PRC Pike River Coal

[geezy]

I think sp will head north from here now with transport sorted, should affect NZO's sp too i believe

[Bilo]

As a resident of Greymouth I feel we got shafted We could have done with that belly port though. Damn!
>>Whirly, Central Government should have built your port. At least finance it. The Australian government does. Wellington were prepared to give $600k for 5years, which is much cheaper than providing proper port facilities. Encouraging coastal shipping - joke.

[Kropotkin]

>Whirly, Central Government should have built your port. At least finance it.

Totally correct.
Blaming PRC for having an 'Option B' when negotiating is ridiculous.

[duncan macgregor]

It seems that i owe an appoligy to PRC management for my latest postings which were in no way meant to infer that they have done any wrong doing. If that is the impression i gave then i am truely sorry and take it all back. Sharetrader has received a complaint from a private member and on reading back i can see their point of view and apologise. MACDUNK

[Zaphod]

Zaphod for god's sake have you ever heard of a coal company that loads straight on to a big ocean going cargo ship.There will have to be some stock pilling somewhere. Pike now is about as simple as it will get. Maybe in earlier times the easy coal was better located but with all resorces the easy stuff is all gone.
This railing to Littleton sure is a big plus.

Digger - The point is it is still double-handling, and for others in this group to asert that it is not, is simply obsurd.

[Zaphod]

The arrangement to ship coal from a disused shallow port through another port that needed upgrades was always going to be a problem. The capital cost was half that of the mine itself, which indicates the scale of the work required.


How much tax-payer funds are now going to be ploughed into upgrading the track versus how much was going to be ploughed into shipping vessels?

Remember, we're all tax payers too!



PRC was not left with a lot of options - that they managed to come up with an alternative, at a very competitive rate, is a tremendous result for the company. There will obviously be some upset parties, but the root cause of the loss of the contract was their own inability to deliver - even after being granted a number of extensions. It was not a simple case of PRC seeking any opportunity for an out.

I'll be interested to see what the final settlement is, as that will give us a clue as to the distribution of blame. Hopefully it's not PRC... I'll keep my fingers crossed! :P

[Nitaa]

I love success stories. Up 6 cps on good volume. Plenty of criticism has been spoken about PRC. Some of that criticism has come from me. Some significant buyers are entering into this company and that in itself bodes well.

The sp is up about 30% from its lows and its nice to see the ones who got bagged investing into stock are now starting to benefit from the increase in confidence.

There has been some comment on the way and ethics that PRC are handling the transportation issue. basically we dont know what the contract terms are exactly but only know in general. At the end of the day, the company is responsible to its shareholders and thereby returning the maximum value to them. Its a constant problem for any supplying company to put so much work in with no guarentee of any return. For WACC or whoever to be given the opportunity to to try and negotiate with PRC for the transporting route does not automatically give them the right to win the contract. Of course the failed participants will be disapointed but that is business. Ethically on face valu i see nothing wrong. Business wise it seems like a no brainer.

[upside_umop]

still good time to buy. just not as good as two weeks ago...or even one week ago :P

$1.15-1.20 before xmas imo

bugger me. hit 1.15 within 6 weeks of this prediction, prc has run pretty hard over the last couple of days..for prc anyway. not sure how much higher it could go by xmas...
if they do get court action against them, it will put a dampner on it i would think...but like everyone saying, it could just be the media bloating.


Zaphod, i think the marginal cost to transport that extra coal is little. Dont you worry, solid energy and transrail will be making money out of this, esp when they have given PRC priority coal transport.

[bermuda]

Exactly Xerof,
The Indians have been buying up/into Aussie coalers for the last few years.They would love to get hold of Pike but hopefully the present 2 will sit it out and then exit in year 3 when everything will be at its peak giving them and NZO a maximum return.

Perhaps the price increse today was due to further interest from the Indians.

[digger]

Digger - The point is it is still double-handling, and for others in this group to asert that it is not, is simply obsurd.

Zaphod with thinking it always depends on your general outlook and where you are coming from. I have found it pays to think in relative terms and not in absolute. So to me the average industry general handling of coal from the coal face to the market is one unit.It matters little to me how many time the coal is handled inside that one unit as that cost will be faced by all in that industry. So before the railing deal PIKE was facing double handling as it made up twice the industry average handling.To me it is as simple as that. Looks like the market agrees that we now face only one unit of handling and not double.
Zaphod did you buy and in the IPO? I took up only 2/3 of my entitlement and have been rounded up by my family for doing so. Was i right afterall and will the knockers accept that or wait in the wing for some small hickup to return?

[manxman]

Why not cut down the handling even more by piping the coal from the CPP to a new rail loading point opposite the end of Logburn Road. Distance - about 10k Fall - about 100m. Zero pumping energy. All the abrasive material will have been removed at the Coal Prep Plant so getting a twenty year pipeline life shouldn't be a problem. It could re-use the same water that brings the coal down to the CPP.

A 450mm pipe can handle 5 million tonnes/year so we would be looking at 300mm diameter. Not a huge expense. A serious operator might consider a slurry pipeline direct to Lyttelton.

Mx

[Billy Boy]

A serious operator might consider a slurry pipeline direct to Lyttelton.

Mx

Slurry pipeline wont work up hills. They tend to block you know.
BB

[manxman]

Slurry pipeline wont work up hills. They tend to block you know.
BB

Yep. A step to far. Shovelling it all out for a restart could be a problem. I stand corrected.
Mx

[sideline]

Why not cut down the handling even more by piping the coal from the CPP to a new rail loading point opposite the end of Logburn Road. Distance - about 10k Fall - about 100m. Zero pumping energy. All the abrasive material will have been removed at the Coal Prep Plant so getting a twenty year pipeline life shouldn't be a problem. It could re-use the same water that brings the coal down to the CPP.

