PRC Pike River Coal

[JoeBlogs]

NZD is way over valued (or more accurately USD way undervalued) at these levels. Look for 0.60-0.65 c over next year. However this may well coinside with short term pressure on HCC spots. Either way it doesn't really matter, as PRC has a lot of upside potential - they just have to do what they say the're going to (I know that's the gamble in light of recent performance).

[dsurf]

Best thing PRC can do is send a 10K shipment to the indian shareholders. Then they can point out they have a buyer for 70% of what is produced & will have some revenue. The prospect of returning to the market for funds yet again will then drop & the SP should recover towards where an operating mine would be. Of course I have been waiting years for that to happen!!!

[COLIN]

""Pike was expecting German manufacturer Wirth to be in New Zealand early next month to help deal with an issue with their coal-cutting machines. The tracks on the machines had been breaking, although this problem had not been as bad recently, Dow said.""

once the miners learn to turn on the cutting heads and stop using them as battering rams, the tracks wont break and then mining can really comence...
i do feel for the miners though..... those german manuals are hard to read.

I like your sense of humour! And I hope the miners are instructed not to mention the war!

However, it is a worry that this German-made equipment seems to be giving so much grief, given the German reputation for world-leading high quality machine workmanship. One would assume that Pike only bought equipment that had been well and truly proven in similar conditions elsewhere. Perhaps they should have gone Taiwanese.

[DTB]

I like your sense of humour! And I hope the miners are instructed not to mention the war!

However, it is a worry that this German-made equipment seems to be giving so much grief, given the German reputation for world-leading high quality machine workmanship. One would assume that Pike only bought equipment that had been well and truly proven in similar conditions elsewhere. Perhaps they should have gone Taiwanese.


You're right, it is a worry. Maybe this mine is not like any other in the world and they are therefore on a steep learning curve. As someone else has already said, it may not even be a viable mine.

Upside potential is all very well, but what about the downside while you're sitting there for the next year (at least), waiting for production to get up to capacity?

Plenty of other opportunities for your money...

[neopoleII]

just checked out the company website for the continuous miner,
very impressive machine.
http://www.wirth-europe.com/

[Dr_Who]

Dont get too excited yet guys.

There is still alot of uncertainty.

1. Will there be further delays? From their track record to date, the odds are they wont be able to meet deadline.

2. Will they need capital injection to continue? The cash is running out fast.

[patrick]

If the Company can count the rats and stoats then they should know, and tell the owners, how much coal is stockpiled.

[Billy Boy]

If the Company can count the rats and stoats then they should know, and tell the owners, how much coal is stockpiled.

I completely agree Patrick !!
and which side of the hill ??
and how much comes out per week ??
B Nice 2 no wood'ent it
BB:)

[fabs]

Same outfit some years ago was busy in Goldmining, till everything turned to custard, billions worth of Gold in the Tanamei, Waihi and Beaconsfield Mines, when bad luck equipment failure and litigation, made the lot end up in Brierlies GPG for a song.
SOLID ENERGIE silently watching!


Dcl. only hold through NZOG

[JMJ1202]

Is it just me or are we starting to see more information coming to market about PRC?

We've had the recent McDouall analyst review, PRC press article about the future price of coking coal and production at the mine and I heard today that AMP Capital are covering PRC and the quality of their coking coal in their market presentation.

Still finance and production issues to sort out (priced in to current SP imo) but, pardon the pun, I can see light at the end of the tunnel!

Admittedly, communication from management has been poor but, when it's all going wrong, human nature is 'heads down' and hope nobody notices. When things start going right, then you start talking about it!

[Nitaa]

Coal prices may (not) rise next year ..only negates if the NZ$ stays above 72USc and strengthens further....
Market seems to have factored in all these short term uncertainties at about 98c/shareYea i think the market has factored this into it. What concerns me is what the company is not saying rather than what they are saying.

It all seems to be painting a rosey picture but what is not being disclosed is what bothers me. How about some actual production figures. eg first month, second month production etc. Its not rocket science. Based on what they havent disclosed just raises too many red flags.

disc. i dont hold but i do.. through nzo and i am not getting overly excited about it. sorry if i havent been sharing other peoples optimism about this stock.

[the machine]

I like your sense of humour! And I hope the miners are instructed not to mention the war!

However, it is a worry that this German-made equipment seems to be giving so much grief, given the German reputation for world-leading high quality machine workmanship. One would assume that Pike only bought equipment that had been well and truly proven in similar conditions elsewhere. Perhaps they should have gone Taiwanese.


tracks made in vietnam though

M

[JoeBlogs]

Good news on the way? Price action is interesting, and we know what that means with PRC.

[patrick]

Joe,
Yes.The company have decided (perhaps) to follow the same practice as they did on tunnel progress and report tonnage of coal produced each day.

[JoeBlogs]

Where did you get that info? Am I missing something? There have been no recent announcements.

[manxman]

October 17 is the first anniversary of first coal. There may be an announcement of total production for the first full year.

[Nitaa]

Good news on the way? Price action is interesting, and we know what that means with PRC.Sorry to put it into reality but there is only just over 100k worth of shares traded. Its not to say that good news is not on the way but it is impossible to read anything into todays action or lack of it

[JoeBlogs]

there is only just over 100k worth of shares traded

True, but insider trading doesn't generally involve the masses :rolleyes:

[Baddarcy]

Sorry to put it into reality but there is only just over 100k worth of shares traded. Its not to say that good news is not on the way but it is impossible to read anything into todays action or lack of it

I agree with Nita, volume is too low for anything substantial, just market fluctuations i think.

But being a holder of PRCOA, i hope i'm wrong :)

[Hoop]

Hmmm...yes agree volume is a key factor in the schemes of things.

Some investors "wanting in" may have been waiting for TA buy signals to emerge. The buy signals were starting to ping off a couple of days ago so it seems the braver souls are getting in but there are even fewer sellers.

.......she's away.... gone up another 2c...momentum starting to build as I am writing this post...more sellers entering in now.

A good example of entering a stock using TA...eh:)

[JoeBlogs]

Would PRC be a potential takeover target?

Some of the speculation may be surrounding the vast amounds of NZD purchased by offshore investors yesterday. Extreme long shot of course.

Again, piddly little volumes - infact the OAs nearly out-trading the stock! I tend to agree that this is mainly TA driven. Either way, I'm liking it.

[Billy Boy]

Maybe they are going to announce production and stockpile figures.
:):):)...:rolleyes:.... here's hoping :):):)

;)
Cheers BB:)

[patrick]

Billy Boy.
Admire your optimism.

[Robomo]

Just released by Bloomberg today

http://www.bloomberg.com/apps/news?pid=20601081&sid=a7IKXT8W2Lnw

Goldman Raises Iron Ore, Coking Coal Price Forecasts

By Jason Scott and Rebecca Keenan

Oct. 7 (Bloomberg) -- Goldman Sachs JBWere Pty increased its forecast for iron ore by 9 percent and metallurgical coal by 16 percent as China’s demand rises amid tighter domestic supply.

“A key driver of our more bullish view is our belief that global crude steel production will rise by 12 percent in 2010 to a record 1.4 billion tons,” analysts led by Malcolm Southwood wrote in a report dated yesterday. “Raw materials constraints will become more acute in 2010, putting suppliers in a strong position to negotiate higher prices.”

Iron ore fines may reach $72 a metric ton in 2010/2011, up from an earlier forecast of $66 a ton, the analysts said. Hard coking coal may climb to $180 a ton, up from an earlier forecast of $155 a ton, according to Goldman Sachs.

Demand for the steel-making ingredients is being driven by China as a 4 trillion-yuan ($586 billion) stimulus package boosts manufacturing and building. The government commodity forecaster in Australia, the world’s biggest shipper of iron ore, last month said China may buy 20 percent more of the material next year than forecast in June.

“This year’s record growth in Chinese imports will more than offset the collapse in demand elsewhere,” Goldman said in the report. Next year, continued strength in China coincides with a recovery in Organization for Economic Co-operation and Development nations and tightening supply chains, it said.

Risks to Chinese steel output include the prospect that production has run ahead of underlying demand and falling prices, the report said.

[Billy Boy]

[quote=JoeBlogs;276411]Would PRC be a potential takeover target?
quote]

Not to be laughed at.....and not yet of course. But its good stuff...so?.
I hope not for quite a bit coz talking with the top boys, PRC have no
intentions of stopping just at pike. So once an established cash flow
and 50% (If I remember) retained earnings. Look out ... Solid Energy
maybe ??.... or ???
Hmmm......
the reason I have a large-ish holding both heads & options. Might
increase both. Would have done a ways back except for the "black
hat" suprises. PRC have gotta communicate with it's small owners for
Gods sake !!!
BB:)

[JoeBlogs]

Reasonable volume early. Could this finally be the start of the next decent up leg? We are due some news about funding and production, hopefully this week will bring some positives.

[Baddarcy]

Unfortunately i think this is just a mini bubble for PRC and i think it will shrink back towards 100 over the next few weeks.

The Aussie mine stocks had a bit of a jump last week on the news of the spot prices for coking coal rising adn this pulled PRC with it.

But they are producing mines where PRC isn't yet and i think the volume we saw yesterday is some investors realising that and selling and pocketing a nice little profit if they purchased when it was in the high 90's.

But as a PRCOA holder, lets hope i am wrong and it is a start of a long term up trend :) But if i am correct then in a few weeks i can pickup some more at about a 100 for PRC or 22 for PRCOA :)

[Dr_Who]

Sold out of PRC.

Dont believe any hot air that comes out of managements mouth.

I prefer to put my money with the Aussie coal miners that dont talk BS.

[Balance]

For those who think it's a walk in the park for PRC once and if they finally produce coal, Solid Energy's results give food for indigestion.

Solid Energy profits, dividends well below forecast
3:00PM Wednesday Oct 14, 2009

2009 Financial results

Solid Energy has reported a record $110.8 million profit in the year to June 30, but the state-owned enterprise is disappointed because it is below half of forecast.

The coal miner had planned to pay the Government $100m in dividends but managed to pay $59.9m.

The profit was up from $34.37m last year.

It was a difficult year with hard coking coal prices falling from US$300 ($414.93) a tonne to US$100 a tonne as the global economy slowed.

"Customers began to defer export shipments and seek substantial price reductions," chairman John Palmer said.

Solid Energy held an annual "stakeholder" meeting in Wellington today at which security guards outnumbered protesters.

There was no disruption during the meeting this year. Last year chief executive Don Elder fended off a cream pie thrown at him.

This year the company was criticised for "spin" on its environmental record and asked for a guarantee of domestic coal supply. The company did not provide a guarantee and rebutted the suggestion of spin.


The stakeholder meetings are designed to improve transparency and are like company meetings. The meeting was attended by State-owned Enterprises Minister Simon Power.

[Sehnsucht888]

They still made a profit... Just not one that they probably estimated when prices where at the peak, before the crash.

Not many companies made the profits they expected/hoped for... No surprises here, they just didn't provide sensible revised forcasts....

[Balance]

They still made a profit... Just not one that they probably estimated when prices where at the peak, before the crash.

Not many companies made the profits they expected/hoped for... No surprises here, they just didn't provide sensible revised forcasts....

Sigh. The market values and price a company's shares on its forecasts. If a company comes in at 50% of forecast, guess what happens to the share price?

[Sehnsucht888]

Sigh. The market values and price a company's shares on its forecasts. If a company comes in at 50% of forecast, guess what happens to the share price?

Yeah, but my point is that these aren't unique cases. The same happened to lots of companies, so it is unfair to single them out. yes there are parralels with Solid Energy, but there are also the same trend with many other companies in other industries also hit by the GFC.

It all depends on what was used for the forcasting, how conservative it was, and what actually happened. A forcast 6 months ago could be substantially lower than the result will be in another 6 months tdue to improvements.
If we expect global recovery, then the key is to look ahead, not at previous results during a major crisis. The last year is not a good measure of the next.

[JoeBlogs]

Small, undiversified mining company forcasts are always going to be subject to larger degrees of change than other types of companies. If you're not willing to accept that, you shouldn't be investing in them. Having said that, it's fairly well known that solid energy is not one of the better companies of this type in the world.

PRC advise a market update is planned for next week.

[Balance]

Yeah, but my point is that these aren't unique cases. The same happened to lots of companies, so it is unfair to single them out. yes there are parralels with Solid Energy, but there are also the same trend with many other companies in other industries also hit by the GFC.

It all depends on what was used for the forcasting, how conservative it was, and what actually happened. A forcast 6 months ago could be substantially lower than the result will be in another 6 months tdue to improvements.
If we expect global recovery, then the key is to look ahead, not at previous results during a major crisis. The last year is not a good measure of the next.

The point is that some investors think that once the coal finally start coming out of the ground, life for PRC will be all champagne and caviar. Solid Energy shows that NOT to be the case.

Forecasts are just that - forecasts.

[Baddarcy]

I'm a little surprised that the NZ Dollar hasn't had much effect on this stock. Given that 100% of PRC's income will be in USD and the price has been fixed already i would have thought that the appreciation of the NZD (or drop in USD is probably a better way of putting it) would have hurt this stock.

But it doesn't seem to be having any effect on PRC at all?

[sideline]

I'm a little surprised that the NZ Dollar hasn't had much effect on this stock. Given that 100% of PRC's income will be in USD and the price has been fixed already i would have thought that the appreciation of the NZD (or drop in USD is probably a better way of putting it) would have hurt this stock.

But it doesn't seem to be having any effect on PRC at all?

Quite a bit of its debt (US Liberty Bonds) are in US$ too, so nicely hedged!

[patrick]

Only just over a month till the AGM.
Time for shareholders to give thought to questions for the Directors?
Not able to get to the meeting myself but contributions here will help those able who attend.

Disc: hold 90k shares and 300k options

[Sehnsucht888]

I'm a little surprised that the NZ Dollar hasn't had much effect on this stock. Given that 100% of PRC's income will be in USD and the price has been fixed already i would have thought that the appreciation of the NZD (or drop in USD is probably a better way of putting it) would have hurt this stock.

But it doesn't seem to be having any effect on PRC at all?

