697  |
| Other assets                                                     |   |                  19,769  |   |   |      41,883  |
| Total Assets                                                     | $  |           3,299,043  |   | $  |          4,225,729  |
|                                                             |   |   |   |   |   |
| LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)                   |   |   |   |   |   |
|                                                             |   |   |   |   |   |
| Current Liabilities                                              |   |   |   |   |   |
| Notes payable to related parties                                 | $  |         2,031,981  |   | $  |         2,031,981  |
| Accounts payable                                                 |   |               354,686  |   |   |                122,610  |
| Accrued expenses                                                 |   |             340,852  |   |   |               151,064  |
| Total Current Liabilities                                        |   |        2,727,519  |   |   |             2,305,655  |
|                                                             |   |   |   |   |   |
| Asset retirement obligations                                     |   |        1,019,936  |   |   |                  911,297  |
| Total Liabilities                                                |   |        3,747,455  |   |   |           3,216,952  |
|                                                             |   |   |   |   |   |
| Commitments and Contingencies                                    |   |                              -  |   |   |                              -  |
|                                                             |   |   |   |   |   |
| Shareholders' Deficit                                            |   |   |   |   |   |
| Preferred stock; $0.001 par value, 20,000,000 shares authorized, |   |   |   |   |   |
| no shares outstanding                                            |   |                              -  |   |   |                              -  |
| Common stock; $0.001 par value, 300,000,000 shares authorized,   |   |   |   |   |   |
| and 124,980,296 shares issued and outstanding                    |   |            124,980  |   |   |              124,980  |
| Additional paid-in capital                                       |   |      28,387,055  |   |   |        28,387,055  |
| Accumulated deficit                                              |   |   (31,543,705) |   |   |    (30,229,302) |
| Accumulated other comprehensive income                           |   |      2,583,258  |   |   |           2,726,044  |
| Total Shareholders' Equity (Deficit)                             |   |        (448,412) |   |   |           1,008,777  |
|                                                             |   |   |   |   |   |
| Total Liabilities and Shareholders' Equity (Deficit)             | $  |         3,299,043  |   | $  |          4,225,729  |