A 450mm pipe can handle 5 million tonnes/year so we would be looking at 300mm diameter. Not a huge expense. A serious operator might consider a slurry pipeline direct to Lyttelton.

Mx

A fall of 100m on 10k distance (i.e. 1%) might not be enough for coal slurry. But couldn't it be cheaper
to extend the rail track 10k to reach the dewatering plant. Maybe alongside or as part of the access road?
Then you could do away with the trucks alltogether and load directly onto trains.

[digger]

A fall of 100m on 10k distance (i.e. 1%) might not be enough for coal slurry. But couldn't it be cheaper
to extend the rail track 10k to reach the dewatering plant. Maybe alongside or as part of the access road?
Then you could do away with the trucks alltogether and load directly onto trains.

Now your talking.Your on to it sideline. No doubt it has been considered or is being considered. Sounds like a good idea to me but i do not know any of the terain so maybe there is some problems,but still worth looking into.

[AMR]

I don't know if this has been done yet, but can someone computed the sums of what the new EPS per share is in 2009 if the exchange rate stays at current prices and the price of coal hits $145 USD?

[temuk]

the only problem I can see with a railway line to the prep plant is
the Grey River at the end of the road!
I can't remember seeing it when I was there but looking at the map
it is a shingle braded river and would need a rather bigish bridge.

[temuk]

just had a look at google earth and where I think is logburn rd and there is a narrow bit of river between the end of the road and Ahaura
about 3 km away.

Anyone else got a better map???

[manxman]

just had a look at google earth and where I think is logburn rd and there is a narrow bit of river between the end of the road and Ahaura
about 3 km away.

Anyone else got a better map???

Looking at 1:50000 topo map its about 1 km between the stopbanks. There are some permanently vegetated islands but not something that you would rely on for twenty years. A rail bridge would have to be above the flood level, and that probably gets you stuck with a kilometre of bridge.
Mx

[Bilo]

I don't know if this has been done yet, but can someone computed the sums of what the new EPS per share is in 2009 if the exchange rate stays at current prices and the price of coal hits $145 USD?

My model indicated at IPO between 110 and 130cps @ PE 5.5 (POC USD90)

AT POC USD120 rate at .76
cps 180 to 210 @ PE 5.5

AT POC USD145 rate at .76
cps 240 to 290 @ PE 5.5

No update for progression of time or reduced transport costs.....

NZO's 62M shares are looking good. Option exercise price on 11M more for NZO is 1.30. Each 10cps on PRC is worth over 3cps on NZO and there has been zero movement in NZO with 20cps increase in PRC share price....

Somebody else has obviously done the maths....and is buying heaps...

Long term USD145 brings the NZOODs into play....by itself....

[Dr_Who]

Yep, bought some more NZO. Looking cheap with PRC at these levels. :) The fall in oil prices is a opportunity to have further exposure to oil stocks.

[Rabbi]

Looks like the market likes the new transport arrangements.
It's not so much that rail is 10% cheaper but alot of uncertainty and risk has been removed by this decision, and the market likes certainty.
With the final push to the coal face to come this stock should consolidate nicely in the new year.
The prospect of a takeover down the track is also an incentive, for any one with a medium term view, to buy PRC.

[temuk]

Why isn't Pike in the nzx 50?

it has value over twice some of the other so called top 50's.

[boysy]

The NZX 50 comprises the securities of the top 50 companies listed on the NZSX Market by free float market capitalisation. The free float is determined by excluding blocks of shares greater than 20% and blocks between 5% and 20%, which are considered strategic.

[upside_umop]

So excludes anyone with a holding over 5%?

[Lion]

OK, downside-up, I give up, what's PEG?

With regard to the transport chain, has anyone considered a conveyor belt system from the CPP to a rail siding, crossing the river? It's a lot lighter, cheaper, easier to build than a road or rail bridge over the Grey River.

[tim23]

PEG - Price earnings ratio divided by growth factor I think?

[temuk]

Thanks boysy.
NZO 31.1%
Gurarat 10.0%
Saurashtra 8.5%

no one else over 2.8%

Pike should still be in top 50.

[upside_umop]

Thats right Tim - PE/Growth factor.
Its useful when comparing two growth companies.
Ie. FPH (although poor results lately) has say 20% growth and PE around 30ish.
30/20=1.5. This number doesnt really mean too much.
You can then compare to another growth stock, maybe you rakon.
The lower the number, the cheaper it is in comparison.

Investopedia has a thing on it.

[chippy52]

PEG is one method to identify stocks considered to be of excellent value. A value between 0.75 & 1.0 is considered good value. PEG=PE multiple / EPS growth.

[dsurf]

It seems that i owe an appoligy to PRC management for my latest postings which were in no way meant to infer that they have done any wrong doing. If that is the impression i gave then i am truely sorry and take it all back. Sharetrader has received a complaint from a private member and on reading back i can see their point of view and apologise. MACDUNK

Mac Dunk don't let this get to you - this forum is for the whole spectrum of viewpoints and I agreed at the time with what you were saying but maybe it was a bit blunt - this forum needs all viewpoints and it would be boring / useless if everyone was in total agreement all the time

[duncan macgregor]