PRC has had so much bad news, the price has been punished a lot. With the impending decent production (lets hope), there is possibly some tentative support. If they can actually have some good luck and get some decent volumes out there, then hopefully it will be up from here.
The complicating things are the price they will get for coal, which for this year was set much lower than last year, but is looking to increase again, but who know by how much. That may offset the FX effect.

Its all best guess at the moment, till stuff actually happens.

[whirly]

http://www.pike.co.nz/files/shareholder_reports/Qtly_activities_Sept09.pdf

Of note:

"Notwithstanding the substantial operational improvements gained over the last two months, the resultant push-out of dates for first deliveries of coal and resultant sale proceeds has increased working capital requirements, which management and the Board are actively addressing. Indicatively, existing funds and loan facilities will need to be bolstered with additional cash to meet operational outgoings in the first half of 2010 by approximately NZ$20 million.
The optimal means of obtaining these funds is being addressed which may include additional debt or equity. The company has engaged a specialist international coal industry commercial adviser to pursue certain funding options. That party’s opinion is that there would be strong interest from international coal customers in securing a long term coal offtake agreement at competitive market prices in the present buoyant climate for hard coking coal, and that may also include a share placement which may be at a premium to the company’s present share price."

[the machine]

the quarterly report includes a production quantity [at long last]

but can't see sp doing much until the liberty thing is resolved

M

[Robomo]

Out of the blue a few minutes ago: Walter Energy in the USA predicts....
"Walter expects to ship 126,000 tons of hard coking coal at a price of $315 per metric ton in the fourth quarter. Coking coal production is expected to be between 1.4 and 1.5 million tons in the fourth quarter.

Walter Coke is expecting improved sales and a return to profitability in the fourth quarter, driven primarily by increased orders from the domestic steel industry".

Considering that other commentators are predicting $170 - $200 per ton that is a huge increase!

http://www.rttnews.com/Content/BreakingNews.aspx?Node=B1&Id=1099271%20&Category=Breaking%20News

[Rabbi]

A very comprehensive report all the same but probably still leaving people wondering what else can go wrong. Nothing here to cause a selldown but I would expect most punters will take a wait and see attitude. The best question is, how fast can PRC ramp up production, and once the hydro mining does start, how much can they produce?:rolleyes:

[Placebo]

http://www.pike.co.nz/files/shareholder_reports/Qtly_activities_Sept09.pdf

Of note:

"Notwithstanding the substantial operational improvements gained over the last two months, the resultant push-out of dates for first deliveries of coal and resultant sale proceeds has increased working capital requirements, which management and the Board are actively addressing. Indicatively, existing funds and loan facilities will need to be bolstered with additional cash to meet operational outgoings in the first half of 2010 by approximately NZ$20 million.
The optimal means of obtaining these funds is being addressed which may include additional debt or equity. The company has engaged a specialist international coal industry commercial adviser to pursue certain funding options. That party’s opinion is that there would be strong interest from international coal customers in securing a long term coal offtake agreement at competitive market prices in the present buoyant climate for hard coking coal, and that may also include a share placement which may be at a premium to the company’s present share price."

Dear God! More delays and More equity-raising!! For heaven's sake they have only just completed a $40m -plus equity raising programme. Now they are saying they need another $20m. And they are talking about doing a deal with a potential customer, who no doubt will get a cut price in return and capture the value that should be due to long-suffering shareholders!!

When will the frustration end???

[the machine]

well mr market liked the report with a 5c au gain today

M

[glennj]

Dear God! More delays and More equity-raising!! For heaven's sake they have only just completed a $40m -plus equity raising programme. Now they are saying they need another $20m. And they are talking about doing a deal with a potential customer, who no doubt will get a cut price in return and capture the value that should be due to long-suffering shareholders!!

When will the frustration end???

The frustration will end if they produce and sell the revised volumes of coal at the right price in a timely manner. Unfortuneately they have failed so far. I don't see this latest glitch as an opportunity and advise potential investors to steer clear until there are runs on the board.
I sold the last of my holdings (at a profit) when I knew that the original delivery schedules could not be met but public communication about the situation was not forthcoming.
There are still geological concerns that were initially being down played but were highlighted quite recently in an analysts report.

[dsurf]

On the positive side:

8m tonnes more of resources at approx $300 $NZ = gross revenue of extra 2.4 bill. Of course that will not all be profit and will be a long time coming however at 10% profit margin then the resources upgrade is worth $240 million NZ$ or 68c a share (350 mill on issue). I think that may be what the market likes.

[boysy]

its a bit simplistic to say the upgrade is worth NZ$240 considering time value of money and opportunity cost of capital dont you think ?

[dsurf]

Of course it is too simplistic, however the fixed costs will already have been spent developing the larger seam. 10% assumption seems more realistic than 0% for 8mill tonnes of coal for an operating mine?

[fabs]

Dash it,
real tonnage by April yeah, that is right in the flying pig swarming season.
Looks like NOG or for that matter S/H will not get any benefits out of this lot till 2013-14with any luck.

Dcl.
Hold no PRCs direct only trough NOG

[the machine]

with 14,000t stockpiled and production expected to be approx 15,000t / month prior to hydro mining in 6 months time then somewhere in middle is an increasing production rate.

to meet 20,000 - 30,000t shipment in first quarter 2010 requires that level of production as rail siding needs to be stockpiled and lyttleton needs to be stockpiled, over and above the shipment.

might be wishful thinking but 1,000/week next 4 weeks, 1,500t per week to end year, 2,000t week jan & feb = approx 26,000t production over next 18 weeks.

we might be lucky and prc taking a very conservative view [understate and overdeliver] and first shipment ends up being early in 1st quarter. about time luck turned around to favour the shareholders as it has not happenned thus far.

on another note, the quarterly on asx looks 100 times better than nzx

M

[winner69]

on another note, the quarterly on asx looks 100 times better than nzx

M

Sign up with My NZX at www.nzx.com and all the announcements in real time with all the documents attached ... and free

PRC quarterly report in all its glory ... colour and all

[freddy]

Mcquarie have a analyst report listed on PRCs website with $1.05 target price. Has anybody read it? Only 2 of last 6 reports have a buy recomendation... That has changed I think.

[blockhead]

From NZO AGM, I didn't know about the "Graben" seems like a helluva lot of extra work to clear it and get on with mining, sobering reading this is;




Pike River Coal
It was a year of both achievements and setbacks for Pike River Coal, the
former NZOG subsidiary in which we still retain a shareholding of just under
30%.

In October 2008 Pike became an operating coal mine. It then suffered a
setback when a ventilation shaft partially collapsed, delaying production.
There have been further production issues since then.

A graben has been encountered immediately to the west and north of the pit
bottom and Pike is having to drill and blast through non-productive rock to
get to the coal seam.

It is unfortunate - if the graben had been further away from the pit bottom,
the mine development could have gone around it. Having to drill and blast has
delayed production - but it is not expected to be material in terms of the
total coal resource or the life-of-mine performance.

The first coal shipment is now scheduled for the first quarter of 2010. Of
course Pike has capital requirements to be met which need funding until Pike
is cashflow positive. In April of this year, NZOG and other shareholders
supported a successful rights issue. Last week, Pike announced it has further
short-term funding requirements and is exploring several options to meet that
need.

As a major shareholder, NZOG would have liked by now to have seen sustained
production from Pike. It is in the nature of the mining business that there
are surprises and obstacles to overcome.

Pike has proven itself to be competent at addressing the obstacles and we
remain confident in the mine's future.

[Xerof]

Ironic that we learn about this second hand, not from that fabulous PR team at PRC

Someone raise the cone of silence please

[Hoop]

Finally the internet outage has ended. Between the phone companies and the coal mine I feel like a mushroom. No need for any of this.

[glennj]

[quote=blockhead;279485]From NZO AGM, I didn't know about the "Graben" seems like a helluva lot of extra work to clear it and get on with mining, sobering reading this is;

quote]

That they were encountering rock where coal was predicted is old news. A couple of my earlier posts alluded to this.

"I'd be wary of this company until they have the runs on the board so to speak and only buy if they stack up in FA terms.
There may be more to this than machinery & training issues. Is there as much clean easy mining coal as predicted in the places they predicted it would be? " & "Note there have been geological problems"

Bit sad that their communication/pr has been poor/misleading especially with the late announcement of material matters.

I'm no longer a holder except thru NZ Oil & Gas.

[Balance]

What other problems lay ahead?

[winner69]

What other problems lay ahead?


Maybe some rock overhangs

[Baddarcy]

Ironic that we learn about this second hand, not from that fabulous PR team at PRC

Someone raise the cone of silence please

The Graben was mentioned by PRC in their Quarterly Report released last week.

I can't put my finger on it but i read it previously in a report to the NZX over a month before that too.

[Xerof]

You are right - apologies to PRC PR. My arrows are back in the quiver.

[Rabbi]

I was in Greymouth last weekend so I interviewed three different people re the problems at Pike river.

The first was an ex solid energy miner, who dismissed Pike River as a "brothel" and advised me to get rid of my shares immediately. He seemed to think most of the staff were incompetent and the mine was nothing more than a glorified bombsite.:(

The second was a Pike Employee-one of the Under viewers He said most of the issues Pike was faced with at the moment could be overcome, and ultimately the mine would make money. He described Peter Withall as "pretty astute"and he was confident about the long term future of the mine.:)

The third was one of Solid Energies' management team. While admitting Pike River had problems, he attributed this to various causes, including bad luck, inexperienced miners and lack of equipment or equipment not in working order. He stated Pike was a long way behind Solid Energy in trained staff and Technology . However, he was also of the view that the long term future of the mine was sound, once they go things up to speed, and the workforce became more experienced.:cool:

All this out of the mouth of three horses, which one to believe?!

[Balance]

I was in Greymouth last weekend so I interviewed three different people re the problems at Pike river.

The first was an ex solid energy miner, who dismissed Pike River as a "brothel" and advised me to get rid of my shares immediately. He seemed to think most of the staff were incompetent and the mine was nothing more than a glorified bombsite.:(

The second was a Pike Employee-one of the Under viewers He said most of the issues Pike was faced with at the moment could be overcome, and ultimately the mine would make money. He described Peter Withall as "pretty astute"and he was confident about the long term future of the mine.:)

The third was one of Solid Energies' management team. While admitting Pike River had problems, he attributed this to various causes, including bad luck, inexperienced miners and lack of equipment or equipment not in working order. He stated Pike was a long way behind Solid Energy in trained staff and Technology . However, he was also of the view that the long term future of the mine was sound, once they go things up to speed, and the workforce became more experienced.:cool:

All this out of the mouth of three horses, which one to believe?!

So far anyone who bothered to listen to the old timer Western Coast miners has saved themselves a lot of bother.

Unless they are traders - PRC is helluva trading stock. Just follow the company's PR & BS - do the opposite.

Remember they think investors and shareholders are mushrooms.

Are you?

[leecoker]

Pike River Coal has the potential to expand its West Coast mine with an estimated 8 million tonnes of high-quality coal from three additional coal seams.

Pike River is currently extracting coal from the Brunner seam. Recent testing of the Paparoa seam 200m beneath it shows plenty of high-quality coal.

"It's a good sign; it's not definitive, we can't really base an economic model or a extraction sequence on it yet, but it's encouraging because it means that there is good quality coal down there. There is quite a lot of it," said Peter Whittall, general manager of mines for Pike River Coal.

Though previous leaseholders, such as New Zealand Oil and Gas, knew the potential of the seam, the company was only aware of three seams, one of which was mineable.

"The Paparoa seam is also exposed on the surface along the mountain, so in the past people have been able to take samples of it, analyse that ... and take quality analysis of that coal," said Mr Whittall.

"So it was known to be good quality coal and was a good blending opportunity, mixing the two coals together of the Brunner and Paparoa seam in the future."

However, the Paparoa seam wasn't given much value because of the limited information available, until Pike River discovered there were nine small coal seams of which three are workable after it drilled a hole from the Brunner seam.

"It encourages us to drill more holes and continue to explore the Paparoa seam. There was more coal than projected."

Pike River Coal is doing more tests on the coal retrieved and will continue to explore over the next 18 months.

Mr Whittall said he doesn't see any investment decisions on the Paparoa seam in the near future as the company is focused on its Brunner seam operations. It plans to ship its first 20,000 to 30,000 tonnes in the January-March 2010 quarter.

If development does take place in the Paparoa seam, Pike River would have to go back to the Department of Conservation and get access permits.

"I don't see that there would be a barrier doing that," Mr Whittall.

The coal tested has high fluidity combined with strong swelling numbers, low ash and very low sulphur content, according to Pike River Coal.

[Balance]

Pike River Coal has the potential to expand its West Coast mine with an estimated 8 million tonnes of high-quality coal from three additional coal seams.

Pike River is currently extracting coal from the Brunner seam. Recent testing of the Paparoa seam 200m beneath it shows plenty of high-quality coal.



An alternative version :

"We need to keep talking blue skies as we are preparing the market for more capital raising.

We are of course struggling to get coal out of the existing mine. We are 2 years behind schedule and many many millions overspent.

We have struck unexpected problems. They are unexpected because we were in such a hurry to mine that we did not do a proper appraisal of the mining challenges. They are problems because we are also inexperienced and are learning as we go.

Meanwhile, we are lucky that there are a lot of mushrooms out there. We are very good at extracting money out of the mushrooms.

Please read our latest presentation to a conference in Hong Kong on 20th October. We did not mention that we are way behind schedule and are encountering all kinds of problems.

And it worked a treat. It's good to know that there are more mushrooms out there to be harvested."

[patrick]

BALANCE
Please be fair and give credit for the rat and stoat kill.

[dsurf]

Pike time = 3 x NOG time

Scary thought

[fabs]

Can anybody post the latest Article in The Headliner 29.10.09. VOLUME 31 NO 4 Re: NEGATIVE VIBES FROM VIETNAM?
Seems there was a pefect Window [ AUGUST -SEPT] to make QUITE A BIT OF MONEY

[glennj]

There was a headline in the Grey Star last week speculating that NZOG may be hawking their stake in Pike to Solid Energy. Anyone know any more?

Some Solid Energy involvement could be beneficial.

[friedegg]

There was a headline in the Grey Star last week speculating that NZOG may be hawking their stake in Pike to Solid Energy. Anyone know any more?