----

| BEKEM METALS, INC. AND SUBSIDIARIES                        |
|------------------------------------------------------------|
| (An Exploration Stage Company)                             |
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS            |
| (UNAUDITED)                                                |
|                                                       |  For the Three MonthsEnded September 30, |   |  For the Nine MonthsEnded September 30, |   |  For the Period from March 5, 2004 (Date of Inception) through |
|                                                       |  2010 |   |  2009 |   |  2010 |   |  2009 |   |  September 30, 2010 |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue                                                    | $  |                    -  |   | $  |                  -  |   | $  |                   -  |   | $  |                    -  |   | $  |                               -  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating Expenses                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| General and administrative expenses                        |   |              463,765  |   |   |              646,368  |   |   |           1,498,177  |   |   |           1,942,162  |   |   | 14,935,600  |
| Research and development costs                             |   |                      -  |   |   |                       -  |   |   |                      -  |   |   |                      -  |   |   | 1,057,970  |
| Exploratory costs                                          |   |                 2,322  |   |   |                20,011  |   |   |                65,129  |   |   |                36,616  |   |   | 2,980,886  |
| Loss from impairment of property                           |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                      -  |   |   | 10,243,178  |
| Accretion expense on asset retirement obligations          |   |                34,113  |   |   |                12,750  |   |   |              103,182  |   |   |                39,353  |   |   | 703,035  |
| Grant compensation expense                                 |   |                      -  |   |   |                72,416  |   |   |                 6,390  |   |   |              310,044  |   |   |                       1,473,681  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expenses                                   |   |              500,200  |   |   |              751,545  |   |   |           1,672,878  |   |   |           2,328,175  |   |   |                      31,394,350  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss From Operations                                       |   |            (500,200) |   |   |            (751,545) |   |   |          (1,672,878) |   |   |          (2,328,175) |   |   |                    (31,394,350) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other Income/(Expense)                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Exchange gain/(loss) from remeasurement                    |   |                (3,256) |   |   |                27,543  |   |   |                (6,708) |   |   |                29,142  |   |   |                            45,026  |
| Exchange gain/(loss)                                       |   |                 4,318  |   |   |              (78,990) |   |   |              162,300  |   |   |          (2,789,825) |   |   |                      (2,774,578) |
| Interest income                                            |   |                      -  |   |   |                    377  |   |   |                 1,282  |   |   |                75,077  |   |   |                          708,535  |
| Interest expense                                           |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                      (1,337,317) |
| Other income, net                                          |   |                29,478  |   |   |                79,286  |   |   |              201,601  |   |   |              286,876  |   |   | 1,152,956  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Other Income/ (Expense)                                |   |                30,540  |   |   |                28,216  |   |   |              358,475  |   |   |          (2,398,730) |   |   |                      (2,205,378) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from Continuing Operations                            |   |            (469,660) |   |   |            (723,329) |   |   |          (1,314,403) |   |   |          (4,726,905) |   |   |                    (33,599,728) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from Discontinued Operations                          |   |                      -  |   |   |              (88,905) |   |   |                      -  |   |   |              (17,676) |   |   |                      (1,475,786) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Loss Before Taxes                                      |   |            (469,660) |   |   |            (812,234) |   |   |          (1,314,403) |   |   |          (4,744,581) |   |   |                    (35,075,514) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deferred tax benefit                                       |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                       3,390,601  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated Net Loss                                      |   |            (469,660) |   |   |            (812,234) |   |   |          (1,314,403) |   |   |          (4,744,581) |   |   |                    (31,684,913) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Less: Loss attributable to noncontrolling interests        |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                      -  |   |   |                          141,208  |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Loss Attributable To Shareholders of Bekem Metals Inc. | $  |          (469,660) |   | $  |         (812,234) |   | $  |      (1,314,403) |   | $  |      (4,744,581) |   | $  |                 (31,543,705) |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic Loss per Common Share                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loss from continuing operations                            | $  |                   -  |   | $   |               (0.01) |   | $  |               (0.01) |   | $  |               (0.04) |   |   |   |
| Income from discontinued operations                        |   |                      -  |   |   |                      - |   |   |                      -  |   |   |                      -  |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Consolidated net loss                                      | $  |                   -  |   | $  |              (0.01) |   | $  |             (0.01) |   | $  |               (0.04) |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-Average Shares used in                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    Basic Loss per Common Share              |   |        124,980,296  |   |   |        125,172,011  |   |   |        124,980,296  |   |   |        125,172,011  |   |   |   |
|                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| BEKEM METALS, INC. AND SUBSIDIARIES                                          |
|------------------------------------------------------------------------------|
| (An Exploration Stage Company)                                               |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS                              |
| (UNAUDITED)                                                                  |
|                                                                         |   | For the Nine MonthsEnded September 30, |   |   | For the Period from March 5, 2004 (Date of Inception) through |
|                                                                         |   | 2010 |   |   | 2009 |   |   | September 30, 2010 |
|                                                                         |   |   |   |   |   |   |   |   |
| Cash Flows from Operating Activities                                         |   |   |   |   |   |   |   |   |
| Net loss                                                                     | $  |       (1,314,403) |   | $  |        (4,744,581) |   | $  |                             (31,543,705) |
| Loss from discontinued operations                                            |   |                           -  |   |   |                   17,676  |   |   |                                    1,475,786  |
|                                                                         |   |   |   |   |   |   |   |   |
| Adjustments to reconcile net loss to                                         |   |   |   |   |   |   |   |   |
|    net cash provided by operating activities:                 |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                |   |                 149,243  |   |   |                 159,238  |   |   |                                       992,308  |
| Accretion expense on asset retirement obligations                            |   |                 103,182  |   |   |                   39,353  |   |   |                                       703,035  |
| Interest expense from debt discount                                          |   |                           -  |   |   |                           -  |   |   |                                       963,231  |