Mac Dunk don't let this get to you - this forum is for the whole spectrum of viewpoints and I agreed at the time with what you were saying but maybe it was a bit blunt - this forum needs all viewpoints and it would be boring / useless if everyone was in total agreement all the time Thanks for the support dsurf i never let anyone or anything get to me always call it as i see it. right or wrong you always know thats what i think at the time. Since you stirred me up i will plague you with my thoughts on the subject at this moment in time. PRC was never a buy with double port costs, to much to go wrong with to many people with the ability to hold the company to ransom.
This was reflected in the sp which went into a downtrend. When the sp started to get back to a dollar it was an indication that the smart money knew something that joe blow was unaware of, and was taking advantage of the blue eyed brigade.
At this point in time the smart money has the blue eyed brigade in stampede mode, trending the share up to a higher level than is warranted for this stage in the play. The question now is how high will it go before reality sets in, and it downtrends. This game means nothing to the brain dead who hold regardless of whatever happens, but to people who study market trends it brings a state of high alert. AGM on the ASX was in a similar position with lots of similarities to PRC. I bought at 59c the blue eyed brigade took it to $1-15 i got out at $1-05 made a few trades since the sp is now 68c. AGM will trend back up but look at the opportunity i would have missed by not understanding the market. For those with no knowledge of TA sell this share the moment it falls below the 30 day moving average. The buy point to buy is the 30 day moving average that is my alert points looking at what the smart money is up to, thats when i do my homework. The pedulum is swinging to high, and to fast guys which has nothing to do with how good or bad the share might be. Be carefull you dont get clobbered with it on the way back. Macdunk

[tim23]

Hold on - the blue eyed brigade (whoever they are?) sold to the smart money on the way up now they are buying on the way up - you have me confused!

[dsurf]

Thanks for the support dsurf i never let anyone or anything get to me always call it as i see it. right or wrong you always know thats what i think at the time. Since you stirred me up i will plague you with my thoughts on the subject at this moment in time. PRC was never a buy with double port costs, to much to go wrong with to many people with the ability to hold the company to ransom.
This was reflected in the sp which went into a downtrend. When the sp started to get back to a dollar it was an indication that the smart money knew something that joe blow was unaware of, and was taking advantage of the blue eyed brigade.
At this point in time the smart money has the blue eyed brigade in stampede mode, trending the share up to a higher level than is warranted for this stage in the play. The question now is how high will it go before reality sets in, and it downtrends. This game means nothing to the brain dead who hold regardless of whatever happens, but to people who study market trends it brings a state of high alert. AGM on the ASX was in a similar position with lots of similarities to PRC. I bought at 59c the blue eyed brigade took it to $1-15 i got out at $1-05 made a few trades since the sp is now 68c. AGM will trend back up but look at the opportunity i would have missed by not understanding the market. For those with no knowledge of TA sell this share the moment it falls below the 30 day moving average. The buy point to buy is the 30 day moving average that is my alert points looking at what the smart money is up to, thats when i do my homework. The pedulum is swinging to high, and to fast guys which has nothing to do with how good or bad the share might be. Be carefull you dont get clobbered with it on the way back. Macdunk

It is already on the way back and I totally agree with most of this - however I also suspect that alongside the traders are the kiwisaver type instos who love the sound of 20 years income, at prices way above prospectus etc etc. I am out & looking to re-enter around $1.10.

[Dr_Who]

LOL you clowns crack me up!

[duncan macgregor]

Hold on - the blue eyed brigade (whoever they are?) sold to the smart money on the way up now they are buying on the way up - you have me confused! TIM, what does the 23 stand for is it your IQ?. I know you know nothing about technical analysis so lets see if i can bring it down to your level of understanding. The thirty day moving average you will find if you log on to the direct broking site, gives a good indication of what the smart money is up to. Log in then get back and tell me how good a buy indicator that is at the buy end, not only for PRC but NZO and numerous others. The smart money are the people that know what really is going on before you do, learn to read the signs. The PRC sp started to rise from exactly the level of the thirty day moving average at 86c on a higher turnover. The SP is now to high even although it might go higher, i only warned to keep very close watch. Why dont you come to the sharetraders get together in Auckland Tim rather than snap away in the background saying nothing at all. I will even buy you a beer if you are old enough. Macdunk

[tim23]

Gee thanks - I'm aware of what the "smart money" is but you didn't read my reply, how can the blue eyed be silly enough to sell and then silly enough to buy, aren't they the same crowd, that was my point.

[the machine]

the sp is tracking 3 steps forward and one step back.

so next 3 moves are forward - we hope

the tunnel progress looks good and should be starting work on the extra infrastructure tunnels any day now, leaving the main drive to be worked towards the coal

M

[duncan macgregor]

Gee thanks - I'm aware of what the "smart money" is but you didn't read my reply, how can the blue eyed be silly enough to sell and then silly enough to buy, aren't they the same crowd, that was my point. Tim if you pay attention with an open mind you might learn something from this easy to predict share price drop which has nothing to do with fundamentals of the company. Its called market behaviour, which can be predicted in advance of the event. If you are the stick it under the bed brain dead type, this will mean nothing to you, the market will take advantage. You will end up buying or selling at the wrong time, you will under perform. The only profit to be made on this share are dividends in the distant future, or share price escalation. Let me give you another little prediction i cant be right all the time, must give you something to fire back to keep it interesting. The sp will bounce back up off the 30 day moving average once more before to long . Macdunk

[upside_umop]

Not sure if anyone has noticed, but there are two analyst reports on PRC website.
The latest being from Tolhurst in November. A good read.

The main thing that has developed since then is the transport chain, which they highlighted as an uncertainty and below their cost estimates

[tim23]

Duncan - I watch with interest, I'm a long term investor in this stock so the ma doesn't concern me too much.