Some Solid Energy involvement could be beneficial.

if they do i hope its the same kind of overpayment they made with the rail buyback

[temuk]

There was a headline in the Grey Star last week speculating that NZOG may be hawking their stake in Pike to Solid Energy. Anyone know any more?

Some Solid Energy involvement could be beneficial.

just texted my mate that works at solid energy.

"Heard nuthin we on strike. dog"

[glennj]

There was a headline in the Grey Star last week speculating that NZOG may be hawking their stake in Pike to Solid Energy. Anyone know any more?

Some Solid Energy involvement could be beneficial.

A denial in tonights paper from PRC re a Solid Energy buy in. Though PRC may not necessarily be aware exactly what NZOG are doing re their stake.

As an NZOG holder I like the idea of the PRC stake going at twice what it's worth but it's unlikely to happen now that Cullen has gone & the kitty is bare!

[Wilkins_Micawber]

Article in the Sydney Morning Herald ...

http://www.smh.com.au/business/boom-comes-bouncing-back-20091108-i3h7.html

From the article, titled "Boom Comes Bouncing Back" ...

"THE dust has barely settled on the global financial crisis, but there are already signs the resources boom is well on track to eclipse its past highs.

Coal, the nation's top export, is also being loaded on to ships through Newcastle at the fastest pace in a year amid reports of surging demand from Asian buyers.

Economists say these increases - and reports of ships once again stretching into the horizon at key ports - point to a boom era in resources returning far more quickly than most expected.

In another sign of the return to boom times, Westpac reports that 77 ships are queuing up outside the Queensland coal port of Dalrymple Bay, where the waiting times are at near record highs.

The rebound in demand is expected to give a major kick to national income, with contract prices of iron ore and coal - worth tens of billions of dollars a year - set to recover in 2010 after falling by about a third this year."

[swissboy]

too far away for me to attend the AGM but hope somebody asks questions regarding the Liberty situation

[Anna Naum]

Must be about time for PRC to announce another delay in getting to full production!

[Corporate]

Must be about time for PRC to announce another delay in getting to full production!

or capital raising. Damn i wish Pike would just start selling the bl00dy stuff.

[Balance]

or capital raising. Damn i wish Pike would just start selling the bl00dy stuff.

SP has been drifting south and no news about Liberty. Bad news announcement must be due any day now.

My bet - more teething problems, more production delay and a capital raising to fund increased capex.

I do not expect Liberty to want to get repaid as they are on a great wicket - they enjoy increased interest rate and top ranking priority security.

[digger]

SP has been drifting south and no news about Liberty. Bad news announcement must be due any day now.

My bet - more teething problems, more production delay and a capital raising to fund increased capex.

I do not expect Liberty to want to get repaid as they are on a great wicket - they enjoy increased interest rate and top ranking priority security.

Who knows maybe NZO will buy out Liberty,with their mountain of US cash.Also did we not hear some time ago about more things going wrong that turned out to be non existant.Until we are informed otherwise we really just do not know,and the south drifting SP is just a market reaction and not necessarly a indicator that something is holding up production.
On a positive note i see today that China will increase its steel development several fold in the next 5 years,with obvious effect on Hard coking coal prices.

[Balance]

Who knows maybe NZO will buy out Liberty,with their mountain of US cash.Also did we not hear some time ago about more things going wrong that turned out to be non existant.Until we are informed otherwise we really just do not know,and the south drifting SP is just a market reaction and not necessarly a indicator that something is holding up production.
On a positive note i see today that China will increase its steel development several fold in the next 5 years,with obvious effect on Hard coking coal prices.

I think NZOG is trying to get out, not increase its stake?

If you wait to be informed by PRC about things gone wrong, you will always be two steps behind those in the know - that's the history with this company so far.

[Baddarcy]

Personally i am looking for 4 pieces of news out of PRC today:

1) Liberty Harbor, whats going on,
2) What the status of the $20 million they said they needed last month,
3) how much coal they now have stockpiled, last news about a month ago was 14,000 tonnes so am expecting about 17,000 now,
4) how far through the Graben have they drilled,

[Dr_Who]

Do you believe what comes out of the directors mouth?

I dont, hence I had sold out all my shares in PRC.

[Balance]

It was 3 months ago that PRC advised the market of further problems with the mine.

No update and the sp has been sliding away even as other coal miners in Australia has seen their share prices gone higher.

Enough said - looks like those in the know are selling down and out.

[Anna Naum]

Joke is that IF they could deliver the coal, there would be no problem. Aussie coal stocks doing well because they are delivering the black stuff.

[Anna Naum]

AGM speech and outlook just released.

http://www.pike.co.nz/news.php

[Anna Naum]

http://www.pike.co.nz/news.php

The Board is very carefully weighing up the alternatives for the additional $20 million working capital, which include debt and equity. These additional funds are not required until February next year.

We are also progressing an extension to the production condition applying to the convertible bonds (US$27.5 million or NZ $39 million at current exchange rates) held by Liberty Harbor, part of a Goldman Sachs asset management group. A technical review of key mining issues was completed last week by a technical advisor to Liberty Harbor. They have not identified any major concerns with our mine operation. Based on the response from Liberty Harbor to date, we believe the condition will be extended to 30 June 2010, although commercial terms are still to be addressed.

[bull....]

Mentioned long ago they would have lots of mine problems , but management continue to smooth talk over the issues.
Glad sold way back at over $2

[Baddarcy]

Personally i am looking for 4 pieces of news out of PRC today:

1) Liberty Harbor, whats going on,
2) What the status of the $20 million they said they needed last month,
3) how much coal they now have stockpiled, last news about a month ago was 14,000 tonnes so am expecting about 17,000 now,
4) how far through the Graben have they drilled,

Well i got answers to 3 & 4, but not really much about 1) & 2).

[Balance]

This was said :

"So with the mine on-track to hit its steady state production rate of 1 million tonnes per annum by mid xxxx, we are increasingly being asked – what next?"

trouble is, xxxx = 2009, and the speech was made exactly a year ago!

And they are struggling to come out with 5,000 tonnes a month! Let alone 85,000 tonnes a month!

SP continues to slide after today's comments - those in the know are selling.

[bull....]

Think those in the know sold moons ago.

[Anna Naum]

Think those in the know sold moons ago.

Nice, made me laugh

[Balance]

Hi all
I emailed Pike today, theres no foundation to Aoteas rumour, here is what they replied....

No there is nothing in any of that. I spent half my day today in
inductions with new employees and we have a whole bunch starting in
early September too. We are still very much going forward.

Regards

Peter Whittall

This email from PRC was dated 21 August 2009.

25 August 2009 - Announcement of production delay. First 60,000t was supposed to be mid-Nov, delayed to 2Q 2010!

If 'very much go forward' is a 6 months delay, imagine what a delay actually would be!

SP had already drifted from $1.20 to $1.14 in one week before the announcement.

So, the selling continues.

[Balance]

http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10611222

Funny but the legions of PRC investors have gone into hiding? Normally this potential extension of Liberty's bond facility will be plastered all over this thread?

Time to buy.

[dsurf]

Very true good buying at $1 - out at $1.20 on first shipment of coal Apr / May (only joking - lets say Mar)

[Snow Leopard]

Very true good buying at $1 - out at $1.20 on first shipment of coal Apr / May (only joking - lets say Mar)

Which Year?

[Balance]

Which Year?

That is cruel ... and clever!

[Baddarcy]

Am i correct in assuming that if Liberty Harbor has just done a review using their inhouse expert of PRC and the existing production target is supposed to start ticking on 30th November, there should be an announcement of an extension by Liberty Harbor shortly?

Let's be honest LH would have to be brain dead to pull up stumps, they effectively have $30 million of stock options at $1.08 that they are getting paid interest on at 14 point something %. They must have the best deal on the planet. They surely would only walk away if the mine was well and truely poked.

But to get to the point, when the announcement comes in theory it should be shortly and it should have a positive imact on the share price as it removes an element of uncertainty?

Thoughts?

[Anna Naum]

Am i correct in assuming that if Liberty Harbor has just done a review using their inhouse expert of PRC and the existing production target is supposed to start ticking on 30th November, there should be an announcement of an extension by Liberty Harbor shortly?

Let's be honest LH would have to be brain dead to pull up stumps, they effectively have $30 million of stock options at $1.08 that they are getting paid interest on at 14 point something %. They must have the best deal on the planet. They surely would only walk away if the mine was well and truely poked.

But to get to the point, when the announcement comes in theory it should be shortly and it should have a positive imact on the share price as it removes an element of uncertainty?

Thoughts?

As PRC has broken its covenants with regard to the loan, LH would be in the position of asking for higher interest rates and/or further security. Just because it is in a good position does not mean it will not seek more!

As to the SP the real gain (or otherwise) that is all about getting the black stuff out of the ground.

[dsurf]

Am i correct in assuming that if Liberty Harbor has just done a review using their inhouse expert of PRC and the existing production target is supposed to start ticking on 30th November, there should be an announcement of an extension by Liberty Harbor shortly?

Let's be honest LH would have to be brain dead to pull up stumps, they effectively have $30 million of stock options at $1.08 that they are getting paid interest on at 14 point something %. They must have the best deal on the planet. They surely would only walk away if the mine was well and truely poked.

But to get to the point, when the announcement comes in theory it should be shortly and it should have a positive imact on the share price as it removes an element of uncertainty?

Thoughts?

Everyone is nervous about this and it is reflecting in the SP. The lack of detail apart from vaguely mentioning "to be negotiated" is unsettling. It is not really in LH's interest to have a falling SP so I assume a "confidential" deal has already been done and an interest rate of 20% or similarly exorbitant will eventually be revealed in the FY accouints 2mths after year end as an "extraordinary" or "abnormal" payment that will measure millions. The mine should (please please please) be truly operational by then and earning large revenues so the mere matter of a few millions will be lost in the noise.

[Anna Naum]

Everyone is nervous about this and it is reflecting in the SP. The lack of detail apart from vaguely mentioning "to be negotiated" is unsettling. It is not really in LH's interest to have a falling SP so I assume a "confidential" deal has already been done and an interest rate of 20% or similarly exorbitant will eventually be revealed in the FY accouints 2mths after year end as an "extraordinary" or "abnormal" payment that will measure millions. The mine should (please please please) be truly operational by then and earning large revenues so the mere matter of a few millions will be lost in the noise.

There is still the real issue of the $20m, without it I can not see how they can get to the level of volume they require to get the LH covenants lifted....therefore is there not a bit of a catch 22 situation. To meet volumes they need money, to get money they need volume.

They need capital.

[Dr_Who]

PRC should now remove uncertainty from the market by raising enough capital to cover all debt and have cash to see them through to mid next year.

Management should be more transparent and heads should roll.

This is the only way I can see PRC gaining back investor confidence... and of cos get those dam coal out of the ground. But till then, management have just given us alot of BS.

[geezy]

maybe it would be wise to invest only when they are producing as they can only get better!

[Anna Naum]

maybe it would be wise to invest only when they are producing as they can only get better!

True, although I doubt if Goldman Sachs wants to own a coal mine in NZ, after all they do not like to get dirty, they all wear suits. So they will get an extra pound of flesh for what they are owed. The real issue is the $20m that PRC needs. In the end it will either be a capital raising from existing shareholders or they will sell a stake in the company in return for coal (what else do they have to offer).

If it is a rights issue then in theory current shareholders are not dilluted (assuming it is a pro rata entitlement) or the company places a stake in return for loot. Either way it has to be good for existing shareholders. The risk is that they are silly and do a private placement at a discount to the market which most shareholders miss out on....however even if that happens the SP should go better.

The one big downside as I see it is if they come out and delay production delivery and increase how much loot they need.

[Hoop]

maybe it would be wise to invest only when they are producing as they can only get better!

Geezy your logic is wrong.
When they are up and running at maximum capacity things can't get better and investor worries creep in.
In actual fact Geezy in theory, planning to enter when they are producing, the risk could be greater than the reward as the share price could be nearing a premium.

Its only wise to invest when that stock triggers buy signals and be quick about it as others will also watching and waiting for those same signs.

Being conservative and playing ultra safe you sacrifice the reward with the lower risk you take. The more conservative investors are happy with this risk/reward trade off as their decisions aren't affected by one of the Investors deadly sins... the Greed factor.

Thinking and planning ahead and say you will enter only after they are producing the black stuff at their desired volume rate..you may well find that you have been left behind. The more risk takers will be well ahead of you...and pushed up the price in the process.

Then again it is a high risk venture..the share price may continue to go down..who knows

Disc have PRC

[Placebo]

As a holder I have been given an inkling of how the English rugby administrators feel. You've got something you know should work right, and has great potential. You've put your faith in who you think is the top bloke.... now it's a wait.. and a wait... and a wait... for the results to come... What to do now..? Stick with the decision you've made, or take an even bigger risk and jump ship?

It's possible Martin Johnson will deliver for English rugby before PRC delivers for its shareholders! Doesn't bear thinking about really.

[neopoleII]

prc will deliver sometime, and when that sometime happens prc will be a great company to invest in for dividends.
the question is when to get in......... im thinking that i might enter into prc soon, they are learning the new machinary and learning the topography, and the share price is low.
this has so much potential and the traders and speccies have abanded the ship.

[Xerof]

take a look at a PRC chart - there is nothing - nothing - that says "buy me"

I'll buy back in when the chart is compelling

[Glendoonie]

take a look at a PRC chart - there is nothing - nothing - that says "buy me"
Last PRC chart from Phaedrus was posted on 6 August #3818. Phaedrus, are you on holiday?
G

[Balance]

prc will deliver sometime, and when that sometime happens prc will be a great company to invest in for dividends.
the question is when to get in......... im thinking that i might enter into prc soon, they are learning the new machinary and learning the topography, and the share price is low.
this has so much potential and the traders and speccies have abanded the ship.

Produce PRC will - question of when and how much.

Pay dividends? Sure but PRC will argue they need to maintain a high cash reserve for future opportunities as the mine runs down. This is a mining company after all.

So high yielding? Maybe not.

Great company to invest in for dividends? Depends on the sp you get in at.

Meanwhile, deafening silence from company on when they expect to be able to hit running rate of 1m tonnes a year.

