I thought new hope coal hc followers might be interested in a post I did on the MNM (Mantle Mining) threads this evening in relation to NHC's sale of the new saraji project to bhp....
Post #: 3126502 In Reply to msg: #3126275 IP: 124.148.xxx.xxx Sentiment: ST Buy Disclosure: Stock Held Views: 2
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frosty, the million dollar question ! What's a company worth? What is Mantle's coal worth? From their last quarterly, New Hope Coal seem to be in the stages of resource identification with the 690mt and a target of plus 1.5bn tonnes. The sale to BHP is outstanding in terms of the Australian coal industry and should be major headlines in the papers tomorrow. I just happened to stumble across the news on the Yahoo finance pages earlier this evening. What a chance find !
The New Hope Coal (NHC) sp closed today at $4.37 and was about $1.70 in Jan 08, 59c in nov 2003, $1 in june 2004 and $1.47 in January 2007. They listed on the 16th /09/03 with about 706m shares. Now, with about 808m shares on issue, two open pit coal mines west of bris and a 17.8% interest in Arrow Energy (worth $223m) at the time of the reports on their website. The news tonight has not been released on the asx yet, will be tomorrow no doubt. The enterprise purchase value is worth about $2.07 per New Hope share. If the new saraji coal resource is worth $2.4bn cash to bhp with 690mt, Mantle's Mt Mulligan with 500mt but without the synergies of BHP and the Mackay port ( 395km away by rail), let's say a guesstimate of Mantle's 500mt of coal being one third of the estimated 1.5bn tonne New Saraji resource target (worth $2.4bn to BHP), is about $800m and divide by say half that, to be conservative for the different synergies and port and rail issues......and divide it again by 2 for no particular reason but to be super conservative....... we get $200m for the 500m t Mantle Mt Mulligan coal resource on a sale as is basis. This works out at about $3.44 per share based on Mantle's 58m shares as at 28th May 08. This is just for the Mantle's coal and very conservative and very hypothetical as there is a lot of water to go under the bridge. What we do know, like New Hope's new saraji coal resource ( now BHP), is that Mt Mulligan has coal as it is a previously working coal mine and the estimates of 500mt would be pretty well accepted as a current resource. So, what's the value per MNM share? Answer, around $3.44. Which is a bit of a shock to a lot of people I'd expect and makes no allowance for what Mantle's other resources are, eg, the 25 phosphate targets ( what's the estimate per share that they might be worth, watch this space ), the coal seam gas at Mt M and the gold around Charters Towers ( ?).
From their last quarterly report....
"New Saraji Project A 2D seismic survey was initiated, including 4,913 metres of open hole drilling for explosive charge placement. The program is designed to test 2D and 3D seismic techniques and their applicability to underground longwall mine planning for New Saraji. Minor open hole drilling of 531 metres was completed as part of the ongoing resource definition program. Analysis, interpretation, modelling and planning continued with the results obtained from previous year’s drilling programs, including a revised assessment of reserves and resources in accordance with JORC definitions."
they export 2mt per annum, 65% IS EXPORTED, 35% DOMESTIC, 9 months production is 5mt and sold 2.7mt.
See below for a NHC company presentation....Saraji is from page 46 onwards... There's lot's more I could post but that's enough for the moment. These are just my thoughts, dyor etc. http://www.newhopecoal.com.au/media/5166/20080414qldoperationsvisitpresentations.pdf
NHC Price at posting:
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