[duncan macgregor]

Duncan - I watch with interest, I'm a long term investor in this stock so the ma doesn't concern me too much. TIM, Understanding market behaviour means that you only time your exit and entry points to suit whatever your investment style happens to be. When i told you to place PRC on carefull watch a few days ago it was timed to perfection. I then told you i expect it to bounce back when it hits the 30 day moving average still to come. I am a full time trader in another market, with a much higher volatility than PRC would ever have. Its not a trading share for me, a few dollars either way moves the price to much. It is much better to understand what is going on,rather than be blind to reality. This has nothing at all to do with the fundamentals of the company. Keep me honest give me heaps on a wrong call, the smart money will buy back if it gets below the 30 day moving average as you will find out and make another 6 or 7 pc. Let the profits run, but move your stop loss right up when the sp gets above where you think it should be. I think you will find it more fun playing the waves rather than sit soaking. Macdunk

[digger]

At 3-30 Aus a trade went through at NZ equilavant to NZ $1`-20. Fair size trade of 200 thousand. AUS seem to like PRC more than we do.

[sideline]

At 3-30 Aus a trade went through at NZ equilavant to NZ $1`-20. Fair size trade of 200 thousand. AUS seem to like PRC more than we do.

They know how to appreciate resource stocks.

[AMR]

At 3-30 Aus a trade went through at NZ equilavant to NZ $1`-20. Fair size trade of 200 thousand. AUS seem to like PRC more than we do.

Wouldn't they be better off buying on the NZX then? Seems like a decent arbitage opportunity.

[duncan macgregor]

Dont get to worked up thinking its a big trade it might only be a big mistake. Compare $400,000 against most small time mining ASX stocks is nothing at all. Look up AGM for instance in much the same position as PRC as far as production goes has about four or five times that volume every trading day. Someone might have placed a buy order without a cap and got caught out. Who knows it might be for real time will tell. Macdunk

[digger]

Dont get to worked up thinking its a big trade it might only be a big mistake. Compare $400,000 against most small time mining ASX stocks is nothing at all. Look up AGM for instance in much the same position as PRC as far as production goes has about four or five times that volume every trading day. Someone might have placed a buy order without a cap and got caught out. Who knows it might be for real time will tell. Macdunk

Agree DM,the seller will be soon shown to have made a mistake.

[digger]

Coal demand in China and India
· In 2005, China exported coal, while India imported, so the net import for the two together was close to zero.

· China is now importing coal as well, and the global coal price has doubled in the past year.

·
This is a small extract from a bigger story. Bermuda when is the coal price set. I thought it was about now?

[tim23]

Is it my imagine or not - when the price goes up its bad but when its goes down its cos I (DM) said it would?

You (DM) are as Sharne Warne said of John Bracewell in circa 2004 are "an idiot"'.

[bermuda]

Coal demand in China and India
· In 2005, China exported coal, while India imported, so the net import for the two together was close to zero.

· China is now importing coal as well, and the global coal price has doubled in the past year.

·
This is a small extract from a bigger story. Bermuda when is the coal price set. I thought it was about now?

Gidday Digger,
Pike has sure come on a treat eh?

THE PRICE AND DEMAND JUST KEEPS ON CLIMBING.

A lot of people dont understand. Did you know they turned down an offer from Korea for the whole project?
We dont need to sell until year 3 and man what a price then.

Price usually set in December.I bet $US125 plus

[digger]

Gidday Digger,
Pike has sure come on a treat eh?

THE PRICE AND DEMAND JUST KEEPS ON CLIMBING.

A lot of people dont understand. Did you know they turned down an offer from Korea for the whole project?
We dont need to sell until year 3 and man what a price then.

Price usually set in December.I bet $US125 plus

Thanks bermuda,i thought it was just before the new year for the new year.
No i did not know that Korea had made some offer for the project but it does not suprise me. Also agree that we should not sell until the project is a fully going concern. In fact that has always been my thinking since before the project even got started.
Now we will all be wishing we had bought more from the IPO or later in the 80 cent range. Think it is a desine fault that humans did not come equiped with inbuilt hindsight.
In the next few years this company will sure beat NZO and maybe nearly everyone else on the market.Unlike most other companies,if there is a fault it sure is put in the public arena. Imagine if investers had looked for faults in the finance companies like they do with NZO or PIKE.
Good on Pike for turning down early offers.

[LIO]

Hi Digger, why do you believe Pike will outdo NZO in the next few years ?

[tim23]

PS I see that AGM has a market cap 2.5 x Pikes so is it a fair comparison to compare volumes and given the share price is about .65 of Pikes theres far more shares on issue so x4 the volume is actually about right?

[digger]

Hi Digger, why do you believe Pike will outdo NZO in the next few years ?

Yes in the true since i believe PIKE will outdo NZO in the next few years. Pike is pure with only the coal to think about and as it comes into production it will be easy for brokers to measure its long term unbroked income and as a result it will attract interest from investers that like security. Hard cokeing coal is as much a depleting finite resource as oil but unlike oil it is easier to measure,and it is on land. Maybe in the long run oil is better but remember we are only considering the next few years and then sell the company as a going concern. If this should happen as i outlined i would say pike is the better deal. Also note NZO with 31% will get considerable benifit from such a sale but still i believe PIKE will do the better.Of coar-se all bets are off if NZO gets taken out before then.This is just my thoughts so do your own research before investing.
With both companies i will be just sitting this out and let the development happen.

[Billy Boy]

Hi Digger, why do you believe Pike will outdo NZO in the next few years ?

I agree with Digger and further to his thoughts :-
NZO is an primarily an exploration company. Therefore profits will go back into exploration and unless they make more oil strikes or pay a divvy, the SP will be slow to grow.
PRC will be paying a good divvy, NZO does not (yet).
I feel PRC will become more of a Take Over target in the near future.
The mad rush is on to replace oil as a fuel, but you must still be able to smelt metals
that will burn the new energy.
BB

[LIO]

Thank you Billy Boy and Digger. Some good points to ponder.