[tricha]

. The time to buy PRC was when it broke above the 10 month trendline and the OBV began to rise. (Dark green arrows). The next buying opportunity was when PRC broke above its Symmetrical Triangle and the OBV resumed rising again. (Light green arrows). Would now be a good time to buy? Yes, but the risk is of course somewhat higher now.

The breakout you would have been watching for here was from the Symmetrical Triangle formation. This happened over a week ago. We should not be surprised that it was an upward breakout because the odds were 64:36 in favour of this. This was a slightly unusual example of a symmetrical triangle in that it ran all the way to the end, right to the apex of the triangle. Most of these formations break out around 80% of the way to the apex.

http://h1.ripway.com/78963/PRC86.gif

PRC has been a very disappointing share for "buy and hold" investors. For "active" investors (if you call 1 trade a year active!) returns have been excellent.

Hmm, fundamentals man, here u r trying to trade a dog, try Beach, 150 million cash, no debt and heaps of oil.
Stick to the fundamentals, buy an under valued company :rolleyes:

Disclosure - never held PRC and never will, but I have been for a job interview there and I have a friend that built the processing plant :eek:

[root]

Hmm, fundamentals man, here u r trying to trade a dog, try Beach, 150 million cash, no debt and heaps of oil.
Stick to the fundamentals, buy an under valued company :rolleyes:

Disclosure - never held PRC and never will, but I have been for a job interview there and I have a friend that built the processing plant :eek:

You mean Beach Energy.

[Phaedrus]

Take a look at a PRC chart - there is nothing - nothing - that says "buy me"I'll drink to that. The steadily falling OBV alone should be enough to deter any technically savvy investor.


Stick to the fundamentals, buy an under valued company Yeah right! Just like the mug-punters that bought a down-trending PRC at $1.90 when ABN Amro gave it a fundamental valuation of more than double that. They stuck to the fundamentals!!!!!

http://i602.photobucket.com/albums/tt102/PhaedrusPB/PRC1129.gif

[Glendoonie]

...The steadily falling OBV alone should be enough to deter any technically savvy investor.
Never claimed I was 'technically savvy' (phew!)

[patrick]

Is there anyone who was at the Meeting able to comment on whether any indication was given about production levels over the next few months?
Thanks

[Placebo]

. They stuck to the fundamentals!!!!!



Unfortunateley, they were also talking through their fundamentals.

Sentiment, optimism and hope are impossible to quantify, but nevertheless play heavily on a share price (as do their opposites). As PRC is now showing us - with the 20/20 benefit of hindsight...

[forest]

Is there anyone who was at the Meeting able to comment on whether any indication was given about production levels over the next few months?
Thanks

Gorden Ward Chief Executive said there will be an shipment of between 20 and 30 thousand ton in the first quarter of 2010.

I do not know if this is an indication of production levels but can not think of anything more concrete that was mentioned at the meeting.

[Dr_Who]

Gorden Ward Chief Executive said there will be an shipment of between 20 and 30 thousand ton in the first quarter of 2010.

I do not know if this is an indication of production levels but can not think of anything more concrete that was mentioned at the meeting.

I think they promise something similar 2 years ago. The stuff is still in the ground... LOL What a laugh!

[geezy]

They did say that they have a stockpile of 18 thousand tonnes so 20k should be much of an issue to be delivered by then :)

[Nitaa]

Yeah right! Just like the mug-punters that bought a down-trending PRC at $1.90 when ABN Amro gave it a fundamental valuation of more than double that. They stuck to the fundamentals!!!!!

Phaedrus. Dont be fooled by what some so called experts perceive as good value stocks based on Fundamentals. I consider myself to buy stocks on fundamentals as TA to me is like tossing a coin. But thats just me.

The problem with a stock like PRC is there are too many risks associated it. We fairly well know the upside potential but the down side risks are too much of a variable. Ive never bought this stock for this reason, whether its been below $1 or above $2 as i dont like gambling that much.

[Phaedrus]

So we can agree that fundamental "valuations" are alarmingly subjective?

[shawsie]

Phaedrus take your tongue out of cheek.

With no charts as evidence it has seemed to me that PRC has some kind of round number (100) support/resistance thing going on, and now a trade at 99 I see, are there any examples of same and/or literature to support.

ie the fundies are so vague the mkt moves to the nearest 20cents etc.

and if so, is the elevator about to decend to the next floor?

[Baddarcy]

Gorden Ward Chief Executive said there will be an shipment of between 20 and 30 thousand ton in the first quarter of 2010.

I do not know if this is an indication of production levels but can not think of anything more concrete that was mentioned at the meeting.

I've looked at the stockpiles they have been announcing in thier press releases as follows:

10,000 in September
14,000 in October
17,000 in November

So you can safely assume they are pulling the coal out at 1,000 tonnes per week at the moment. So they should hit 20,000 by the end of next week, so at the rate i would expect the first shipment to leave in January or the first half of February.

[Phaedrus]

It has seemed to me that PRC has some kind of round number (100) support/resistance thing going onI don't see that, Shawsie. There has been a loose band of support/resistance between 96 and 102, I guess.


Is the elevator about to descend to the next floor?PRC is in a trend channel. The downtrend has been proceeding steadily, rather than staying at one level for a while, dropping to the next and pausing before falling again. PRC's price action would be more analogous to a ramp than an elevator but I suppose the message is the same however you view it - Avoid.

http://i602.photobucket.com/albums/tt102/PhaedrusPB/PRC121.gif

[Placebo]

Urrghh. Horrible, horrible picture. Not what I need to greet me in the morning. It's nearly as bad as that I time I commissioned a family portrait from Salvador Dali. The wife hasn't spoken to me since.

Please, no more charts until PRC shifts its first shipment and gets outta that red zone!

[Hoop]

Urrghh. Horrible, horrible picture. Not what I need to greet me in the morning. It's nearly as bad as that I time I commissioned a family portrait from Salvador Dali. The wife hasn't spoken to me since.

Please, no more charts until PRC shifts its first shipment and gets outta that red zone!

Yes ugly..but notice there is a S&R line running on the shoulders at 102.

[Baddarcy]

Well PRC should be hitting 20,000 this coming week.

Presumably PRC know the exact date that the shipment is due to go, as i am guessing they would need to make bookings for the trains to get the coal to Lyttleton and the Indian customers would have to book a ship to load it on to at leat a few weeks in advance.

Going on what they said the initial shipment was going to be between 20,000 - 30,000 tonnes and be in Jan to March 2010 date range and they should by the end of next week have 20,000 then the first shipment is going to be closer to the 30,000 end of the range and most likely in January not March.

Potentially January, maybe even late December could be a positive month for the stock price with a few pieces of good news due. The first shipment should be going in January, they should be all the way through the Graben by mid January which will then increase thier production rate from the current 1,000 per week. The Liberty Harbor money thing should be sorted out by then too.

[Placebo]

That's the most optimistic post I've seen on this thread in a long time. I hope you're right!

[dsurf]

Why not be positive - most of what could go wrong already has!! Rock falls, equipment failure, cost overruns, delays, fund raising !!!

But that is behind us - PRC SP will do well in 2010. It will be a mining stock that delivers coal!!! This will cause the current (justified) negativity to disapate. After the methane subsides I am (conservatively) picking over $1.50 by end 2010 - 50% gain on present. Any other NZX shares (barring oilers who find oil) other this sort of return that posters can think of.

Discl - very frustrated holder who does see light at the end of the tunnel

[Wilkins_Micawber]

CONTINUOUS MINER BACK ON TRACK

Mining operations at Pike River Coal (PRC) have received a boost with one of
the company's continuous miners back at the mine face following completion of
a software upgrade to the new traction system, says Pike River chief
executive Gordon Ward.

"The software upgrade was the final step in getting this piece of machinery
100% operational," says Mr Ward.

"Having this upgrade completed means the electric drives on the continuous
miner are now back to being fully functional and complementary with the
crawler traction systems they run".

Mr Ward says the continuous miners - the machines which actually cut the coal
to create the mine roadways - are an essential part of Pike River's mining
operation so today's news is a welcome development.

"We have experienced a few issues with the continuous miners over past
months, the major one being with the tracks that were fixed at the German
manufacturer's expense."

"Now the software upgrade is completed, we expect to see these machines
operate with far greater reliability and enhanced performance."

Mr Ward says good progress is being made at three drill and blast faces and
the company is on track to getting through the rock graben (a faulted area)
by late December/early January 2010.
"Once we get through the graben we are back into coal," says Mr Ward.

"The graben is only 100 metres in extent so once we are through that we'll be
driving towards the first hydro panels and on our way to hydro-mining in the
April - June 2010 quarter."

[pietrade]

[QUOTE=
Discl - very frustrated holder who does see light at the end of the tunnel[/QUOTE]


--- just as long as Murphys' Law doesn't prevail - ie. "the light at the end of the tunnel means there's a train coming"

[Billy Boy]

--- just as long as Murphys' Law doesn't prevail - ie. "the light at the end of the tunnel means there's a train coming"

Or it could mean the train has passed !!! ?
BB:)

[777]

What, a train full of coal?

[beacon]

Or of broken mining equipment and useless rock pieces

[Baddarcy]

Found this article on agmetalminer.com, would be good for PRC if BHP is successful. Given they were with Thermal Coal and Iron Ore already there is no reason to belive they won't be.

While any short term share price rises will be tied to the getting through the Graben, making the first shipment and starting hydro mining. Long term the share price will be controlled by NZD v USD and the Contract Price/ Spot price so this attempt by BHP can only be good news?

Anyway enough cheerleading here is the article :-)
---------------------------------------------------------

BHP Moves Coking Coal to Spot Pricing
December 7th, 2009 · 1 Comment
BHP, the world’s largest supplier of coking coal used in steel making is pushing for annual contract pricing to be based on spot prices rather than the traditional annual fixed price contracts. If successful, costs for steel makers are likely to rise as spot prices are predicted to be higher in 2010/11 than now.

BHP is successfully moving iron ore pricing to the spot market and although it took some five years has also migrated thermal coal, used in power stations, onto spot pricing so the tide of history is running against steel producers clinging to the annual fixed price mechanism.

According to an FT article, coking coal spot prices have rallied in the past six months as China becomes a large importer owing to strong local demand and domestic mine closures. Traders said that prices had surged to about $175 per metric ton, the highest so far this year and more than 30% above the level at which annual contracts were settled for 2009-10. Moving to contracts linked to spot prices would enable BHP to obtain higher prices for its coking coal the firm believes as prices could reach $200 per metric ton in the first quarter of 2010. Prices reached a record of $300 per metric ton in 2008.

Demand from China has remained strong despite the industry reportedly running at only 72% capacity utilization and the Ministry of Industry and Information Technology’s announcement last August of a ban on all new capacity projects for the next three years. Since then, 32 new expansion projects have been announced at 27 different steel mills. Clearly economic priorities take precedence over government directives. In fact the scale of excess capacity in China is positively scary, at the end of 2008, China’s steel capacity was 660m tons against demand of 470m tons. This difference is much the same as the European Union’s total output. Yet, there are currently 58m tons of new capacity under construction in China further exacerbating the problem.

With demand running at these levels BHP is playing with a strong hand even if other Asian buyers are still struggling. Nevertheless it could be a year or two before the producer manages to move the whole market over to spot but as it does, providers of OTC coking coal contracts are likely to be the other major beneficiary to BHP.

–Stuart Burns

[Placebo]

CONTINUOUS MINER BACK ON TRACK

Mining operations at Pike River Coal (PRC) have received a boost with one of
the company's continuous miners back at the mine face following completion of
a software upgrade to the new traction system, says Pike River chief
executive Gordon Ward.

"The software upgrade was the final step in getting this piece of machinery
100% operational," says Mr Ward.

"Having this upgrade completed means the electric drives on the continuous
miner are now back to being fully functional and complementary with the
crawler traction systems they run".

Mr Ward says the continuous miners - the machines which actually cut the coal
to create the mine roadways - are an essential part of Pike River's mining
operation so today's news is a welcome development.

"We have experienced a few issues with the continuous miners over past
months, the major one being with the tracks that were fixed at the German
manufacturer's expense."

"Now the software upgrade is completed, we expect to see these machines
operate with far greater reliability and enhanced performance."

Mr Ward says good progress is being made at three drill and blast faces and
the company is on track to getting through the rock graben (a faulted area)
by late December/early January 2010.
"Once we get through the graben we are back into coal," says Mr Ward.

"The graben is only 100 metres in extent so once we are through that we'll be
driving towards the first hydro panels and on our way to hydro-mining in the
April - June 2010 quarter."

I was wondering what this fairly pointless media release was about, then there it was, the sting in the tail. Isn't hydro mining in the April-June 10 quarter Yet Another Delay? (YAD). Weren't they only a few weeks ago predicting full production in the first quarter 2010?

YAD should be Pike River's new stock exchange code.

[Bilo]

Isn't hydro mining in the April-June 10 quarter ? Weren't they only a few weeks ago predicting full production in the first quarter 2010?

The quarterly activities report on page three headlined First Hydro-Mining IN APRIL-JUNE QUARTER.

If there is a delay it is to how the board resolve to bolster cash to meet operational outgoings for the first half of 2010.

[Dr_Who]

The price at these level tells me there is a potential for a cap raising soon?

Whatever it is, the market have seem to lost confidence they can meet deadline.

[Bilo]

The price at these level tells me there is a potential for a cap raising soon?

Whatever it is, the market have seem to lost confidence they can meet deadline.
During their presentation road show they left open the possibility of a capital raising. GW has never liked banks, it may be mutual, but PRC could increase their gearing (IMO) when they are producing - which comes first?
The Liberty Harbour deal turned out to be worse for shareholders than any bank debt would have been.

[Baddarcy]

During their presentation road show they left open the possibility of a capital raising. GW has never liked banks, it may be mutual, but PRC could increase their gearing (IMO) when they are producing - which comes first?
The Liberty Harbour deal turned out to be worse for shareholders than any bank debt would have been.

The two outstanding issues that are probably holding back the share price a bit is the renegotiation of the Liberty Harbor loan of approx $USD30m and the $NZD20m they are going to need from Feb 2010. I don't expect to hear about the $20m until late Jan 2010 as PRC will want to have some good news to release before that. The good news will be getting through the graben and the first shipment being sent, both of which i expect to hear about in early Jan.

