LCK (ASX) What is it really worth?

Originally posted by MarketingMan: ↑

My Estimate for 2P = 816 Pjoules

The current 2C Estimate is based on...
377 Million Tonnes (of coal) X 65% Geo Risk X 80% Process Risk and 15.2GJ syngas per tonne of coal = c. 3000 Pjoules

How much of the 377 Million Tonnes will be included?
Only the middle seam ("Main Seam") will be included in the 2P upgrade.
Looking at the coal seam cross section, it looks to be the larger of the 3 seams, so I am estimating it is 38% of the available coal.
However, LCK will not be gassifying the full seam as it will require them to be operating ISG chambers too close to ground level.
Therefore I am assuming they will only have access to 60% of the coal in that seam.
So, of the total LOBE B coal, I am basing my calculation on 22.8% of the coal identified in the last JORC.

Geo Risk
I am assuming that 65% Geo Risk is industry standard, so I am going with that.

Process risk
Now that LCK have run their PCD and the results sound good, I am upgrading process risk to 82% (from 80%)

Coal tonnage
I am anticipating that LCK have had an opportunity to reassess the JORC and will increase the coal tonnage by 8% (a guess).
So my calcs are based 407,160,000 tonnes.

Energy yield
I am expecting that LCK PCD trials have identified an improved energy yield, so I am upgrading that slightly to 16.5 MJ/tonne of coal

So my 2P estimate is...

407 Million Tonnes X 22.8% X 65% Geo Risk X 82% Process Risk and 16.5 GJ syngas per tonne of coal = 816 Pjoules

Further upside
Of course, when they announce the 2P they will also provide a revised estimate for the remaining 2C resource estimate so we are likely to see the total improved with the new numbers.

Within the PEL650 area there are other areas to the South and North of the LOBE B coal body, LCK has the opportunity to develop these regions as well. I expect the total resource will be eventually upgraded to close to 5,000 PJ during the life of the project.

Just my estimates.
The announcement should be out before the end of March, we will find out how close I am.

IMO
DYOR

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Wel then that means gas in ground is worth 816 million. That's a nice MC

What is it really worth?, page-111