| Shares issued on option modification                                         |   |                           -  |   |   |                           -  |   |   |                                         19,426  |
| Deferred tax benefit                                                         |   |                           -  |   |   |                           -  |   |   |                                  (3,390,601) |
| Foreign currency exchange loss / (gain) and loss / (gain) from remeasurement |   |               (155,592) |   |   |              2,760,683  |   |   |                                    2,729,552  |
| Impairment loss on property, plant and mineral interests                     |   |                           -  |   |   |                           -  |   |   |                                  10,243,178  |
| Loss / (gain) on disposal of property and equipment                          |   |                   32,937  |   |   |                   35,814  |   |   |                                       (63,107) |
| Stock grant compensation expense                                             |   |                     6,390  |   |   |                 310,044  |   |   |                                    1,473,681  |
| Change in operating assets and liabilities:                                  |   |                          |   |   |                         |   |   |                                            |
| Trade accounts receivable                                                    |   |                   (1,413) |   |   |                   (8,443) |   |   |                                       (24,006) |
| VAT recoverable                                                              |   |                   14,690  |   |   |                     5,065  |   |   |                                     (106,044) |
| Inventories                                                                  |   |                   18,235  |   |   |                   35,357  |   |   |                                     (521,982) |
| Prepaid expenses and other current assets                                    |   |                   (4,809) |   |   |                 (16,756) |   |   |                                       (81,840) |
| Change in related party receivables / payables                               |   |                           -  |   |   |                           -  |   |   |                                     (206,171) |
| Accounts payable                                                             |   |                 224,529  |   |   |                 254,829  |   |   |                                       182,576  |
| Advances received                                                            |   |                     7,082  |   |   |                 (29,233) |   |   |                                           7,082  |
| Accrued expenses                                                             |   |                 172,255  |   |   |                 484,152  |   |   |                                       165,525  |
| Cash Used In Operating Activities - Continuing operations                    |   |               (747,674) |   |   |               (696,803) |   |   |                                (16,982,076) |
| Cash Used In Operating Activities - Discontinuing operations                 |   |                           -  |   |   |                   (1,904) |   |   |                                  (5,816,257) |
| Net Cash From Operating Activities                                           |   |               (747,674) |   |   |               (698,707) |   |   |                                (22,798,333) |
|                                                                         |   |   |   |   |   |   |   |   |
| Cash Flows from Investing Activities                                         |   |   |   |   |   |   |   |   |
| Purchase of property and equipment                                           |   |                      (404) |   |   |                 (53,167) |   |   |                                  (4,051,788) |
| Purchase of intangible assets                                                |   |                      (302) |   |   |                      (624) |   |   |                                       (47,221) |
| Proceeds from disposal of property and equipment                             |   |                 223,343  |   |   |                   77,213  |   |   |                                       694,560  |
| Loans provided to related parties                                            |   |                           -  |   |   |                 100,446  |   |   |                                (14,900,000) |
| Cash received from sale of subsidiary                                        |   |                           -  |   |   |                 500,000  |   |   |                                    5,000,000  |
| Cash acquired in acquisitions / received from discontinued operations        |   |                           -  |   |   |                           -  |   |   |                                         52,364  |
| Cash From (Used In) Investing Activities - Continuing operations             |   |                 222,637  |   |   |                 623,868  |   |   |                                (13,252,085) |
| Cash From Investing Activities - Discontinuing operations                    |   |                           -  |   |   |                           -  |   |   |                                       425,377  |
| Net Cash From Investing Activities                                           |   |                 222,637  |   |   |                 623,868  |   |   |                                (12,826,708) |
|                                                                         |   |   |   |   |   |   |   |   |
| Cash Flows from Financing Activities                                         |   |   |   |   |   |   |   |   |
| Proceeds from notes payable                                                  |   |                           -  |   |   |                           -  |   |   |                                  13,946,817  |
| Payments on notes payable                                                    |   |                           -  |   |   |                            -  |   |   |                                (21,649,038) |
| Proceeds from loans / notes payable - related parties                        |   |                           -  |   |   |                           -  |   |   |                                  18,210,606  |
| Payments on loans / notes payable - related parties                          |   |                           -  |   |   |                           -  |   |   |                                  (6,815,004) |
| Issuance of shares for cash                                                  |   |                           -  |   |   |                           -  |   |   |                                  26,728,842  |
| Cash From Financing Activities - Continuing operations                       |   |                           -  |   |   |                           -  |   |   |                                  30,422,223  |
| Cash From Financing Activities - Discontinuing operations                    |   |                           -  |   |   |                           -  |   |   |                                    4,979,594  |
| Net Cash From Financing Activities                                           |   |                           -  |   |   |                           -  |   |   |                                  35,401,817  |
|                                                                         |   |   |   |   |   |   |   |   |
| Effect of Exchange Rate Changes on Cash                                      |   |                     1,921  |   |   |                   (3,428) |   |   |                                       234,727  |
|                                                                         |   |   |   |   |   |   |   |   |
| Net (Decrease) / Increase in Cash                                            |   |               (523,116) |   |   |                 (78,267) |   |   |                                         11,503  |
| Cash at Beginning of Period                                                  |   |                 534,619  |   |   |                 115,459  |   |   |                                                -  |
| Cash at Beginning of Period - Discontinued Operations                        |   |                           -  |   |   |                        185  |   |   |                                                -  |
| Cash at End of Period                                                        |   |                   11,503  |    |   |                   37,377  |   |   |                                         11,503  |
| Less Cash of Discontinued Operations at End of Period                        |   |                           -  |   |   |                           -  |   |   |                                                -  |
| Cash of Continuing Operations at End of Period                               | $  |                 11,503  |   | $  |               37,377  |   | $  |                                      11,503  |
|                                                                         |   |   |   |   |   |   |   |   |
|                                                                         |   |   |   |   |   |   |   |   |