Liberty Harbour announcement could be any day as they have been negotiating for a while now with them.

[Balance]

Sp drifting lower and lower - contrast that to the Australian coal miners like MCC.

Something is about to happen.

Based upon sp performances in the past, expect a negative announcement shortly.

Suggestions :

1. Liberty deciding to call in their loans after negotiations break down on the interest rate Liberty wants to charge, and the terms of conditions around conversion to shares.

2. Another unexpected mining problem.

3. Rights issue.

[Doyle]

Or it could just be that we haven't heard any news for a while, and going on past peformance, no news means bad news so we are all pricing in non-existant bad news.

Discl: Never been a holder but always followed with a view to buying.

[Balance]

Or it could just be that we haven't heard any news for a while, and going on past peformance, no news means bad news so we are all pricing in non-existant bad news.

Discl: Never been a holder but always followed with a view to buying.

Put it this way - the possibility of good news being announced is virtually non-existent.

Can you hear the sound of Liberty insisting on their tonne of coal in the background?

[patrick]

Negotiating with Liberty?
Implies some strength on both sides.
What do you need from us ?would be more accurate.

[mouse]

I went to the Annual Meeting at the mine this year and the presentation in Christchurch. First, the export shipment of 20,000 tons of coal in January or so. This is actually a years total production. How much it has cost to mine I have no idea, but it was heaps. Last year we actually parked our cars under the coal gantries, there was so little coal mined.
Looking at the mine I was struck by how reliant upon their production system the output is. A problem with the pipe system which sends coal from the mine to the process plant would quickly lead to a bottle neck and stop production of coal.
etc., etc.
Using trucks to move coal from the mine to the processing plant is not feasable since the mine entrance is a bit congested. Hopefully the use of trucks will not be required.
The mining equipment works in a very harsh environment. It has to have a lot of 'preventative maintenance'. During that time the piece of equipment is down, not working. Major work requires the equipment taken out of the mine which, from memory, takes a day.
To export one million tons of coal a year will require 2 trains a day of 48 wagons. Some requirement. I think that realistically only 700,000 tons a year will be mined, but this is my ignorant 'guesstimate', what are other views please?
The whole operation requires many, many, different stages to get the coal onto the ships.
Training of miners in the use of the hydro mining system will take from April to June. Full production will start then.
Note these comments are from memory.

[Placebo]

Thanks Mouse. Useful!

[Scuffer]

Well done mouse my thoughts exactly, not sure LPC could handle the amount of coal that Pike want to put out 700,000 is a more realistic figure if they can get that amount out in a year, like you said the slurry system is a preventative maintenance nightmare especially with a coal which is sticky, blockages will be frequent and time consuming.

[Rabbi]

Yes, one million tonnes a year was never feasible, according to the old miners.
" They will be lucky if they get half that, " is the normal response from men with experience."

Another quote from an expert was "There is not as much coal as they think there is. "

On the positive side, they have a ready market as the coal is top grade hard coking coal, and the price-at around $160.00 US tonne- is far in excess of the $90 in the prospectus.

All they have to do is get the coal out of the mine in "commercial quantities."
We all wait in hope.
:confused:

[Balance]

Yes, one million tonnes a year was never feasible, according to the old miners.
" They will be lucky if they get half that, " is the normal response from men with experience."

Another quote from an expert was "There is not as much coal as they think there is. "

On the positive side, they have a ready market as the coal is top grade hard coking coal, and the price-at around $160.00 US tonne- is far in excess of the $90 in the prospectus.

All they have to do is get the coal out of the mine in "commercial quantities."
We all wait in hope.
:confused:

Keep waiting.

This is one company which cannot get coal out of the ground but will try and talk up its prospects about the other seam. What does that tell you about its real prospects?

Catch the first fish first!

[GTM 3442]

good point the main thing about PRC is that T/O speculation isnt needed to make this share a star all it needs to do is stick to its timtable, inform the market about progress and start producing coal :D

Boysy, that post from 21/07/2007 seems somehow relevant even today. Well said.

Where's the coal ?

PRC should be a nice little earner, but not quite yet. . . . .

[Balance]

Without being smug I am pleased I am not currently a holder... I well remember a conversation I had with a cpl of retired mine managers at the Blackball Workingmens Club a year or so back.. they advised caution, spoke of fractured rock, problems with the fault line...etc etc.. I posted about that,... on this thread or the NZO thread can not recall which.... from memory it did'nt result in universal acclaim from other posters....

My point is,.... this hold up may get a lot lot worse... this may drag the S/P way down..
Some may label me Cassandra instead of Croesus....fair enough....if you have margin traded PRC or its parent.... have a wee thought about your personal exposure...

cheers C.

August 2008 - http://www.sharetrader.co.nz/showthread.php?t=4603&page=180

Croesus helpfully and in a timely manner, warned posters. Sp was $1.70 and heading down.

The abuse he received from some posters shows the 'head-in-the-sand' approach some take.

[croesus]

Cheers Balance.....had forgotten posting that...unfortunately what I said has come to pass..now thru inept management.. we are faced with a hefty rights issue ..or placement

Bit harsh.. no I do not think so... these are the clowns that could tell us how many stoats have been trapped.. but not that they had .. A/ suffered a rock fall, or
B/ how much if any coal they had dug...
Whilst most of the hard yards are done.....I would still keep my wallet in my back pocket..shortly they will be beseeching us for funds ( my pick.. depending on how much Liberty screw us).

If that happens .. there will be a rush for the exit.. and then that will be the time to buy.. 60 to 70c is my pick.

Croesus

[Balance]

Cheers Balance.....had forgotten posting that...unfortunately what I said has come to pass..now thru inept management.. we are faced with a hefty rights issue ..or placement

Bit harsh.. no I do not think so... these are the clowns that could tell us how many stoats have been trapped.. but not that they had .. A/ suffered a rock fall, or
B/ how much if any coal they had dug...
Whilst most of the hard yards are done.....I would still keep my wallet in my back pocket..shortly they will be beseeching us for funds ( my pick.. depending on how much Liberty screw us).

If that happens .. there will be a rush for the exit.. and then that will be the time to buy.. 60 to 70c is my pick.

Croesus

Agree with you that no news on Liberty is bad news.

Dr Who is right when he wrote that PRC must come clean, tell ALL investors and shareholders exactly where they are at, how much money they really need to get the coal out of the ground and not allow selected investors to cherry pick their entry prices.

The fact that 'negotiations' are still going on suggests Liberty will extract their pound of flesh. If they call their money back, the market will be spooked - something must be horribly wrong for them to want to pull out. PRC will have to have a very heavily discounted rights issue because no-one will be brave enough to underwrite.

Given that situation, Liberty has the upper hand which they are going to exploit to the hilt. Interest rate of 20% and conversion to shares at 25% discount to sp?

[dsurf]

Whilst most of the hard yards are done.....I would still keep my wallet in my back pocket..shortly they will be beseeching us for funds ( my pick.. depending on how much Liberty screw us).

If that happens .. there will be a rush for the exit.. and then that will be the time to buy.. 60 to 70c is my pick.

Croesus

Bank funding or NZO protecting thier investment & providing a short term working capital loan may prevent a rights issue or "give-away" funding yet. This would be a better outcome for long suffering shareholders IMO.

I am a NZO shareholder also and having suffered since the original PRC IPO announcement (2002?) think another 6 to 12 months wait would be worth it given the 30%? holding.

[dsurf]

Agree with you that no news on Liberty is bad news.

Dr Who is right when he wrote that PRC must come clean, tell ALL investors and shareholders exactly where they are at, how much money they really need to get the coal out of the ground and not allow selected investors to cherry pick their entry prices.

The fact that 'negotiations' are still going on suggests Liberty will extract their pound of flesh. If they call their money back, the market will be spooked - something must be horribly wrong for them to want to pull out. PRC will have to have a very heavily discounted rights issue because no-one will be brave enough to underwrite.

Given that situation, Liberty has the upper hand which they are going to exploit to the hilt. Interest rate of 20% and conversion to shares at 25% discount to sp?

Liberty are already getting thier pound of flesh, but the fact remains that Liberty get the most reward if the SP puts the options well in the money, so do they really want a very low SP? I think not so why would they announce a deal that would hurt the SP if they can hide behind confidentiality agreements on a "non-signignificant in terms of balance sheet transaction".

[Balance]

Watch out - someone just put a bid to buy PRC at $1.00.

Oh wow . all 340 shares to buy at $1.00.

Blatant attempt to suck the punters in to sell to.

[mouse]

I am a Believer. I think Pike are first rate. I think they should manage to mine and ship 700,000 tons of coal a year. I have great confidence in Peter Whittall, Mine Manager, and Gordon Ward, Chief Exec. There are problems of course, but the bottleneck problems may only exist up to the point where the coal is trucked from the mine to Ikamatua. There is space at the flat processing point, about 12kms from the point where the coal is actually mined, for storage to provide a stockpile. Plus another stockpile at Ikamatua.

After the 90cent rights issue in January, 2008, there were about 337 million shares and options on issue. We then had the 70cent rights issue in March 2009 which now gives about 350 million shares, plus options and plus convertible bonds. There is now a shortfall of $20 million so there is another issue of shares probable in January or February 2010.

At this point, it is only one mine! More shares does not mean more dividend cash, quite the reverse. We have 17 million tons of coal which gives us a mine life of about 25 years. Plus another 17 million tons when we accept that mining should be continued to provide well paid work on The Coast. Once the mine is exhausted there is no coal and our shares, in the Pike River Mine, are worthless. Other mines may of course have been started by Pike.

So, what is the dividend to be? It should start to be paid around October 2011. Providing that everything continues to go to plan. We could get a 10cent dividend. Ten cents per share. But here we have a problem, the Rights expire March 2011. Why are they selling at 20 cents? It seems madness to me. Maybe they are only worth 10 cents each.

What are the shares now worth is the question. Steady state production seems to be indicated for around August next year. Providing no further difficulties.

I was talking to Peter Whittell. He told me that the graben is due to be got through shortly. They already have a small shaft through it and know there is 400 metres of coal from a probe that has been inserted through the graben and into the coal seam on the other side.

Next, Google NZ, West Coast Mining History. Hopefully you will find the sorry state of mine closures. Go to Blackball and look at the abandoned mine there. Abandoned mines are all over the area. Why did they close? Its actually quite amusing. Providing you did not invest in them.

I am a Believer. But how much are my shares worth?
Disclosure. I sold all except 500 of my Pike shares and now only have those plus 2,600 options. But what are the shares worth?

[friedegg]

did peter know you only had 500 shares?

[mouse]

I of course kept quiet about how many shares I had in Pike. Actually I managed to make about $3,000 on selling my few shares, so the 500 shares I still own do not owe me anything. The problem is, what price to buy back in at? Also what price will the new rights be.
One suggestion made was to let all rights holders buy new shares at 80 cents in exchange for their options. Thus trying to stop this ridiculous watering down, dilution, of our shares.
Even my 500 shares have been diluted!
Also interesting is the fact that at The Blackball Hilton meeting the evening before the Pike AGM about half of those present had sold their shares, only having options left.

[Balance]

Bank funding or NZO protecting thier investment & providing a short term working capital loan may prevent a rights issue or "give-away" funding yet. This would be a better outcome for long suffering shareholders IMO.

I am a NZO shareholder also and having suffered since the original PRC IPO announcement (2002?) think another 6 to 12 months wait would be worth it given the 30%? holding.

No chance of bank funding - zippo. The banks will fund working capital fully secured over everything once the mine is up and running - but not before.

[Balance]

Liberty are already getting thier pound of flesh, but the fact remains that Liberty get the most reward if the SP puts the options well in the money, so do they really want a very low SP? I think not so why would they announce a deal that would hurt the SP if they can hide behind confidentiality agreements on a "non-signignificant in terms of balance sheet transaction".

A low sp is good for Liberty - Liberty will be negotiating to get their options repriced at a low level.

[Hoop]

Mouse quote..."...But here we have a problem, the Rights expire March 2011. Why are they selling at 20 cents? It seems madness to me. Maybe they are only worth 10 cents each...."

Mouse.... you have bought up a interesting point..PRCOA have been off my radar screen since I sold them some time ago but it seems looking at the latest price of 20.5c and some quick analysis shows some interesting signs.

When I sold my PRCOA back in early July 2009 for an average of 26c the options were priced with PRC having a volatility of about 45% which was considered to be on the low side...Yesterdays PRCOA price of 20.5 reflects a volatility of 62% which is nearer to where it should be (maybe a little too high %volatility?) and seem to be now fully priced. Even though the price is in a downtrend it bullishly priced, if that make sense :)

So it seems the option traders now assume PRC stock to be more volatile than in July....interesting.

Now if the option traders are correct we could see bigger swings in PRC prices..to date these swings are not evident as PRC has been stuck in this 97-121c trading range since June.

This recent weakness of low volume plus this recent downtrend to test the trading range baseline (strong support level) of 97c is scary knowing that the market is expecting higher volatility in this stock....

However volatility works two ways.. up and well as down...At the moment the market feeling is down and TAwise a stock to avoid until positive signs start to emerge. As Mouse points out, the market is currently asking this question..fundamentally what is the true price of PRC? ...a scary time for PRC holders

Must remind myself to an keep eye on PRCOA for now onwards.

Disc: have some PRC:o...at an average just over a $1

[Balance]

An announcement must be due any day now. Sp down again.

[PhaedrusFollower]

Hoop - thanks for that clear and concise summary.

[Silverlight]

I just calculated the price of the options versus the head share at 97 cents.

I used 494 days to expiration.

The volatility I had to use was 47.89% to achieve a theoretcical price of 20.6 cents.

[the machine]

extract from my stockbrokers report this morning:

However Argonaut believes the risks are outweighed by the unparalleled leverage GNM offers to bullish hard coking coal fundamentals. Argonaut expects the JFY09 hard coking coal benchmark price of US$129/t to rise to US$180/t for the next 3 years. It was only 18 months ago that prices reached US$300/t.