[dsurf]

Don't forget Kupe & an impending NZ gas shortage!

[boysy]

up against the market today and firm support on ASX as well

[Mr Tommy]

Pike has reached pit bottom at 1870m. Linear progress is now going to be slower as they excatvations get larger - need some room to swing the cat I guess.

[shane_m]

smart money would be buying Lyttelton Port Company as LPC will be gate keeper for both Solid Energy and Pike River Coal. People going through the LPC gates with coal to be charged. Also not affected by cost over runs at the mine.

[shane_m]

also with LPC no influence from TR or Dunk.

[the machine]

Pike has reached pit bottom at 1870m. Linear progress is now going to be slower as they excatvations get larger - need some room to swing the cat I guess.

thought pike were going to take over the tunnel drive at some point, leaving MD to excavate the pit bottom etc
M

[manxman]

thought pike were going to take over the tunnel drive at some point, leaving MD to excavate the pit bottom etc
M
Prospectus Clause 3.6.3 seems to say that Pike will do the pit bottom, and MD will keep heading for the coal. Either way there should be more resource underground and linear progress shouldn't drop off too much. Pike ordered the first roadheader for delivery in October so there must have been a plan to get their own team underground about this time.
There will be equipment commissioning and familiarization issues, getting multiple shift crews up to safety standard, but I guess that after Christmas, things will be busy.
The main ventilation shaft goes in soon as well, so its going to be a little hive down there. Interesting times.
Mx

[the machine]

thanks Mx

its going to be busy down there [actually up there]

looks loke solid average volume/trade going through

keep it going pike!

M

[upside_umop]

I dare say, that using your concept of the 30 day moving average, wouldnt have been pretty right now mac dunk.

You said, sell when the shareprice deviates above from 30 day ma and buy back when it hits it? yes?

The way i would interpret using the 30 day ma is to sell when it breaks the 30 day ma, (ie sp drops below ma) as this is one indicator the trendline has been broken.

You would buy into the share if it was to break above the ma from below.

Of course, this is a very simple analysis and its still pretty much a gamble since the share hasnt been trading long therefore its not known if its an accurate indicator.

Time will tell, but i would think people would be looking more bearish if it broke below the 30 day ma.

[bermuda]

I dare say, that using your concept of the 30 day moving average, wouldnt have been pretty right now mac dunk.

You said, sell when the shareprice deviates above from 30 day ma and buy back when it hits it? yes?

The way i would interpret using the 30 day ma is to sell when it breaks the 30 day ma, (ie sp drops below ma) as this is one indicator the trendline has been broken.

You would buy into the share if it was to break above the ma from below.

Of course, this is a very simple analysis and its still pretty much a gamble since the share hasnt been trading long therefore its not known if its an accurate indicator.

Time will tell, but i would think people would be looking more bearish if it broke below the 30 day ma.

Upside Down,

I never look at charts. I am not a trader.

I look at fundamentals and with PRC these are

1.There is a growing demand for coking coal

2.The price of coking coal is increasing

3.PRC coking coal is of superb quality.

4.Many Asian and Indian companies have been raiding Aussie coalers

5.There are two heavyweight Indian companys on the PRC register

6.Newcastle supply restrictions are getting worse and are costing Aussie coalers a lot of demurrage.

7.Asian customers want supply security. PRC offers that.

8.The IPO was launched at a terrible time for sentiment about PRC and NZO. Hence it was undervalued at the IPO.

9.PRC , once in operation, will be severely uprated and will be the subject of a takeover.

So I just sit and hold and watch the project come to fruition and watch the shareprice improve.

[upside_umop]

Bermuda, you pretty much put it in a nutshell.

That combined with a little TA works a treat. Also, like you said, sentiment too.

I bought in at IPO, didnt buy anymore as it was just a hold for me.

Fundamentals sure do look great, and if there was trendline break, i would be looking closely to see why...maybe the smart money knows some of the underlying fundamentals had changed? When your outside of the know, TA gives you a just a little know IMO. But again, not always correct is it.

Have you read the broker reports on the website?

[dsurf]

I am really enjoying the professional operating being undertaken by a brokerage on behalf of an unknown as yet party.

They always buy up ant leave a smidgeon on the buy, such as last night when trading at 115 /116.

this morning also bought up to - 118 & then left the queue - hoping that someone will sell into 115. If they do not within an hour - I expect a small trade to be done at 115 shortly to try & get the price down.

Good to see someone is keen - this is aggressive buying in a hurry - I assume it is so that it happens before the "coking coal price for 2008 " is released. Anyone have any idea when that might be.

p.s. macD - told you your emotion was getting in the way on this one.

[bermuda]

Bermuda, you pretty much put it in a nutshell.

That combined with a little TA works a treat. Also, like you said, sentiment too.

I bought in at IPO, didnt buy anymore as it was just a hold for me.

Fundamentals sure do look great, and if there was trendline break, i would be looking closely to see why...maybe the smart money knows some of the underlying fundamentals had changed? When your outside of the know, TA gives you a just a little know IMO. But again, not always correct is it.

Have you read the broker reports on the website?

Thanks,
The Tolhurst report was quite extensive.

As a general rule I find NZ mining/oil companies are poorly understood by NZ brokers and consequently a lot of opinions are way out of date and clouded by sentiment , the NZ tall poppy syndrome, and the NZ Barbeque factor.

Increasingly I am putting my dosh into Aussie Coal Bed Methane Companies which are going to take a huge leap forward especially with a LNG Plant being built at Gladstone. This virtually assures an international market at international prices.

