Bobwins

First Majestic: The First of Many Majestic Quarters to Come

I just bought into Fortuna. I like the long term approach of mgmt and the internally generated growth instead of issuing mass quantities of cheap shares. They look like a good longer term hold.

That said, I still like the near term catalysts for First Majestic. They still need to work out the kinks and prove to the markets that La Encantada can produce up to capacity. Like all major projects, it has been delayed and has caused the company to repeatedly lower guidance for 2009. But once fully online by year end, it should move First Majestic into the 6 million oz/yr production range, a dramatic 50% increase from current levels and lower costs at the same time.

This is the catalyst that gives FR the advantage, in my opinion, over FVI. As FVI advances their new mine construction, they will have the same type of catalyst but the timeframe is out 12-18months. Until then, they will be profitably producing 1.6 m to 2 million oz.

I also hold CDE and SLW because they are big cap and get the institutional money whenever gold and silver are rising.

Long shot? REX.v. C$.15 Just raised 3 million and about to start drilling Coneto project in the same area as several big silver mines. Mgmt is from Orko, that JV'd their initial project to PAAS.

Some Junior Silver Miners Are Heavily Underpriced

First Majestic is due for a big increase in production. They are increasing mill capacity at one of their mines from 800 tpd to 3500tpd. The project is coming online this month. Should significantly increase cashflow and also lower cash costs.

Apollo Gold Still a Risky Proposition for Most - Blackmont

Company is in production and they have confirmed 1500tpd with 1800tpd as a near term goal. Cash costs are below $400/oz so 20,000 oz of production will result in cashflow of 10 million + for Q3.

Company is certainly aware of the first debt repayment and did the recent PP to accelerate drilling near the 13 oz/tonne results at Grey Fox. Production cashflow should provide ample cash for debt repayment. Company has been in production for a couple years at their Montana base metal mine so has experienced production staff used to much higher production levels.

Apollo is very undervalued and should move beyond Blackmont target by yearend after proving they can produce at 1800tpd and then 2100 by year end. Bobwins

China Still Vulnerable to Slowdown, Despite Domestic Market 'Buffer'

The stock market is small in China. There was rampant speculation and that has resulted in a crash, as it usually does.

Your article doesn't mention what I expect will also bolster the Chinese economy. China is like the US in the 50's, 60's and 70's. They are building the infrastructure to support their tremendous growth. We are talking about them dropping below double digit growth for the first time in the decade. We would kill for 5% growth.

The building of freeways, bridges, power grid, dams, nuclear power plants, rail, subway, etc. is a tremendous addition to the Chinese economy. While it won't make up for all the losses in low cost manufacturing jobs, it will be steady due to government funding.

Large infrastructure projects do not stop and start with expectations. They are building them continuously to try to catch up and stay ahead of growth. At this stage in their growth cycle, China is fundamentally a lot stronger than their fledging stock market. Bobwins

Energy ETFs and Hurricanes

Ngas is also not easily replaceable from other sources. If the GOM platforms are shut down because of hurricane risk, there are short term reductions in productions. But if there is permanent damage to the platforms or especially undersea pipelines, the repairs could take months or years. The ngas is not as easily replaced as the oil.

Of course, a spike in ngas prices to double digits might attract more LNG but that could take months to arrange also and the price would have to be much higher than the current 8.62 to compete with China, Japan, S. Korea and Europe who are paying up to twice that for LNG.

SEMAFO: Junior Gold Miner Shines

Mark Medayski, you are right. You should stay away from stocks trading on the Toronto Stock Exchange. This is the senior Canadian exchange and only bigger, more well established companies can trade there. Better you stick with your low risk bankrupt US stocks!

All kidding aside, Semafo looks like a slam dunk bargain.

Produced 54,000oz of gold in Q2. They just installed a new ball mill at Mana that will double production capacity. Since they produced around 7800 oz in July, it looks like they will ramp up to around 15,000 oz for Mana later this year. So the .05eps they earned in Q2 isn't the peak production.

Annualized the .05 eps turns into .20eps and the stock should be selling for around $4. Although it trades in Canada, SMF.to doesn't appear to have that much of a following in Canada. Maybe the African location scares some away. Seems really cheap and mgmt appears very capable after bringing three mines into production. Most companies nowadays can't bring one to production.