M

[Baddarcy]

extract from my stockbrokers report this morning:

However Argonaut believes the risks are outweighed by the unparalleled leverage GNM offers to bullish hard coking coal fundamentals. Argonaut expects the JFY09 hard coking coal benchmark price of US$129/t to rise to US$180/t for the next 3 years. It was only 18 months ago that prices reached US$300/t.

M

There is no doubt about the potential of the PRC stock. We see that every time there is a little bit of good news the stock jumps up to 120 but then the uncertainty sets in again and it dribbles back on low volumes to between 95 and 100 which is what it is doing right now.

In the short term i expect a repeat of the bounce to 120 when we hear about the graben being defeated and/or Liberty Harbor issue being sorted out. But the big jump in price isnb't going to happen until 60,000 tonnes a month is rolling out of the hole in ground. This is why i own PRCOA and not PRC.

The issues on the table in the next few months and my expected sorting out date are in my opinion as follows:

1) Graben (Late December)
2) Liberty Harbor (January)
3) First shipment leaving (January)
4) $20m required in Feb 2010 (February)
5) Hydro mining starting (March)
6) first full 60,000 shipment (April - May)

[Balance]

There is no doubt about the potential of the PRC stock. We see that every time there is a little bit of good news the stock jumps up to 120 but then the uncertainty sets in again and it dribbles back on low volumes to between 95 and 100 which is what it is doing right now.

In the short term i expect a repeat of the bounce to 120 when we hear about the graben being defeated and/or Liberty Harbor issue being sorted out. But the big jump in price isnb't going to happen until 60,000 tonnes a month is rolling out of the hole in ground. This is why i own PRCOA and not PRC.

The issues on the table in the next few months and my expected sorting out date are in my opinion as follows:

1) Graben (Late December)
2) Liberty Harbor (January)
3) First shipment leaving (January)
4) $20m required in Feb 2010 (February)
5) Hydro mining starting (March)
6) first full 60,000 shipment (April - May)

And notice that every time the sp spikes, the smart money sells into the spikes?

[Hoop]

I just calculated the price of the options versus the head share at 97 cents.

I used 494 days to expiration.

The volatility I had to use was 47.89% to achieve a theoretcical price of 20.6 cents.


:confused::confused: What method & variables did you use Silverlight... and as a "first poster" to ST ....welcome.


I used the following

Black-Scholes

Exercise price 125c
Expiry date 24 Apr 2011
Current security price 97c
Interest rate 3%
Dividend rate 0%
Security Volatility 62.5% = call 20.5021c put 43.5383c

Using the Binomial formula.. nearly the same except the put price is 1 cent higher.

I would like know who's figure is correct now..I hope it not my software program at fault.

[Silverlight]

Your software sounds far superior to my excel spreadsheet :p

I was using black shcoles.

Using your 3% interest (I orginally had 2.5%), at 64% volatlility I can get $0.2053.

I am working backwards here though, inputting price rather than trying to calculate what the theoretical price should be.

[Balance]

:confused::confused: What method & variables did you use Silverlight... and as a "first poster" to ST ....welcome.


I used the following

Black-Scholes

Exercise price 125c
Expiry date 24 Apr 2011
Current security price 97c
Interest rate 3%
Dividend rate 0%
Security Volatility 62.5% = call 20.5021c put 43.5383c

Using the Binomial formula.. nearly the same except the put price is 1 cent higher.

I would like know who's figure is correct now..I hope it not my software program at fault.

BS only works in very liquid markets. PRC is not liquid.

[root]

Fundamentals aside, the 0.97 support line is being sorely tested today.

[geezy]

An announcement must be due any day now. Sp down again.

down coz i was selling balance :)

[the machine]

There is no doubt about the potential of the PRC stock. We see that every time there is a little bit of good news the stock jumps up to 120 but then the uncertainty sets in again and it dribbles back on low volumes to between 95 and 100 which is what it is doing right now.

In the short term i expect a repeat of the bounce to 120 when we hear about the graben being defeated and/or Liberty Harbor issue being sorted out. But the big jump in price isnb't going to happen until 60,000 tonnes a month is rolling out of the hole in ground. This is why i own PRCOA and not PRC.

The issues on the table in the next few months and my expected sorting out date are in my opinion as follows:

1) Graben (Late December)
2) Liberty Harbor (January)
3) First shipment leaving (January)
4) $20m required in Feb 2010 (February)
5) Hydro mining starting (March)
6) first full 60,000 shipment (April - May)

think you might be a bit optimistic with 5 & 6

m

[mouse]

As written previously, the 20,000 ton shipment is over twelve months production. We are not yet through the Graben, hopefully will be by the end of this month. We then have to learn how to safely operate the water blasting mining system. So I think we should have the first train to Lyttelton with Pike coal in January.
I do not know how many train loads are required for 20,000 tons. But assume it is all done by the end of January and the coal shipped. We then need to get 60,000 tons out as the next shipment.
HOWEVER, the problem then is we have to train our miners plus assemble stockpiles both at Pike River process area, say 45,000 tons plus another 45,000 tons at Ikamatua. There also needs to be some stockpile at the Lyttelton Port.
We need therefore 100,000 tons before we can safely start to export. Training, plus stockpiles take time. The REAL PROBLEM is the 10km slurry pipeline. Will it actually work? It has worked that is clear. I put my ear to the pipe and heard the tingle sound of coal moving along. But it has to work for 20 hours a day. With a number of massive pumps. Pike have an excellent mining chap who is in charge of the slurry pipeline. I have spoken to him a number of times. He knows about maintaining the system. But others need to learn, and you only learn by breakdowns!!!
I am a Believer, but I doubt if we will see 60,000 tons a month, every month, until twelve months have gone. So hopefully we should have all gremlins sorted by this time next year. This is a mine! It is miles from anywhere. The coal has to go by a 10km slurry pipeline, be processed, trucked to Ikamatua, loaded onto the trains, taken to Lyttelton and loaded onto the ships. People and machinery are involved the whole way. There will be many minor snags and a few massive ones.
I have great confidence in Peter Whittell and Gordon Ward. But they cannot do the impossible. Another piece of info is Peter is off to Wellington and commuting to the mine weekly with a new mine manager starting, may already have started.
There may not be any 'rights call' since there is spare capacity coal that could be used to get another overseas steel mill to put cash in to get a guaranteed supply.
My experience is in preventative maintenance. I have worked on pumping systems for water, but only limited experience. I have electrical qualifications. The maintenance problems for Pike will be solved by hands-on experience. But that takes time and lost production. Hence my forecasts.
Anyone other ideas? I hope I am wrong.
It would be nice if accountants ruled the world, but in the real world it is the miners who actually get the coal out. So, comments please. But also please remember there are Ladies Present.

[the machine]

see pike have update the photo gallery on their website

m

[tricha]

Anyone other ideas? I hope I am wrong.
It would be nice if accountants ruled the world, but in the real world it is the miners who actually get the coal out. So, comments please. But also please remember there are Ladies Present.

WELL I have received an updated report on this lemon.

#1 concern is gas !

# 2 Getting the coal from the mine to the processing plant, does it work.?

#3 the processing plant and the loading facility is not yet commissioned, has the construction guarentee lapsed.:confused:

#4 half the working day is lost, getting the workers from Greymouth to the mine and back ?

# Money, all those workers and no coal to pay the bill, how much more will be needed for this maybe.?

Ask management these questions and see what response u get. In the mean time best of luck folks.

[Baddarcy]

I'm a little puzzelled by the previous post for the following reasons, any chance of a bit more clarification Tricha?

Questions

"WELL I have received an updated report on this lemon" Who did you get this from? PRC have been posting details of all analysts reports on thier web site the last ones they have listed are from back in October 2009.

# 2 Getting the coal from the mine to the processing plant, does it work.? At the AGM they have 17,000 tonnes that had somehow got from the mine to the processing plant, i'm guessing the slurry pipeline got it there.

#3 the processing plant and the loading facility is not yet commissioned, has the construction guarentee lapsed. It seems to have processed 17,000 tonnes ok so far?

# Money, all those workers and no coal to pay the bill, how much more will be needed for this maybe.? PRC have already advised they need another $NZD20m in Feb 2010, your "updated report" didn't mention this?

[JoeBlogs]

Sounds like updated gossip rather than a report.

[Dr_Who]

Sounds like updated gossip rather than a report.

Dont under estimate gossips.

The gossips on PRC have been far more accurate than the crap (announcements) thats come out of PRC management.

[winner69]

Not related tp Pike but big coal miner in WA gone broke .... and they were processing the black gold

[the machine]

Not related tp Pike but big coal miner in WA gone broke .... and they were processing the black gold

thermal coal being produced by griffin in WA

M

[winner69]

thermal coal being produced by griffin in WA

M

and then there is a bidding war for Rocklands Richfield .... coking interests but coal explorer in Aust

[Baddarcy]

Pike should be about through the graben by now, they advised late Dec early Jan on the 7th of Dec.

Am expecting an announcement any day now??? Any thoughts of an effect on SP? I am expecting a bit of a bounce upwards, given it means that thier production of coal will increase from about 1k per week to 3k.

[Balance]

Pike should be about through the graben by now, they advised late Dec early Jan on the 7th of Dec.

Am expecting an announcement any day now??? Any thoughts of an effect on SP? I am expecting a bit of a bounce upwards, given it means that thier production of coal will increase from about 1k per week to 3k.

Baddarcy, just follow the share price. Tells you what is likely to be the announcement coming out next.

Notice how it continues to slip even when other coal miners in Australia are enjoying rallies?

What does that tell you?

[Hoop]

Baddarcy, just follow the share price. Tells you what is likely to be the announcement coming out next.

Notice how it continues to slip even when other coal miners in Australia are enjoying rallies?

What does that tell you?

What does that tell you?...ummmm, let me guess, buy now?????

Balance, seriously now...OK.. charts look bad but better than 3 weeks ago (couldn't get much worse could it?)....however this sharedog seems to have developed a behavioural pattern so far in its short history: hence the warning ...short history data not enough to analyse with confidence?

Strangely.... its opposite or upside down to peoples thinking. (Reverse Psychology?)

1...It was the share to be in (and out) during the cyclic Bear market of 2008 when the masses were panicking for the exits
2...It was a share to buy when volumes were low (is it is now) when nobody wanted it
3...It was a share to sell when the volume suddenly spiked upwards when everybody wanted it.

Disc: own this dog fleas and all.

[Balance]

What does that tell you?...ummmm, let me guess, buy now?????

Balance, seriously now...OK.. charts look bad but better than 3 weeks ago (couldn't get much worse could it?)....however this sharedog seems to have developed a behavioural pattern so far in its short history: hence the warning ...short history data not enough to analyse with confidence?

Strangely.... its opposite or upside down to peoples thinking. (Reverse Psychology?)

1...It was the share to be in (and out) during the cyclic Bear market of 2008 when the masses were panicking for the exits
2...It was a share to buy when volumes were low (is it is now) when nobody wanted it
3...It was a share to sell when the volume suddenly spiked upwards when everybody wanted it.

Disc: own this dog fleas and all.

Be our guest and pick up some more then.

Short history data? History is that the sp moves ahead of a negative or positive announcement.

[biker]

We obviously don't have the full picture of the geology of the mine.
How many more " complex 'graben' like structures " ( as described in the quarterly report) are there? Can the entire seam have a whole series of these? Mining could turn out to be very slow indeed.
It would seem no news is not good news.
Disc. Hold a handful of PRCOA, but not with much enthusiasm at the moment.

[Silverlight]

PRC long term has great potential, but thus far the PRC managament have not done a very good job, this is reflected in the share price. The set backs have all been because of unwise decisions, not unfortunate events.

The Brunner seam has 18m tonnes of proven reserves, and at the latest estimate Paparoa seams (unproven) is 8m tonnes. It will probably be closer to 30 -40m tonnes in the below seams, and this is where the upside opportunity exists for PRC.

[Hoop]

Be our guest and pick up some more then.
.......

Ohh....alright then..if you insist....... Just a little more to add to the collection
5000shares @ 98c. :cool:

[Balance]

PRC long term has great potential, but thus far the PRC managament have not done a very good job, this is reflected in the share price. The set backs have all been because of unwise decisions, not unfortunate events.

The Brunner seam has 18m tonnes of proven reserves, and at the latest estimate Paparoa seams (unproven) is 8m tonnes. It will probably be closer to 30 -40m tonnes in the below seams, and this is where the upside opportunity exists for PRC.

Reserves?

The quantum of the reserves is only what can be economically mined (or as they say in mining, accessible). So far PRC has encountered 'unexpected' problem after problem. As Biker puts it, there could be plenty more problems waiting to be encountered.

If their planning was any good, they would have anticipated the soft rocks, fractured rocks etc. The collapse of the ventilation shaft is the tip of the ice-berg. What kind of idiot builds a shaft in fractured rocks?

Do not count the reserves until PRC can show it can mine 80,000T per month. The Ballarat Gold write-off by Lihir (US$400m) saga is a salutary example of proven reserves which proved to be economically non viable to mine.

[Baddarcy]

I don't think that it is unwise decisions it's more likely just a lack of perparation that has affected this stock. If they had done more pre drilling they would have known about the graben.

I think the point that Balance and others is missing is that PRC are getting closer and closer to the producing meaningful amounts of coal stage.

Sure, there have been setbacks, a plenty, but they are being overcome one by one and each time PRC is getting closer and closer to full production. progress have being made.

We all know once that happens the share price will go off, there is risk of course, but i personally are willing to take it. I made plenty out of NPX and am willing to gamble it on PRC, whose with me!!! :-)

DISC: Had 4 or maybe it was 5 beers at the pub before writing this post :-)

[Balance]

I don't think that it is unwise decisions it's more likely just a lack of perparation that has affected this stock. If they had done more pre drilling they would have known about the graben.

I think the point that Balance and others is missing is that PRC are getting closer and closer to the producing meaningful amounts of coal stage.

Sure, there have been setbacks, a plenty, but they are being overcome one by one and each time PRC is getting closer and closer to full production. progress have being made.

We all know once that happens the share price will go off, there is risk of course, but i personally are willing to take it. I made plenty out of NPX and am willing to gamble it on PRC, whose with me!!! :-)

DISC: Had 4 or maybe it was 5 beers at the pub before writing this post :-)

Always right to make investment decisions after a few cold beers on a beautiful summer day.