----

----

----

|   | Kempirsai               |          | Mamyt(1) |
|--------|-------------------------|---------------|----------|
|   |                    | Investments   |     | Tons of Brown |
|   | Tons of Ore   | $   |     | Coal   |
| 2009   | -                       | 6,000,000     |     | 200,000 |
| 2010   | -                       | 26,500,000    |     | 200,000 |
| 2011   | -                       | 42,000,000    |     | 200,000 |
| 2012   | -                       | 36,500,000    |     | 200,000 |
| 2013   | 800,000                 | 2,400,000     |     | 200,000 |
| 2014   | 800,000                 | 2,000,000     |     | 200,000 |
| 2015   | 1,000,000               | 2,000,000     |     | 200,000 |
| 2016   | 1,000,000               | 2,000,000     |     | 200,000 |
| 2017   | 1,500,000               | 1,000,000     |     | 200,000 |
| 2018   | 1,500,000               | 1,000,000     |     | 200,000 |
| 2019   | 1,600,000               | 1,000,000     |     |   |
| 2020   | 1,234,900               | 1,000,000     |     |   |
| Total  | 9,434,900               | 123,400,000   |     | 2,000,000 |

|  (1) | In December 2009 KKM received a letter from the MEMR granting KKM’s request to decrease the coal volume production requirements of its work program from 200,000 tons per year to 5,000 tons per year for the period from 2009 to 2012. These changes are not reflected in the above table and will not be reflected until these changes are legally approved by the government by the signing of a new addendum to the existing subsoil use contract. Signing of the addendum by the government has not yet occurred due to recent reorganizations within the government of the Republic of Kazakhstan and creation of the MINT in March 2010 to assume the responsibilities of the MEMR with regard to non-oil-related licenses. The Company anticipates an addendum to this license memorializing the changes to the annual work program requirements to be signed by MINT sometime in early December 2010. |
|-----------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                     |   September 30, |                                                                                                                                              |    December 31, |
|--------------------------|----------------------|---------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------|
|                     |   2010          |                                                                                                                                              |   2009               |
| Current accounts (USD)   | $                    |                8,442                                                   |                      | $ |               19,289 |
| Current accounts (Tenge) |                 |                   3,061                                 |                      |   |                 75,071 |
| Bank deposit (USD)       |                 |                         - |                      |   |               150,107 |
| Bank deposit (Tenge)     |                 |                         - |                      |   |               290,152 |
| Total                    | $                    |               11,503                                                        |                      | $ |             534,619 |

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|                               |  September 30, |                                                                                                                                                    |   December 31, |
|------------------------------------|---------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------|
|                               |  2010          |                                                                                                                                                    |  2009               |
| Buildings                          | $                   |          1,544,212                                                                                    |                     | $ |         1,562,807  |
| Machinery and equipment            |                |            1,481,338                                                                        |                     |   |            1,744,464  |
| Other fixed assets                 |                |                 55,662                                             |                     |   |               110,416  |
| Unproved mineral interests         |                |                         -  |                     |   |                         -  |
|                               |                |            3,081,212                                                                        |                     |   |            3,417,687  |
| Accumulated depreciation           |                |              (595,279)                                                                 |                     |   |              (564,990) |
| Property, plant and equipment, net | $                   |          2,485,933                                                                                    |                     | $ |          2,852,697  |