Bobwins

Natural Gas Prices Set To Surge - Canaccord

The comments about increased supply are important but there is still a deficit. We produce about 85% of our demand. Canada has supplied the difference but their production is flat to down. They will export less to us because of flat production and increased domestic usage for tar sands. The difference is coming from LNG but our lower prices versus world prices means we are getting less LNG.

We will benefit from the increased production but our massive deficit in oil production vs consumption will eventually push various consumers towards ngas and that will support ngas prices and eventually reestablish equity on a btu/btu basis with oil. Human nature. If it's a cheaper alternative, Americans will double size it until it gets scarce and expensive. We consume too much energy per capita. Quit complaining about prices and do the logical thing......USE LESS!

Are These Nine Methane Stocks On Fire, or Blowing Hot Air?

My experience has been that small cap explorers who specialize in coal bed methane have an extremely long rampup time. The coal bed methane produces very low amounts so you need to drill a lot of them. The wells typically pump fluids for a long time and you need to have a place to dump the fluids or pay for the tool that lets you reinject the water into another formation. Otherwise it's contaminated water that is expensive to get rid of.

You're not going to buy Consol or Peabody because they produce coalbed methane on the side. However they have the capital and cashflow from their main business to profitably extract the coal bed methane and wait for the production to add to profits. They already have the coal land so this is a nice additional revenue source.

I own QRCP because they are buying a private company with large Marcellus Shale land holdings. PetroEdge was the leader in the Marcellus and QRCP is buying their current production and acreage. The shale plays are the key to long term growth. The play extends over extended distances and has just been difficult to extract until recent technical advances have made it possible.

Now companies with capital can turn this into a factory situation. They have capital so they can afford the high costs of horizontal drilling and specialized fracing. They can throw additional capital at it and increase the number of drills and crews working their inventory. The results are more uniform and are high percentage.

If the industry can repeat the Barnett Shale, the plays with large acreage posiitions and good technical skills should become long term winners. The big guys can wait for a little guy like PetroEdge to prove up the area and then move in with cash when it's ready for a rampup in drilling.

There will be many winners in shale gas over the next few years. Ngas is clean burning, hard to transport and we already have a deficit in domestic production. We are getting about 15% of our consumption from Canada. That supply is dwindling as they use more themselves and use it for the tar sands rampup.

Bobwins

Jinpan Int'l: A Small-Cap Chinese Infrastructure Play

I haven't purchased JST but have a comment about China's growth. The exceptional growth of China is similar to the US growth in the 50's, 60's and 70's. Infrastructure buildout is a long term, continuous process that doesn't stop for short term economic events. The government in China is in control of planning the power grid, dams, freeways, utilities, sewers and water supply. They cannot stop and start these projects. If for nothing more than for employment and riot avoidance, the government will continue the planning, construction and implementation of massive infrastructure projects for their billion plus population. I am buying a basket of Chinese stocks aimed at those who provide services and products to the domestic Chinese economy, not the cheap labor Walmart products. The internal growth of China and it's internal consumption are the prize here.

JLT looks like it fits my target parameters but it isn't particularly cheap. Thanks for the good article. I will do some DD on JLT. It is certainly got growth in the infrastructure buildout categories. Bobwins

2 Wind-Generated Power Companies to Consider

Another possible way to play wind is APWR. They have been in energy cogeneration and have current revs of over 100million per year and a backlog over 400million. They announced recently that they are going to build a factory to build wind turbines and have licensed two different German designs. They also announced an LOI for close to 1 billion dollars for a large project that would require the total factory capacity thru 2009. The margins for the wind turbines are much lower than their traditional cogeneration work but the dollar amounts are large. I have been holding CSCA.ob, which recently changed names and went to nasdaq as APWR. Long term, both sectors appear to be good and APWR has size and financing capacity.

China Natural Gas: There's Still Time to Catch Some Growth

How did you get your eps numbers?

"For the year 2007, the Company expects revenue to increase 70% to $32.0 million from $18.8 million in 2006. The Company expects net income to increase 70% to $9.3 million in 2007 from $5.5 million in 2006. For the year 2008, the Company anticipates revenue and net income growth of at least 70%."
2006=5.5/22 or .25eps
2007= 9.3/24.2 or .38eps
2008= +70% or 15.81/26(assuming warrants in the money)= .61eps

So today's price 4.43/.25=17.7 p/e ttm
2007 4.43/.38= 11.65 forward p/e
2008 4.43/.61= 7.26

Is there another PR with different company guidance?