Just be mindful though that there is a big cost to the delays and the problems - more and more capital raised and more and more shares issued. You cannot budget a $5m building, spent $10m due to problems and still say it is getting close to be tenanted and cash will flow, so everything is okay. The risk/reward equation has blown out in the wrong direction.

I suspect next announcement will be - we are through the graben! BTW we need more capital.

[Dr_Who]

I have to agree with Balance on this one, even thou we dont see eye to eye on alot of things.

PRC will be put in the ... so much potential, but so little talent to realize it... basket.'

I so much want to own PRC shares and so much want it to succeed, but at the end I sold all my shares due to my lack of confidence in management. The Aussie miners can have my money instead.

[mouse]

The report of gas in the underground mine is not really news. I think all underground mines have gas. Which is why explosion proof equipment is used and why smoking is banned. An interesting piece of gossip from The Blackball Hilton when I was there. A miner came off shift at Pike and lit up a cigarette. He was immediately sacked. Quite right too. The amount of gas in thePike seam is limited since one end of the seam is open at one end. Look at the schematic drawings.

[manxman]

I don't think that it is unwise decisions it's more likely just a lack of perparation that has affected this stock. If they had done more pre drilling they would have known about the graben.

The western escarpment, where the seam is exposed, shows a continuous bed of coal uninterrupted in the North/South direction by Horsts or Grabens. In the East/West direction, a Graben close to the Hawera fault has proved to be a serious problem, but remember that the preliminary drilling was severely limited by National Park considerations. Realistically they could not have conducted a much more comprehensive exploratory drilling program. The in-seam drilling program would be designed to remedy this deficiency. Further horst/graben disruption to the coal will be less serious because the road and sluice ways can simply be planned to cope, once the mine plan is extended over a reasonable distance. Having the first graben so close to the tunnel means that almost the first coal is below the pit bottom, cannot be sluiced out, and has to be abandoned in the meantime. Skip across the graben, and things start looking better. Any further grabens can be worked successfully as the coal appears to rise to the North and West. There will be some cost penalty compared with the lovely uniform coal seam shown in the prospectus, but hells teeth, look whats happening to the price of coal.




DISC: Had 4 or maybe it was 5 beers at the pub before writing this post :-)
In Vino Veritas

[tricha]

I'm a little puzzelled by the previous post for the following reasons, any chance of a bit more clarification Tricha?

Questions

"WELL I have received an updated report on this lemon" Who did you get this from? PRC have been posting details of all analysts reports on thier web site the last ones they have listed are from back in October 2009.

# 2 Getting the coal from the mine to the processing plant, does it work.? At the AGM they have 17,000 tonnes that had somehow got from the mine to the processing plant, i'm guessing the slurry pipeline got it there.

#3 the processing plant and the loading facility is not yet commissioned, has the construction guarentee lapsed. It seems to have processed 17,000 tonnes ok so far?

# Money, all those workers and no coal to pay the bill, how much more will be needed for this maybe.? PRC have already advised they need another $NZD20m in Feb 2010, your "updated report" didn't mention this?

Can u not read, ask management ?? #1 issue high concentrations of gas = boom.

Maybe this should be used for a CSG plant.

Maybe u should do a site visit. ?

[Baddarcy]

Can u not read, ask management ?? #1 issue high concentrations of gas = boom.

Maybe this should be used for a CSG plant.

Maybe u should do a site visit. ?

Perhaps you could answer my question instead of throwing insults at me? What is your source for your gas claims?

You previously claimed to have received a "updated report" during the christmas break that no one else seems to have...... did you read it in there?

I find it a bit odd given that most of PRC's current drilling is being done through rock yet you are claiming there is a CSG problem, i might be wrong but i thought CSG was present in coal not rock, hence the name Coal Seam Gas?

[Baddarcy]

Always right to make investment decisions after a few cold beers on a beautiful summer day.

Just be mindful though that there is a big cost to the delays and the problems - more and more capital raised and more and more shares issued. You cannot budget a $5m building, spent $10m due to problems and still say it is getting close to be tenanted and cash will flow, so everything is okay. The risk/reward equation has blown out in the wrong direction.

I suspect next announcement will be - we are through the graben! BTW we need more capital.

I actually agree with Balance too on this one. They have already said they require another $NZD20m in Feb.

For me how they raise this will say a lot about the stock, if they go for a capital raising from shareholders it basically tells me that they do not believe that they will hit full production by June and thus further diluting the shares is their best option. This isn't the best option for shareholders in my opinion.

If they borrow the money then it shows me that they do think they will get to full production by June, thus they will have the capacity to repay the borrowed money from cashflows or in April 2011 when the options come due, as long as the share price is over $1.25 they will get $80m in cash from the options. It also shows to be that a bank or financer also believes they are going to get there in June

[Balance]

I actually agree with Balance too on this one. They have already said they require another $NZD20m in Feb.

For me how they raise this will say a lot about the stock, if they go for a capital raising from shareholders it basically tells me that they do not believe that they will hit full production by June and thus further diluting the shares is their best option. This isn't the best option for shareholders in my opinion.

If they borrow the money then it shows me that they do think they will get to full production by June, thus they will have the capacity to repay the borrowed money from cashflows or in April 2011 when the options come due, as long as the share price is over $1.25 they will get $80m in cash from the options. It also shows to be that a bank or financer also believes they are going to get there in June

So the only ones who will know well ahead of time are insiders and those who frequent the pubs in Westport. No doubt the pub patrons will move the sp ahead of any announcement for you, no worries. Or maybe, they already have?

[Baddarcy]

So the only ones who will know well ahead of time are insiders and those who frequent the pubs in Westport. No doubt the pub patrons will move the sp ahead of any announcement for you, no worries. Or maybe, they already have?

Hmm have noticed a few decent sized trades going through over the last 3 days, about 200,000 on Wednesday, 350,000 yesterday and another 200,000 a few minutes ago.

None of these trades changed the buy and sell volumes available, so it would seem someone is accumulating the stock (and someone selling too i suppose). Guess they use the same broker so the trades don't go to market.

[Billy Boy]

Hmm have noticed a few decent sized trades going through over the last 3 days, about 200,000 on Wednesday, 350,000 yesterday and another 200,000 a few minutes ago.

None of these trades changed the buy and sell volumes available, so it would seem someone is accumulating the stock (and someone selling too i suppose). Guess they use the same broker so the trades don't go to market.

I have noticed the same.... Probably insto's swapping or the same
insto shifting from one account to another. ?
BB

[Hoop]

I have noticed the same.... Probably insto's swapping or the same
insto shifting from one account to another. ?
BB
Could be...
Looking at the depth there is a IN code
97.6 250,000 14:02 IN

IN is for international, what does this mean?..

OS is overseas...PF is portfolio marriage...SP is off market, so I assume the trade went through the market but could it still be shifting from one account to another with an IN code only?

[Billy Boy]

Info for posters
Go to Direct Broking
Under Glossary :-
go to Depth
Code conditions are listed there
NZX & ASX
Cheers BB:)

[Billy Boy]

Could be...
Looking at the depth there is a IN code
97.6 250,000 14:02 IN

IN is for international, what does this mean?..

OS is overseas...PF is portfolio marriage...SP is off market, so I assume the trade went through the market but could it still be shifting from one account to another with an IN code only?

Hoop
I think some O/Seas invester buying in.
Pitty we dont get codes for "which Insto"
BB:)

[Bixbite]

Hoop
I think some O/Seas invester buying in.
Pitty we dont get codes for "which Insto"
BB:)

If I were a rich man and wished to get a big slice for this company, I would send a mediator to negotiate with Liberty Harbor to take over its Pike’s US$27.5m Convertible Bonds – if the Convertible Bonds were transferable – to other parties.

[Billy Boy]

If I were a rich man and wished to get a big slice for this company, I would send a mediator to negotiate with Liberty Harbor to take over its Pike’s US$27.5m Convertible Bonds – if the Convertible Bonds were transferable – to other parties.

Well yes But........ ?
Who says its a real rich man ?
Maybe Liberty harbour dont want to sell !
Maybe this invester does'ent want more than 5%.
Maybe this investor is slowly accumulating...!
It could even be Liberty Harbour buying in through the back door.
or may be.... and maybe.... and what ever !!!
BB:)

[Balance]

If I were a rich man and wished to get a big slice for this company, I would send a mediator to negotiate with Liberty Harbor to take over its Pike’s US$27.5m Convertible Bonds – if the Convertible Bonds were transferable – to other parties.

A rich man would have bought into Australian coal miners and would be laughing his head off at the punters in PRC who are still waiting for coal to come out of the ground - 2 years later!

[Balance]

Well yes But........ ?
Who says its a real rich man ?
Maybe Liberty harbour dont want to sell !
Maybe this invester does'ent want more than 5%.
Maybe this investor is slowly accumulating...!
It could even be Liberty Harbour buying in through the back door.
or may be.... and maybe.... and what ever !!!
BB:)

Looking at where the price was crossed at, more like a local selling to an offshore buyer. So who's the smart one?

[Billy Boy]

Looking at where the price was crossed at, more like a local selling to an offshore buyer. So who's the smart one?

So who's the smart one .......!
an offshore buyer
yA GOT EM ROUND DA RONG WAY bALANCE
:D:D
BB

[Balance]

Nail on the head Rabbi...
I should have gone the options way and did'nt. :o Bugger !!!
However.... there is a lot more money out there than most think,
wise money waiting to pounce.
BB

LOL ....way back in April 2009, BB - wise money waiting to pounce indeed! Turned out they pounced on a pile of coal dust!

Since then, MCC has gone from $4.25 to $11.96 (180% gain), GCL has gone from $5.00 to $9.90 (98% gain).

And PRC? Just another year more of delays and more capital please.

[Hoop]

Hoop
I think some O/Seas invester buying in.
Pitty we dont get codes for "which Insto"
BB:)

Yeah ..pity
I may keep a eye on the depth next week.
BB.. you Mainlanders aren't classified as overseas r u ?? ...Nah, just Kidding;)

[svez01]

LOL ....way back in April 2009, BB - wise money waiting to pounce indeed! Turned out they pounced on a pile of coal dust!

Since then, MCC has gone from $4.25 to $11.96 (180% gain), GCL has gone from $5.00 to $9.90 (98% gain).

And PRC? Just another year more of delays and more capital please.

Is this not a good sign for Pike? Does it not show the future potential when they ramp up production?

If it does now would be a good time to buy before the price rises.

[mouse]

It is 10th January. Are we through the Graben yet? When will we export 20,000 tons of coal? Any news? Anyone heard? Any Gossip?

[Billy Boy]

It is 10th January. Are we through the Graben yet? When will we export 20,000 tons of coal? Any news? Anyone heard? Any Gossip?

Watch the Lyttelton shipping reports
http://www.lpc.co.nz/RP.jasc?session=515B775AF30BE053A398EECDB43FC2&Page=LPCShippingForecastNetApp&Node=N38P0

Cheers BB :)

[Balance]

Is this not a good sign for Pike? Does it not show the future potential when they ramp up production?

If it does now would be a good time to buy before the price rises.

You go to the race track and keep betting on the horse that comes in last, hoping that one day it will come first?

[Baddarcy]

Seems to be rush hour on the PRC shares this morning, something like 250k traded in the first 3 minutes.

Announcement due maybe?

[Billy Boy]

Seems to be rush hour on the PRC shares this morning, something like 250k traded in the first 3 minutes.

Announcement due maybe?

Na........ Just Monday morning jitters

[Odd Fellow]

The "Ocean Paradise" is in Lyttelton and picking up a load
of coal, you can see the webcam picture here:

http://www.lpc.co.nz/RP.jasc?session=BD2B8EEB71D4D76952996CEE548AC5&Page=N225P2

I hope it is a ongoing event now and we are back into business. :D

Cheers.

[Balance]

The "Ocean Paradise" is in Lyttelton and picking up a load
of coal, you can see the webcam picture here:

http://www.lpc.co.nz/RP.jasc?session=BD2B8EEB71D4D76952996CEE548AC5&Page=N225P2

I hope it is a ongoing event now and we are back into business. :D

Cheers.

LOL -That must be coal from Solid Energy, nor PRC.

If it was PRC's coal, they will be shooting fireworks into the night sky and setting some of said coal on fire to make a real scene of it.

[Odd Fellow]

LOL -That must be coal from Solid Energy, nor PRC.

If it was PRC's coal, they will be shooting fireworks into the night sky and setting some of said coal on fire to make a real scene of it.


I was hoping it is from PRC, I did not know Solid Energy has coal
over there too.

OK, then we have to wait a bit longer. :confused:

Cheers,

[Baddarcy]

Na........ Just Monday morning jitters

Somebody is buying a fair few shares today, just past 750,000 so far today!!

And another 490,000 on the ASX so thats almost 1.25m today so far.

[Silverlight]

225k of the shares on NZX are international crossings so you can eliminate those (ASX trades reported back here), but still biggest day since 1.7m traded on 17 November.

[patrick]

Good volume.
Purchasers must be satisified that the surry line can deliver a 116 tons of coal an hour to produce 1000,000 tons a year.
Seems a lot of coal to me!

[Billy Boy]

Somebody is buying a fair few shares today, just past 750,000 so far today!!

And another 490,000 on the ASX so thats almost 1.25m today so far.

Yea.....
I recon they are through the Garben.....
OA'S have a little movement as well. low volume.
Doubt they will say much until they are sure.
Dont want to hit another bugger do they !!!
Announcement this week maybe ??
BB

[Balance]

Yea.....
I recon they are through the Garben.....
OA'S have a little movement as well. low volume.
Doubt they will say much until they are sure.
Dont want to hit another bugger do they !!!
Announcement this week maybe ??
BB

So what? This was the announcement in Aug 09 about how confident they were about meeting Nov deadline.

Problem after problem after problem.

Reassurance after reassuurance after reassurance.

Failure to deliver after failure to deliver after failure to deliver.


Capital raising after capital raising - you get the picture?

It's only been goling on for 2 years!

What's another year?



Pike River Coal delays first shipment; confidence deadline will be met
Home » News » Business
By Simon Hartley on Sat, 1 Aug 2009
News: Business
Listed hard-coking coal specialist Pike River Coal has put back its inaugural coal shipment by six weeks until mid-November but says it will meet the deadline of a convertible bond holder to have "steady" production by the end of November.

