This Gold Mining Company Is The Best Bet In Nevada [View article]
My understanding was that previous owners of the Relief Canyon Mine wanted to form relationships with Couer d'Alene and Newmont and others, but the big guys wouldn't give them the time of day.
As soon as Alfers came on board, everything changed. I expect, (just my opinion) further strategic initiatives with Newmont, Couer d'Alene and other Nevada producers before the end of next year.
This Gold Mining Company Is The Best Bet In Nevada [View article]
1) Alfers joins Pershing 2) New ties with Newmont and Couer d'Alene AFTER Alfers takes over 3) Alfers grows land position to 39 sq miles, thereby consolidating a highly prospective play for the first time in decades. This enables drilling based on where geologists expect to find gold, unconstrained by property boundries. 4) Advanced technology finds NEW mineralization zones. One of the new zones has ore, "two to five times" that found on the previously exploited areas where prior owners produced 390k ounces of gold 5) A key director and a billionaire, "smart money" investor buy shares on the open market on a fairly large scale of several months, as recently as September, 2012.
Mongolia: Inexplicable Politics And 3 Investable Companies [View article]
Excellent update as always. I think geopolitical risk in Mongolia is very high. There was a range of possibilities a year or 2 ago, and Mongolian has managed to come in at the top end of it.
The loss to SouthGobi and possibly Mongolian Mining, (I'm not sure how that one works out) will ultimately be the gain for other natural resource stocks in Mongolia, those with good local ties.
In terms of coal, let's not forget that coal market fundamentals are extremely weak. So, not all of the stock price decline in coal names is necessarily due to country risk.
Aspire Mining is interesting, but no near term catalyst.
I'm hoping Jonathan will start a blog on Kyrgyzstan.... I have my reasons...
Where Investors Need To Be Looking In The Coal Sector Right Now [View article]
I strongly believe that ANR is a better risk-adjusted play than ACI. According to the much discussed BMO downgrade report of ACI and ANR, the analyst said that even if Alpha's trailing 12-month EBITDA were to fall to $440 million in any quarter of 2013 or 2014, AND if Alpha's un-drawn $1 billion revolver were fully drawn, the Company would still pass it's secured debt and interest coverage tests.
Last year EBITDA was 1.2 billion. This year it's probably falling to $750mm-$800mm, next year is a wild card, but I don't believe it wall fall into the $400's unless coking coal prices are weaker than today for all of 2013. I found it impressive by the way that ANR reported $41 million of FCF in the first quarter of 2012.
ANR has a solid balance sheet. $700 million of cash + marketable securities and a $1b un-drawn revolver. As for a write-off of assets, that's the worst kept secret in the world. They had a big write-down last year. A write-down will not impact debt covenant compliance, so it shouldn't be a big deal.
So, forget financial distress for Alpha for the time being, we can revisit that topic in a year. Instead, think about which companies could come out of this prolonged downturn in relatively good shape, ANR fits that bill.
Ivanhoe Mines: Nothing Much Has Changed [View article]
Jon, you're a class act.
I have no opinion on Nik, but even if I did, I would keep it to myself and not attack him.
Jon is far and away the SA expert on all topics Mongolia. I trust his facts and analysis more than any other writers...
As such, I truly appreciate and look forward to his updates and due diligence which entail an enormous amount of hard work and travel. I trust Jon a lot more than most analysts when it comes to discussions on IVN.
His self-imposed one-week trading block is a testament to his integrity.
Market Reactions To Implications Of China's 2012 GDP Estimate [View article]
Excellent article, well reasoned.
I would add that Canadian-listed, Mongolian coking coal producer, SouthGobi Resources, (SGQ.TO & 1878.HK) is extremely well positioned to benefit. SGQ is exporting to China at a run-rate of 6mm metric tonnes, headed towards 10mm tonnes within 3 years. SGQ is, and will continue to be, a dominant player in coking coal....
SouthGobi Makes A Logical Target For Teck Resources [View article]
Cracker 1 asks an important question about why Ivanhoe doesn't want to increase its stake in SouthGobi from 57% to 100%. The answer that I get when asking management is that, 1) IVN already owns a controlling stake at 57% and doesn't need to own 100%, 2) IVN needs every penny it has to advance its own massive copper/gold project in Mongolia and 3) Rio Tinto is going to buy IVN outright or at least creep above 50% ownership of IVN in 2012. And, RIO doesn't care about SouthGobi, (so why should IVN buy the remaining 43% stake if RIO doesn't care).
The real question for me then is why RIO doesn't care about SouthGobi given my strong feelings on the fundamentals for SGQ's top 2 position in Mongolia's coal exports. The answer I get to this is that RIO is 100% a seaborne coal player and that a land-based exporter of Mongolian coal to China simply doesn't fit RIO's business model. I find this answer to be unsatisfying, but that is what I'm told....