Holding
LMPOA, NZO, PRC
BAS, BOW, PES, TEX, VPE, VPEO.
Cheers
Pity we couldnt get up to Aucland for their meeting eh.

[duncan macgregor]

I dare say, that using your concept of the 30 day moving average, wouldnt have been pretty right now mac dunk.

You said, sell when the shareprice deviates above from 30 day ma and buy back when it hits it? yes?

The way i would interpret using the 30 day ma is to sell when it breaks the 30 day ma, (ie sp drops below ma) as this is one indicator the trendline has been broken.

You would buy into the share if it was to break above the ma from below.

Of course, this is a very simple analysis and its still pretty much a gamble since the share hasnt been trading long therefore its not known if its an accurate indicator.

Time will tell, but i would think people would be looking more bearish if it broke below the 30 day ma. GOOD GAWD what have we got here?. The sp opened at a dollar went down to 80c in august which was well below the 30 day moving average which means you would not have touched it with a barge pole. It crossed above the 30 day moving average at 85c half way in sept which makes it a buy. it touched the 30 day moving average twice in nov which made it a close watch the moving average is rising fast its now $1-04. You would have bought them at 85c in sept for petes sake when the sp goes below the 30 day moving average you sell them. I only gave you the simplest TA buy and sell system on the planet and you still manage to get confused. Macdunk

[upside_umop]

ever heard of a 30 day moving average from 0 days trading? GOOD GAWD what have we got here?
MacDunk, your analysis of using the 30 day average is strange...thats all im saying.
Like i said, it was a buy and hold, and if i had sold out after a couple of days it would have been 90 cents. Not really worth the hassle. Didnt think it would go down too far.

You didnt act on the 30 ma being broken, and i dont think any trader in their right mind would have as there was no previous evidence to support this was an appropiate buying signal. As you would say, you would be going in blind (and relying on the fundamentals - where were great).

By the looks of the share now, you could act on the 30 day ma, but before...a no.

Your analysis of using it is still wrong though. You say buy when the sp drops to the ma, and sell when its above. Should be the opposite. Otherwise, your taking a guess on how high it will rise.

[duncan macgregor]

Nothing could be simpler surely. Nobody other than a gambler buys a share that has no record. The share went into a downtrend which means you dont buy. The share crossed the 30 day moving average on the way up in sept telling you the market considered it a buy at that level which was 85c. That is when you should have bought. The sp has not dropped below the 30 day moving average only touched it twice in nov which meant caution was required. When the sp goes up the moving average goes up its when the sp drops below the moving average you sell. You seem very confused with a really simple TA signal. I was silly enough to tell NITA that the 30 day moving average was a good buy and sell signal for both PRC and NZO which was and is much more profitable than a zombie buy and hold investor. Macdunk

[upside_umop]

TIM, Understanding market behaviour means that you only time your exit and entry points to suit whatever your investment style happens to be. When i told you to place PRC on carefull watch a few days ago it was timed to perfection. I then told you i expect it to bounce back when it hits the 30 day moving average still to come. I am a full time trader in another market, with a much higher volatility than PRC would ever have. Its not a trading share for me, a few dollars either way moves the price to much. It is much better to understand what is going on,rather than be blind to reality. This has nothing at all to do with the fundamentals of the company. Keep me honest give me heaps on a wrong call, the smart money will buy back if it gets below the 30 day moving average as you will find out and make another 6 or 7 pc. Let the profits run, but move your stop loss right up when the sp gets above where you think it should be. I think you will find it more fun playing the waves rather than sit soaking. Macdunk

This looks like the right quote.

Take notes of the points

*Expect it to bounce back when it hits the 30 day ma.

*Keep me honest....., the smart money will buy back if it gets below the 30 day ma.

*And something about a stop loss.

You seem to be telling two different stories according to the above quote and your last post.
I agree more with your last post to buy in when it breaks through the 30 ma from below..
I would take caution when it drops from above to close below the 30 ma.
I certainly dont agree with the quoted post though.
If you look back and read my posts, you will find i am not confused....and that i do agree using a 30 ma as an indication, but only a very simple one. I would not use it without it having proved accurate from past performance on a share. Ie. you wouldnt use it with a new share listed which you dont know it works for...so you would be going of fundamentals buying into it..which is what i had done.
Im young, i've learnt a bit since the IPO, still got a hell of a lot more to learn, but you could miss opportunities by always waiting back.
What would happen if you waited for the likes of RAK? PPL? You would have lost. FTX? You would have gained...short story, you win some, lose some..and so far im quite happy winning with this one.

What other forms of indicators do you use? Are you still with the 'super charts'? You should download free incrediblecharts and have a play...

[tim23]

Investors bought PRC at the float, not gamblers thats Sky City - you are confused!

[troyvdh]

..well said tim...some folk never get it...small horizons...like I said re the Opus IPO..about a third were traded...(most buyers were Ozys apparently).....gee what a huge...surprise...................and oh how we bitch and moan about NZ inc being lost overseas....some folk here need a longer attention span... think wealth rather than quick flick........

[upside_umop]

..well said tim...some folk never get it...small horizons...like I said re the Opus IPO..about a third were traded...(most buyers were Ozys apparently).....gee what a huge...surprise...................and oh how we bitch and moan about NZ inc being lost overseas....some folk here need a longer attention span... think wealth rather than quick flick........

Dont know about you, but i buy shares to make money. If i see fundamentals are turning sour with the stock starting to trend down, i will sell. Simple as that. Why take the loss when someone else will? Its each for their own sorry buddy.

Its all about opportunities, and all in all, im helping investment in NZ business, by helping provide a more efficent financial market, how ever minute my part is.