Pike also announced striking a deal with Japanese steel producers to deliver coal, an integral part of the steel-making process, at $US128 ($NZ195) per tonne.

The $US128 was an anticipated price and matched benchmark prices achieved by major Australian coal producers, Pike River chief executive Gordon Ward said in a statement.

However, 14 months ago Pike was contracted to deliver its first coal at $US300 per tonne and its management and analysts were confident at the time that the 2009-10 prices would be in the $US270-$US300 range.

ABN Amro Craigs broker Peter McIntyre said Pike "exhibited all the problems" associated with any mining venture start-up, including delayed production, fluctuating commodity prices and financing issues during the credit crunch.

"They are running a fine line to reach the November deadline. But they have the backing of major shareholders," he said of the potential for bond holder Liberty Harbor to make a claim for Pike missing its deadline condition.

Mr Ward said the first 60,000 tonnes of coal for export to Japan was delayed because of "teething problems" in getting production under way - a delay which follows a rock fall in February which impeded mine development by eight to 12 weeks.

"Pike River has sufficient funding in place to accommodate the [six-week] delay and it is on track to meet the Liberty Harbor convertible bond condition that first steady-state production is demonstrated by November 30, 2009," Mr Ward said.

The Liberty bond condition requires Pike River to be capable of producing 800,000 tonnes in the following year to November 30, 2010, or face penalties.

"The mine infrastructure is in place and once hydro-mining commences, the Pike River mine will be capable of producing in excess of one million tonnes per year," he said.

Liberty Harbor LLC has $US27.5 million in convertible bonds and could call on Pike to hand over 2.3 million ordinary shares, or the cash equivalent, if the November 30 deadline is missed.

At a share price of $1.12 the 2.3 million ordinary shares would be worth $2.576 million.

Pike River, which raised $41 million in a rights issue in April and could reap a further $73 million from future bonus share options, has said if necessary Liberty Harbor could be paid from the rights issue.

[dsurf]

Interesting post Balance. Enjoyed reading it, especially the part about "teething problems". Until first coal delivered it is hard to see SP moving up.

[mouse]

Information is that Pike, actually contractors, are still working on the Graben. So we are not through the Graben yet. No information on when we will be through it but the contractors have been on holiday. Coal trucks are starting to move coal from mine to rail today. First shipment from Lyttelton later this month.

[mouse]

Information is that Pike, actually contractors, are still working on the Graben. So we are not through the Graben yet. No information on when we will be through it but the contractors have been on holiday. Coal trucks are starting to move coal from mine to rail today. First shipment from Lyttelton later this month.

Sorry, train load to Lyttelton later this month. Presumably shipment to India soon after.

[the machine]

Information is that Pike, actually contractors, are still working on the Graben. So we are not through the Graben yet. No information on when we will be through it but the contractors have been on holiday. Coal trucks are starting to move coal from mine to rail today.

thanks mouse re coal starting to be trucked.

some positive cashflow for pike for the week of the shipment is now expected


although some posters may go to trouble of counting how many prior weeks of negative cash flow there has been.

M

[Balance]

thanks mouse re coal starting to be trucked.

some positive cashflow for pike for the week of the shipment is now expected


although some posters may go to trouble of counting how many prior weeks of negative cash flow there has been.

M

Indeed - and anyone who has taken PRC's positive pronouncements of breakthroughs in the last 2 years (eg. tunnel completed, coal preparation plant in place, hiting coal face, fircst coal mined etc) with a big spoonful of salt has done the right thing.

2 years. And posters here think that Eric Watson is one bad dude?

[mouse]

I forgot to include in my post that the contractors are drilling and blasting through the Graben. So any indication that there is a major problem with gas in the mine seems to me to be very overstated. Since if there was a major gas problem, how would they be using explosives in the mine? Admittedly they probably use a water spray just prior to detonation but it still indicates a stable mine. Any other gossip/information is welcome.

[Hoop]

Thxs for the info Mouse
Much appreciated :)
Hoop

[fish]

* Books
* Newsletters

* NZX

ALLOT: PRC: Issue of Securities

13 Jan 2010 3:54 pm

PRC 13/01/2010 ALLOT

REL: 1554 HRS Pike River Coal Limited

ALLOT: PRC: Issue of Securities

ISSUE OF SECURITIES Announcement in terms of listing rule 7.12.1

Please be advised of an issue of securities as follows;

(a) Class of Security - Convertible Bonds, fully paid, unlisted. (b) Number issued - 16.67 (c) The nominal value and issue price - US$50,000 per bond (no nominal value). (d) Consideration was interest of US$833,500 due for the period 1 April 2009 to 31 December 2009. (e) N/A. (f) The percentage of the total class of securities issued - 2.94% (g) The reason for issue - payment of interest due for the period 1 April 2009 to 31 December 2009 met by the issue of new Convertible Bonds in accordance with the Deed dated 13 March 2009. (h) The specific authority for the issue - Supplemental Deed between Pike River Coal Limited and Liberty Harbor LLC dated 13 March 2009. (i) The terms or details of the issue - rank pari passu with existing Convertible Bonds. (j) Total number of listed securities in existence after the issue - 347,530,772 Ordinary Shares; 64,281,875 Options (2011). (k) N/a (l) Date of issue - 12 January 2010. End CA:00190141 For:PRC Type:ALLOT Time:2010-01-13:15:54:07

[Billy Boy]

Thxs for the info Mouse
Much appreciated :)
Hoop

Ditto here
Good one mouse:)

[freddy]

I forgot to include in my post that the contractors are drilling and blasting through the Graben. So any indication that there is a major problem with gas in the mine seems to me to be very overstated. Since if there was a major gas problem, how would they be using explosives in the mine? Admittedly they probably use a water spray just prior to detonation but it still indicates a stable mine. Any other gossip/information is welcome.

This does not mean anythingh. The graben is rock. Thats why they are drilling and blasting. Gas occurs when in coal.

[Balance]

This does not mean anythingh. The graben is rock. Thats why they are drilling and blasting. Gas occurs when in coal.

Tells you a lot about the quality of analysis and understanding of the type of punters PRC has managed to attract.

Mushrooms, anyone?

[Casa del Energia]

This does not mean anythingh. The graben is rock. Thats why they are drilling and blasting. Gas occurs when in coal.

Still means nothing - if you place the DSE with the det cord and an electric det entirely in the hole - then the tamping completely absorbs the flash. All you get is a bit of smoke leaking out (So long as you don't over charge).

Blasters are a careful lot and usually start with an undersized charge when approaching a new situation. Fly rock is embarrassing to a blaster - it's a sign of incompetence.

Edit: forgot to mention - miner tend to use nonel detonators anyway - the lines contain the flash and you can set up multiple charges withot exposing PETN det cord outside the shot holes

[root]

I'm learning a lot about blowing stuff up.

[winner69]

I think Orica Mining Services are involved in the blasting so hopefully as an ORI shareholder it takes them ages ages and ages

[Bilo]

Adhunik Metaliks Seeks to Buy Australian Coal Mine


By Abhishek Shanker
Jan. 13 (Bloomberg) -- Adhunik Metaliks Ltd. (http://www.bloomberg.com/apps/quote?ticker=ADML%3AIN), an Indian maker of steel products for the automobile industry, is seeking to buy a 30 percent stake in a coking coal mine in Australia to ensure supply and pricing of the raw material.
The Kolkata-based company will spend up to $80 million on an operating mine, Managing Director Manoj Kumar Agarwal (http://search.bloomberg.com/search?q=Manoj+Kumar+Agarwal&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) said today by phone. Adhunik needs about 300,000 metric tons of coking coal a year.
“We hope to source all our coking coal requirements from the Australian mine,” Agarwal said without giving a timeframe or naming targets. “There are good quality coking coal mines available in Australia.”
Contract prices for coking coal may surge by about 36 percent this year to $175 a metric ton, as global demand rebounds, Morgan Stanley said today. Indian steelmakers, whose sales revived faster than their international peers, are looking for additional raw material supplies.
Indian steel consumption in the nine months to December grew 7.7 percent, boosted by demand from power projects, the construction industry and makers of car.
The Economic Times today reported that the Adhunik Group of Industries has initiated talks to acquire 50 percent of an Australian coking coal mine, citing an unidentified person.
To contact the reporter on this story: Abhishek Shanker (http://search.bloomberg.com/search?q=Abhishek+Shanker&site=wnews&client=wnews&proxystylesheet=wnews&output=xml_no_dtd&ie=UTF-8&oe=UTF-8&filter=p&getfields=wnnis&sort=date:D:S:d1) in Mumbai at ashanker1@bloomberg.net (ashanker1@bloomberg.net)
Last Updated: January 13, 2010 04:14 EST

[patrick]

AND the slurry line still has to deliver 116 tons of coal each hour,365 days a year?

[mouse]

AND the slurry line still has to deliver 116 tons of coal each hour,365 days a year?

I got 114 tons of coal each hour, 365 days a year. But it is still an incredible amount of coal. Wonder if they can do it? Of course then they have to process it and send it by truck to Ikamatua. Three 40 ton trucks an hour, 24 hours of the day.

[fish]

I got 114 tons of coal each hour, 365 days a year. But it is still an incredible amount of coal. Wonder if they can do it? Of course then they have to process it and send it by truck to Ikamatua. Three 40 ton trucks an hour, 24 hours of the day.

Future price for premium metallurgical coal is looking very rosy in India .This is likely to impact on ultimate profits far more than the production rate-once over these initial unfortunate problems

[bermuda]

Future price for premium metallurgical coal is looking very rosy in India .This is likely to impact on ultimate profits far more than the production rate-once over these initial unfortunate problems

Spot on Fish. Don't hold any but watching with interest. Coking coal prices getting stronger by the day and the coal ship queues are lengthening.

If they can get this stuff out of the mine...and Peter Whittall assured me he could...then hopefully price increases will look after the delays and additional costs.

Good luck to all holders.

[Bixbite]

I got 114 tons of coal each hour, 365 days a year. But it is still an incredible amount of coal. Wonder if they can do it? Of course then they have to process it and send it by truck to Ikamatua. Three 40 ton trucks an hour, 24 hours of the day.

Copy and paste.

Slurry Coal Pipeline
“From the mine, crushed coal at a sizing of minus 35mm will be pumped via a pipeline to the CPP, a distance of approximately 10.6km. The pipeline nominal capacity is in excess of that required to achieve the tonnage delivery rates.”

“TNL truck-and-trailer units can carry 30 tonnes of coal each day between 6 am and midnight under conditions set by resource consents and all loads will be covered to ensure dust is contained.”

“The 250 kilometre journey to Lyttelton will be handled by train sets of 45 wagons, and loading at Ikamatua will take one-and-a-half hours per train.
When Pike River's production reaches one million a tonnes a year, trains will be loaded at the rate of one or two a day.”

[Bixbite]

Future price for premium metallurgical coal is looking very rosy in India .This is likely to impact on ultimate profits far more than the production rate-once over these initial unfortunate problems

They could put an extra slurry coal pipeline there if it needed.

e.g. If the cost is US$10,000,000, it is equal to US$0.55 per ton

[the machine]

They could put an extra slurry coal pipeline there if it needed.

e.g. If the cost is US$10,000,000, it is equal to US$0.55 per ton


the game starts with getting the first shipment underway rather than any production constraints.
the value of my pike investment has halved and sp needs to double before I can feel a lot better about company.
sure, once production increases and some further shipments then sp should recover a bit -say 25%, but pike needs to deliver over next year before sp will double todays price

M

[swissboy]

No mention by anybody regarding the agreement reached with Liberty. I bet they will know exactly how far through the Graben we are at present, whereas we are kept in the dark.
I think it is a probably a good thing that they are willing to accept extra shares as payment of the agreement, but what will be the dilution affect of these extra shares??

[winner69]

...... but what will be the dilution affect of these extra shares??

Stuff all because PRC is such a big company with a market cap in excess of $300m

But obviously cash is very precious eh .... hope they don't start paying the staff in shares then

[Balance]

the game starts with getting the first shipment underway rather than any production constraints.
the value of my pike investment has halved and sp needs to double before I can feel a lot better about company.
sure, once production increases and some further shipments then sp should recover a bit -say 25%, but pike needs to deliver over next year before sp will double todays price

M

Errrr.

I have read the game starting with :

Tunnel finished
Producing first coal
Clearing ventilation shaft
Getting new machinery to work
Breaking through the graben.

Bet you there will be more grabens ahead and more loose rock. The problems encountered so far show PRC has no idea of the geology of the mine.

[Baddarcy]

Errrr.

I have read the game starting with :

Tunnel finished
Producing first coal
Clearing ventilation shaft
Getting new machinery to work
Breaking through the graben.

Bet you there will be more grabens ahead and more loose rock. The problems encountered so far show PRC has no idea of the geology of the mine.

Sorry Balance but you are not correct. PRC have checked and have confirmed nothing but coal on the other side of the graben.

We have to keep in mind that PRC are tunnelling into a mountain range to drill coal, not walking down to the corner to buy an ice cream. To expect everything to happen perfectly and without any problems would be naive.

PRC's shares are trading at their IPO price and above the 2 capital raising prices (90 and 75), the reason for this is simply because the market believes PRC will be successful, if the market thought otherwise the price would be lower, much lower. But all those that participated in the IPO and took up their rights in the subsequent capital raisings are still in the money even at 100.

[Balance]

Sorry Balance but you are not correct. PRC have checked and have confirmed nothing but coal on the other side of the graben.

We have to keep in mind that PRC are tunnelling into a mountain range to drill coal, not walking down to the corner to buy an ice cream. To expect everything to happen perfectly and without any problems would be naive.

PRC's shares are trading at their IPO price and above the 2 capital raising prices (90 and 75), the reason for this is simply because the market believes PRC will be successful, if the market thought otherwise the price would be lower, much lower. But all those that participated in the IPO and took up their rights in the subsequent capital raisings are still in the money even at 100.

If they put their money into proven coal miners like MCC, they would have made several hundred % on their money.

PRC was always high risk and therefore, investors have not done well at all for the fisk they took.