Mongolia: An Economic Boom Investment Guide [View article]
Mongolian Government Endorses Chandgana Power Plant Project 2011-09-15 12:30:01.65 GMT
TSX VENTURE SYMBOL: PCY OTCQX SYMBOL: PRPCF
Mongolian Government Endorses Chandgana Power Plant Project The ("Company") announces today that its Chandgana Power Plant Project ("Project") has been officially endorsed by the Mongolian Ministry of Natural Resources and Energy. The Mongolian Energy Regulatory Authority ("ERA"), in charge of power plant license issuance, has received the endorsement and is expected to issue a final response to Prophecy's license application in Q4, 2011.
The request for licensing of "Construction of Energy Buildings and Installations", submitted by East Energy Development LLC, a wholly-owned Mongolian subsidiary of Prophecy, in April, 2011, was determined to be in full conformity with Clause 2 of Article 12, Energy Law. The company has undergone a rigorous power plant permitting process, which included Environmental Impact Assessment approval by The Mongolian Ministry of Nature and Environment, and support from the Mongolian Scientific and Technical Council. The power plant will be built right next to Prophecy's permitted Chandgana Tal Coal Project.
Results from the Power Plant Feasibility Study by Evonik Industries and the Chandgana Tal Mine Study by Leighton Asia are expected in Q4 2011. In parallel, Prophecy has been in discussion with a number of potential Engineering, Procurement and Construction (EPC) contractors with the goal of finalizing EPC selection expeditiously after the power plant license is obtained.
Prophecy's cash position and equity holdings total over US $90million as of September 1, and the company expects to fully fund the Chandgana project studies through to project financing.
Prophecy appreciates the support from the Mongolian Ministry and the community at large. The company looks forward to making the Chandgana Power Plant a reality and helping satisfy Mongolia and the region's energy needs.
About Evonik
As the fifth largest producer of power in Germany, Evonik Steag operates nine coal-fired power plants. Outside Germany Evonik is contributing to the public power supply in the Philippines, Colombia and Turkey with three coal-fired power plants. The range of services of Evonik Steag covers the entire value chain of energy production from fuel to residue. Its core competencies include the planning, financing, construction and operation of highly efficient power plants for fossil fuels. For more information, visit evonik-steag.com.
About Prophecy Coal
Prophecy Coal Corp. is a Canadian listed company engaged in developing energy projects in Mongolia. The company has over 1.4 billion tonnes of surface minable thermal coal resources on two coal properties in Mongolia. Prophecy Coal's Ulaan Ovoo coal mine is in production and Chandgana mine mouth power plant is currently being permitted. Prophecy Coal is the controlling shareholder of Prophecy Platinum Corp (TSX VENTURE:NKL). Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Further information on Prophecy Coal can be found at prophecycoal.com.
This Gold Mining Company Is The Best Bet In Nevada [View article]
As soon as Alfers came on board, everything changed. I expect, (just my opinion) further strategic initiatives with Newmont, Couer d'Alene and other Nevada producers before the end of next year.
This Gold Mining Company Is The Best Bet In Nevada [View article]
1) Alfers joins Pershing
2) New ties with Newmont and Couer d'Alene AFTER Alfers takes over
3) Alfers grows land position to 39 sq miles, thereby consolidating a highly prospective play for the first time in decades. This enables drilling based on where geologists expect to find gold, unconstrained by property boundries.
4) Advanced technology finds NEW mineralization zones. One of the new zones has ore, "two to five times" that found on the previously exploited areas where prior owners produced 390k ounces of gold
5) A key director and a billionaire, "smart money" investor buy shares on the open market on a fairly large scale of several months, as recently as September, 2012.
Mongolia: Inexplicable Politics And 3 Investable Companies [View article]
The loss to SouthGobi and possibly Mongolian Mining, (I'm not sure how that one works out) will ultimately be the gain for other natural resource stocks in Mongolia, those with good local ties.
In terms of coal, let's not forget that coal market fundamentals are extremely weak. So, not all of the stock price decline in coal names is necessarily due to country risk.
Aspire Mining is interesting, but no near term catalyst.
I'm hoping Jonathan will start a blog on Kyrgyzstan.... I have my reasons...
Coal Stocks Consensus Earnings, Today Vs. A Year Ago [View article]
Where Investors Need To Be Looking In The Coal Sector Right Now [View article]
Last year EBITDA was 1.2 billion. This year it's probably falling to $750mm-$800mm, next year is a wild card, but I don't believe it wall fall into the $400's unless coking coal prices are weaker than today for all of 2013. I found it impressive by the way that ANR reported $41 million of FCF in the first quarter of 2012.
ANR has a solid balance sheet. $700 million of cash + marketable securities and a $1b un-drawn revolver. As for a write-off of assets, that's the worst kept secret in the world. They had a big write-down last year. A write-down will not impact debt covenant compliance, so it shouldn't be a big deal.
So, forget financial distress for Alpha for the time being, we can revisit that topic in a year. Instead, think about which companies could come out of this prolonged downturn in relatively good shape, ANR fits that bill.