[the machine]

per prc photo album it shows the slurry pipeline footings having provision for 2 pipes -
curious why this is so?

M

[Billy Boy]

per prc photo album it shows the slurry pipeline footings having provision for 2 pipes -
curious why this is so?

M

Backup, in case of blockages
or extra capacity if needed.

[tim23]

Upside - so you do take a loss from time to time based on your reply?

[upside_umop]

yes tim123456789, i have taken a loss from time to time, i would say you are very good if you have never taken a loss. i do however, try to minimize losses and have only really learnt how to by taking an interest in the likes of Phaedrus with his system. not sure if im ready to fork out the 1500 dollars for metastock though! heres a good quote, was sent in some trading diary email this morning....

"If I were walking along a railway track and saw an express train coming at me at sixty miles an hour, I would be a damned fool not to get off the track and let the train go by. After it had passed, I could always get back on the track again, if I desired."

~ Jesse Livermore: How To Trade In Stocks (1940)

[tim23]

Fair enough - I guess I'm thinking of investors who bought PRC at the floast then sold below float price at a loss and then see the price 12% above original price - what was the point in selling at a loss?

[upside_umop]

Yeah i know what your saying, if a 5% stop loss was implemented, then they would have sold out at say 95cents. Could have brought back in later at maybe a lower price using an indicator.

But as i have said to MacDunk before, it would be a little silly to do this, as there is no past trading history on the stock, and therefore hard to tell its volatility and whether what indicators it will react to. Only past performance can show what indicators can work for a share, and not every share will go by the 30 day moving average (although prc coal sort of has so far) or other such indicators.

Basically, i dont think you can use TA on an IPO. Will have to follow it up with Phaedrus when he gets back, but to me it doesnt make sense. You would only buy on IPO if you were looking for a long term hold/stag or even if it tickled your fancy for some reason.

I bought in at IPO, thinking it was good (more long term)...gritted my teeth, mainly because i didnt know what i know now (still learning mind you - lots). But gritting the teeth has paid off so far. Although this is long term, if things were to go a little sour, and chart wasnt to look so good, i would pull out and wait for things to settle and look for a re-entry, even though its long term.

[duncan macgregor]

Fair enough - I guess I'm thinking of investors who bought PRC at the floast then sold below float price at a loss and then see the price 12% above original price - what was the point in selling at a loss? TIM, Its a gamble to buy into a share with no past record or inside information. Some times it works some times it dousnt.
The share went straight into a downtrend, the gamble obviously didnt work. The first TA buy signal was when the sp broke the thirty day moving average on the way up at 86c. That was not a gamble, the market was telling you the share was oversold. Your feelings about the company good or bad have no bearing on on the market price, so it pays to listen to what the market is saying. I did think it was oversold at 90c which was proved wrong .
When the sp swings to high the other way, which is normal, you merely raise your stop loss level to protect your profits. If the company is on a long slow uptrend you give it room to move. Its all very simple really, and much less risky as buying and holding regardless or comitting financial suicide by averaging down to make your small loss look better by creating a bigger loss. When you teach yourself to read the market you will find it far more rewarding than trying to be right all the time analizing company fundamentals. Macdunk

[AMR]

I am not going to buy into any IPO ever again unless the general market is extremely bullish, statistically a lot of IPOs fall below the issue price for a while. A 30 day average fits PRC pretty well, the dips tend to bounce off the MA if it is properly fitted.

[duncan macgregor]

I am not going to buy into any IPO ever again unless the general market is extremely bullish, statistically a lot of IPOs fall below the issue price for a while. A 30 day average fits PRC pretty well, the dips tend to bounce off the MA if it is properly fitted. Run the 30 day moving average over your NZO as a buy signal it works a treat on that one as well. Incidently AGM a share i compare to PRC being a start up miner about to produce shot up nearly 30% today on take over offers. PRC might follow suit so keep your eyes open on market behaviour leading up to production. Macdunk

[AMR]

The close at 1.08 confirmed a double top on very light volume (possibly a false breakout?). Not too worried at the moment as it is still far above the trendline. There were also divergences on Stochastics and RSI last wednesday. Time to tighten stops!

[Scuffer]

Well boys Scuffer will be joining the ranks when a buying opportunity arises probably next year, thanks for listening to me and thanks for not listening to me, Scuffer can be a fickle boy only because of the fickle finger of fate, its had me before it can be painful. I am confident I will kick this can.

[Xerof]

some reading for fellow Pikers......

toot toot

http://www.pike.co.nz/reports/analyst-reports

[manxman]

ASX currently

PRC Last 0.930
Bid 0.945
Offer 1.030
Someone - somewhere - knows something.

[Sideshow Bob]

some reading for fellow Pikers......

toot toot

http://www.pike.co.nz/reports/analyst-reports

McDouall Stuart floated it, so might be slightly more sceptical on their's.

[the machine]

ASX currently

PRC Last 0.930
Bid 0.945
Offer 1.030
Someone - somewhere - knows something.

imo sellers are no longer quitting stock and any sales @.93 was a knee jerk reaction to events of last few days

M

[bermuda]

JEEPERS CREEPERS .

This is an outstanding stock.

[bermuda]

JEEPERS CREEPERS .

This is an outstanding stock.

Latest Aussie Fin Review has some interesting clips.

"There is an element of almost panic by our overseas customers to get the tonnes they need"...such is the logistical coal jam on the Aussie Eastern seaboard.

"Goldman Sachs is predicting hard coking coal prices will rise more than 50% to $US150 a tonne on April 1 and stay there for two years"

PRC will not only enjoy these prices but the surety of supply will also weigh heavily in their favour.

Watch out for a top performance in 2008.