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| Territory Name | Size of Territory | Primary Minerals      | LicenseType | License or Contract # | License and SubsoilUse Contract Term    |
|----------------|-------------------|-----------------------|-------------|-----------------------|-----------------------------------------|
|           |              |                  |        |                  |                                    |
| Kempirsai      | 575,756 acres     | Nickel and cobalt ore | Production  | MG #420MG #426        | Expires Oct. 12, 2020 unless extended.* |
| Mamyt          | 116 acres         | Brown coal            | Production  | MG #9-D               | Expires Dec. 11, 2018 unless extended.* |

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| For the Nine Months Ended September 30, |  2010 |                  |   2009 |
|-----------------------------------------|------------|-----------------------|------------------|
|                                    |       |                  |             |   |   |
| Net cash from operating activities      | $     |  (747,674)       |             | $  | (698,707) |
| Net cash from investing activities      |       | 222,637          |             |   | 623,868  |
| Net cash from financing activities      |       | –          |             |   | –  |
| Effect of exchange rate changes on cash |       | 1,921            |             |   | (3,428) |
| NET (DECREASE) / INCREASE IN CASH       | $     |   (523,116) |             | $  |  (78,267) |

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| ·   | the sale of one kilometer of obsolete railroad bed (rails and ties or wooden sleepers) related to the Mamyt railroad for $65,557, |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------|

| ·   | the sale of some automobiles and an automotive-type crane for $71,794, |
|--------------------|------------------------------------------------------------------------|

| ·   | the rental of railway siding for $18,711, and |
|--------------------|-----------------------------------------------|

| ·   | railway siding services and other services for the sum $66,575. |
|--------------------|-----------------------------------------------------------------|

|                                      |   |         |   |  Payments due by Fiscal Year |
|-------------------------------------------|--------|--------------|--------|-----------------------------------|
|  Contractual Commitments             |   |  Total  |   | Less than1 year                   |   |  1-3 years |   |  3-5 years |   | More than 5 years |
| KKM’s work programs (1) (2)         |   | $123,400,000 |   | $32,500,000                       |   | $78,500,000 |   | $4,400,000 |   | $8,000,000 |
| Operating leases                          |   | 22,200       |   | 22,200                            |   | -0- |   | -0- |   | -0- |
|       Total |   | $123,422,200 |   | $32,522,200                       |   | $78,500,000 |   | $4,400,000 |   | $8,000,000 |

|  (1) | The current terms of the Kempirsai contract require KKM to invest $135 million to be applied to its mining and ore processing technology during the period 2006-2020 (or around $123.4 million for the remaining period). Also, the estimates include $985,000 for remediation work, including the removal of all equipment and to remediate the property.  This remediation work can be done during the term of the subsoil use contract or upon completion of the terms of the contract. If the licenses are terminated, the remediation work must be completed upon termination. |
|-----------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | In March 2008 KKM entered into a preliminary consortium agreement with two Kazakhstani companies, GRK Koitas LLP (“GRK”) and Asia-Invest Corporation LLP (“AI”), who also have exploration and production licenses near the Company’s Kempirsai deposit in northwestern Kazakhstan.  Under the preliminary consortium agreement, which was amended in November 2009, the parties are obliged to jointly contribute approximately $9.2 million for financing the construction of the processing plant. Of this amount, KKM is obligated to contribute approximately $4.6 million. Contributions made by the parties into the consortium are accounted for in the annual work programs of these parties. As of September 30, 2010 contributions of GRK equal KZT 181 million ($1,225,489) and contributions of AI equal KZT 119 million ($806,492), which were to be used for construction of a processing plant. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Exhibit No. |   | Exhibit Description                                                                                      |
|-------------|--------|----------------------------------------------------------------------------------------------------------|
|        |   |                                                                                                     |
| 31.1        |   | Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes- Oxley Act of 2002* |
| 31.2        |   | Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes- Oxley Act of 2002* |
| 32.1        |   | Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes- Oxley Act of 2002* |
| 32.2        |   | Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes- Oxley Act of 2002* |

|                    | BEKEM METALS, INC.                      |
|-------------------------|-----------------------------------------|
|                    |                                    |
|                    |                                    |
| Date: November 22, 2010 | /s/ Serik Bazarbayev                    |
|                    | Serik BazarbayevChief Executive Officer |

| Date: November 22, 2010 | /s/ Serik Bazarbayev                            |
|-------------------------|-------------------------------------------------|
|                    | Serik BazarbayevInterim Chief Financial Officer |

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