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To: Proud Deplorable who wrote (120196)	6/24/2008 11:11:53 PM
From: Land Shark	Read Replies (2) \| Respond to of 312815

2000 ton/h processing facility = $1.5 Billion/yr cash flow @ $100/ton price. S.P. @ 5 * cash flow would be $1.5 B * 5/20 MM = $375/sh. S.P. will be limited by cash flow and not resources. Resources are virtually unlimited. So the economics will favor large scale processing plants. Of course, they'll start small and fund the larger operations with the cash flow from the initially small streams.

To: Proud Deplorable who wrote (120196)	6/24/2008 11:13:31 PM
From: Rocket Red	Read Replies (3) \| Respond to of 312815

Decline in output likely to push up coking coal prices June 10, 2008: By Arnab Mallick: The coking coal market is seeing a lot of action in recent times. There has been an agreement on record annual contracts price of over $300 per ton. Also, major steel makers are acting fast to secure supply of this very important raw material. Steel Insights, June 08, coking coal The recent loss of production due to floods in Australia this year has created a panic situation in the market and the poor condition of infrastructure has aggravated the scenario. The floods, which had cut output from mines owned by BHP, Rio Tinto Group and Xstrata Plc, may cut supplies by 12 million to 15 million tons, noted a recent Macquarie report. This had to take its toll, which is being witnessed at the moment. Another worrying factor that will surely push up spot coking coal prices in China is the decline in production. That is because small mines in Shanxi province are being shut down for a safety campaign ahead of the Olympics. It is worth noting that more than 50 percent of coking coal is produced by small and medium sized mines and therefore such a measure will surely tighten the market further. According to a recent international media report, spot price of prime coking coal has already gone up by 15 percent in the past few days. China's Import Decline in April 08: China's import of metallurgical coal in April 2008 stood at 531,000 tons 9.6 percent lower than previous year's comparable figure. Consequently, the cumulative import figure touched 1,744,590 tons as compared to previous year's comparable figure of 1,777,013 tons. On the other hand, the country registered a marginal 0.2 percent (y-o-y) growth in export in coking coal in April 2008 at 308,856 tons. NSW's Coking Coal Imports Firm Up: Coking coal export from New South Wales (NSW), Australia however recorded 21.9 percent y-o-y increase during January-March 2008 at 4.58 million tons as against previous year's comparable figure of 3.76 million tons. "The government will enact tougher measures for small coking coal mines, which will further tighten supplies," said an analyst at a large state-owned securities firm. On the back of it, China's own coking coal demand is very strong. This will also result in a significant rise in coke prices as well, which is now expected to touch even $650 per ton. According to market sources, Indian buyers were even being charged $580 per ton fob for Chinese coke last month. A recent media report quoted Luiz Sarcinelli, director of Rio de Janeiro-based coal consulting company Sage Consultoria Tecnica Ltd saying, "Coke, used in blast furnaces to make pig iron, may rise to $650 a ton on a free-on-board basis from China." According to Cia. Vale do Rio Doce directors Renato Paladino and James Pessoa China may also boost coking coal imports to 40 million tons in 2010. It has also been learnt that there will also be a surge in demand from Brazil as some of the major steel making projects go onstream. This will add fuel to the existing high demand in the current tight coking coal market, perhaps not in the immediate future. Meanwhile, the world's largest steelmaker ArcelorMittal bought a 14.9 percent stake in Australian coal producer Macarthur Coal Ltd. This move is primarily to secure raw material supply for steel making. Macarthur is one of the biggest producers of pulverized coal. Following the similar trend, another major steel maker Nippon Steel Corp. is seriously exploring investing opportunities in Cia. Vale do Rio Doce's $1.4 billion planned coal mine in Mozambique. In the mean time, negotiations about long term agreement are still on between steel makers and coal miners. The Tex report reported that the negotiations between Xstrata Plc and Japanese steel producers about Australian supplies of semi-soft coal have not yielded any results. However, contract negotiation of long term metallurgical coal of Chinese origin for the fiscal 2008 seemed to have been completed, according to the report. The agreement was reached between Japanese BF steel producer and China National Coal Group Corp on hard coking coal producer in Shanxi Province. The contract prices were fixed at an average price of $300 per ton for different brands. Macarthur Coal has also concluded a long term agreement for supplying LV PCI coal produced in Queensland with Hyundai Steel Co. Ltd of South Korea. For reference, the new contract for fiscal 2008 has been raised to $235 to $245 per ton fob from last year's comparabale price of $170 to $180 per ton, noted the Tex Report. Near about the same time, Australia's Wesfarmers Ltd had more than tripled the price for Curragh mine coking coal. As per market reports, the company will charge as high as $300 per ton for the same. There is no major good news on the supply front apart from Australian producer Gloucester Coal Ltd which has made significant new coking coal discoveries in the Gloucester Basin in New South Wales state. There is news that Rio Tinto Group may double coal production from Queensland by 2015. Rio's output of hard coking coal, used in steelmaking, fell 27 percent in the first quarter after weather disrupted mining in Queensland. Outlook Jim Lennon Macquarie analysts in a recent report said that the price of hard coking coal may remain at $300 a ton for the year starting April 1, 2009. But some producers are also demanding up to $350 a ton this year, higher than the benchmark set by BHP Billiton Ltd. In a nutshell, the market is in a severely tight state. The condition is likely to get even worse if production of China reduces because of shutting of small mines. Source: Steel Insights