Update On Natural Gas [View article]
I will be publishing an exclusive interview with the CFO of Alpha Natural Resources, (ANR) on Monday. Please keep an eye out for it.
Why I Am Sticking With Patriot Coal [View article]
Ivanhoe Mines: Nothing Much Has Changed [View article]
I have no opinion on Nik, but even if I did, I would keep it to myself and not attack him.
Jon is far and away the SA expert on all topics Mongolia. I trust his facts and analysis more than any other writers...
As such, I truly appreciate and look forward to his updates and due diligence which entail an enormous amount of hard work and travel. I trust Jon a lot more than most analysts when it comes to discussions on IVN.
His self-imposed one-week trading block is a testament to his integrity.
Okay, enough of that, you get the idea...
Market Reactions To Implications Of China's 2012 GDP Estimate [View article]
I would add that Canadian-listed, Mongolian coking coal producer, SouthGobi Resources, (SGQ.TO & 1878.HK) is extremely well positioned to benefit. SGQ is exporting to China at a run-rate of 6mm metric tonnes, headed towards 10mm tonnes within 3 years. SGQ is, and will continue to be, a dominant player in coking coal....
A Prudent Option Strategy For Undervalued Cliffs Natural Resources [View article]
You may be the 2nd best writer on SA....
Natural Resources Partners: 9% Yield And A 22% Total Return Opportunity [View article]
Coal Fundamentals: Straight From The Experts [View article]
For all who liked this article, and the 2 from last week, please "follow" me (and recommend me?) for more commentary to come. Thanks.
SouthGobi Makes A Logical Target For Teck Resources [View article]
The real question for me then is why RIO doesn't care about SouthGobi given my strong feelings on the fundamentals for SGQ's top 2 position in Mongolia's coal exports. The answer I get to this is that RIO is 100% a seaborne coal player and that a land-based exporter of Mongolian coal to China simply doesn't fit RIO's business model. I find this answer to be unsatisfying, but that is what I'm told....
Mongolia: An Economic Boom Investment Guide [View article]
On another note, please ask about Aspire Mining if you get the chance.
Thanks! Keep up the good work.
Mongolia: An Economic Boom Investment Guide [View article]
2011-09-15 12:30:01.65 GMT
TSX VENTURE SYMBOL: PCY
OTCQX SYMBOL: PRPCF
Mongolian Government Endorses Chandgana Power Plant Project
The ("Company") announces today that its Chandgana Power Plant Project ("Project") has been officially endorsed by the Mongolian Ministry of Natural Resources and Energy. The Mongolian Energy Regulatory Authority ("ERA"), in charge of power plant license issuance, has received the endorsement and is expected to issue a final response to Prophecy's license application in Q4, 2011.
The request for licensing of "Construction of Energy Buildings and
Installations", submitted by East Energy Development LLC, a wholly-owned Mongolian subsidiary of Prophecy, in April, 2011, was determined to be in full conformity with Clause 2 of Article 12, Energy Law. The company has undergone a rigorous power plant permitting process, which included Environmental Impact
Assessment approval by The Mongolian Ministry of Nature and Environment, and support from the Mongolian Scientific and Technical Council. The power plant will be built right next to Prophecy's permitted Chandgana Tal Coal Project.
Results from the Power Plant Feasibility Study by Evonik Industries and the Chandgana Tal Mine Study by Leighton Asia are expected in Q4 2011. In parallel, Prophecy has been in discussion with a number of potential Engineering, Procurement and Construction (EPC) contractors with the goal of finalizing EPC selection expeditiously after the power plant license is obtained.
Prophecy's cash position and equity holdings total over US $90million as of September 1, and the company expects to fully fund the Chandgana project studies through to project financing.
Prophecy appreciates the support from the Mongolian Ministry and the community at large. The company looks forward to making the Chandgana Power Plant a reality and helping satisfy Mongolia and the region's energy needs.
About Evonik
As the fifth largest producer of power in Germany, Evonik Steag operates nine coal-fired power plants. Outside Germany Evonik is contributing to the public power supply in the Philippines, Colombia and Turkey with three coal-fired power plants. The range of services of Evonik Steag covers the entire value chain of energy production from fuel to residue. Its core competencies include
the planning, financing, construction and operation of highly efficient power plants for fossil fuels. For more information, visit evonik-steag.com.
About Prophecy Coal
Prophecy Coal Corp. is a Canadian listed company engaged in developing energy projects in Mongolia. The company has over 1.4 billion tonnes of surface minable thermal coal resources on two coal properties in Mongolia. Prophecy Coal's Ulaan Ovoo coal mine is in production and Chandgana mine mouth power plant is currently being permitted. Prophecy Coal is the controlling shareholder of Prophecy Platinum Corp (TSX VENTURE:NKL). Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Further information on Prophecy Coal can be found at prophecycoal.com.