This region is a prolific thermal coal region with operating coal mines in the area. Assuming the market agrees a timetable will be formulated and the potential here is similar to HUN. Management is critical here, I ask myself do they have the experience?
Power demand from China alone makes this a sound longer term investment in my opinion. China will want to acquire this I have no doubt. Energy is key for China's dominance this century. This is why the Americans want to be in Afghanistan and other Gold rich, oil rich, coal rich areas referred to as the centre of the chessboard! (Geopolitical World)
Not to mention the coking coal demand in China! We can see by the planned infrastructure for this region the amount of investment in this industry for Mongolia and China.
Infrastructure is a key factor here for investors to factor in. Even with all the money and licenses ROB in my opinion is a go ahead because the laws and support of the Mongolian and Chinese Government.
Looking at what China wants from Mongolia tells us in many ways more then what Mongolia wants! Strategic location and planned rail all make this license why there will be a re-rate here IMO. The company can see the opportunity here and I am sure is quietly confident.
I have to admit I like coal as an industry as world demand is going to grow quite rapidly over the next decade.
Cyan even a re-rating of 1.5c to 2.5c would be a significant milestone here don't you think? I think it will break 3.5 for a number of reasons, one might be people at 3.4 and 3.5 may, this is just a guess but I have seen this happen, cancel their orders to sell because they want to enjoy the run. This is obviously all speculation by my part!
Because the fundamentals are stacking up here ROB could see a real push here up to 4.5c to 5.1c. The volume and the license make for interesting bedfellows! What do you think?
If you liked what I said let me know by voting!
PS - This is all just my research, guesswork and opinions and should be taken as the fun it is... Though I don't own yet I am thinking about it and share my thoughts because I love research for its own sake. (Sorry I'm a bit of a geek!)
Kind Regards
ROB Price at posting:
3.0¢ Sentiment: LT Buy Disclosure: Not Held