[AMR]

Let's hope the dollar tanks in time for the first shipment so we can fully take advantage of these nice prices.

What are your thoughts on Pike's labour situation? Would it be possible for them to get some cheap and skilled Chinese miners from the mainland?

[duncan macgregor]

Let's hope the dollar tanks in time for the first shipment so we can fully take advantage of these nice prices.

What are your thoughts on Pike's labour situation? Would it be possible for them to get some cheap and skilled Chinese miners from the mainland? Why ever not. All your factories are closing down being relocated over there. Air NZ buy planes manufactured overseas get the office work done in FIJI and the maintanance done in china The only thing NZ about it is likely to be the air hostess. Australia pay qualified miners double NZ rates, so your chinese miners will only use PRC as a stepping stone to get into AUSSIE. NZ is destined to become the retirement holiday home for overseas visitors, so i would suggest the only worth while investment opportunities will be retirement villages. All your children and grandchildren will head overseas, so why not load up with cheap labour from where ever. Hope you had a good christmas AMR look forward to our next meeting. Macdunk

[the machine]

next tunnel update should show some decent progress with both the drive forward and pit bottom.

M

[Scuffer]

Why ever not. All your factories are closing down being relocated over there. Air NZ buy planes manufactured overseas get the office work done in FIJI and the maintanance done in china The only thing NZ about it is likely to be the air hostess. Australia pay qualified miners double NZ rates, so your chinese miners will only use PRC as a stepping stone to get into AUSSIE. NZ is destined to become the retirement holiday home for overseas visitors, so i would suggest the only worth while investment opportunities will be retirement villages. All your children and grandchildren will head overseas, so why not load up with cheap labour from where ever. Hope you had a good christmas AMR look forward to our next meeting. Macdunk

Bang on Dunc, I couldn't agree more we are a country in dire straits we are moving from a chronic shortage of skilled workers to a critical shortage of skilled workers once we go into a critical shortage it will be just a matter of time before the whole economy comes crashing down while the government sit happily oblivious to the sucker punch that comes their way.Government seem to think they can just train a lot of apprentices and that will solve the problem I and I suspect you, also know that a tradesman just out of his time has just started to learn his trade its the next five years after an apprenticeship when a tradesman comes of age before that most are still trying to figure the whole thing out and decide whether they have made the right career choice.
So good luck to PRC but I anticipate major problems in this area for the company as with any company in NZ finding good skilled workers is hard enough, keeping them is even harder,we have the highest numbers of people leaving for Oz since 1988.Its time someone set the alarm off and we started to wake up you can't train a lot of apprentices and think you have the problem solved when all the experienced tradesmen are leaving, the experience is what we need you can't train that, its what you pay for in the long run one way or another, I just hope the country doesn't end up really paying for it.

[JBmurc]

Bang on Dunc, I couldn't agree more we are a country in dire straits we are moving from a chronic shortage of skilled workers to a critical shortage of skilled workers once we go into a critical shortage it will be just a matter of time before the whole economy comes crashing down while the government sit happily oblivious to the sucker punch that comes their way.Government seem to think they can just train a lot of apprentices and that will solve the problem I and I suspect you, also know that a tradesman just out of his time has just started to learn his trade its the next five years after an apprenticeship when a tradesman comes of age before that most are still trying to figure the whole thing out and decide whether they have made the right career choice.
So good luck to PRC but I anticipate major problems in this area for the company as with any company in NZ finding good skilled workers is hard enough, keeping them is even harder,we have the highest numbers of people leaving for Oz since 1988.Its time someone set the alarm off and we started to wake up you can't train a lot of apprentices and think you have the problem solved when all the experienced tradesmen are leaving, the experience is what we need you can't train that, its what you pay for in the long run one way or another, I just hope the country doesn't end up really paying for it.



-too right the Central otago fruit growers have massive skill shortages atm with are idot goverment imposing more restrictions on temp workers from overseas -alot of produce will be wasted because of new PC laws

[tim23]

The wages on offer will be far better than fruit picking which is seasonal and typically poorly paid - growers need to make their jobs more attractive so I don't see a labour problem for PRC.

[duncan macgregor]

The wages on offer will be far better than fruit picking which is seasonal and typically poorly paid - growers need to make their jobs more attractive so I don't see a labour problem for PRC. Tim Have a look at qualified miners wages which is a highly professional occupation then compare Australia to here. You speak of pick and shovel labourers in the same category as fruit pickers as though that is all that is required. Mining in NZ is at a dangerous level with not enough qualified skilled miners who earn over $3000 a week in Australia so why would they work in a cold wet west coast area for less?. They will have great problems attracting skilled workers to come to NZ you dont have enough to go round as it is in AUSTRALIA or NZ. Macdunk

[tim23]

Some people choose to live in NZ; my point is that PRC will be offering an attractive package that will attract local labour who will move to better paid jobs - quite simple, a lot of the jobs will be semi-skilled so no issue in my opinion.

[Mike.Gayner]

I wouldn't waste your breath trying to change the mind of people who carry anti-Labour government sentiment to be honest, Tim. I dont see the labour market being too big of a hurdle.

[duncan macgregor]

I wouldn't waste your breath trying to change the mind of people who carry anti-Labour government sentiment to be honest, Tim. I dont see the labour market being too big of a hurdle. MIKE, If you want to know my political view point i can give you it in one hit. I wouldnt vote for any of them it only encourages them. Back to the point in question regardless if you like it or not the facts are.
1,miners are highly qualified tradesmen requiring years of training the pick and shovel days are over.
2, They can earn $3000 a week in AUSTRALIA.
3, NZ has a dangerous ratio of qualified to unqualified right now.
4, Australia has a shortage of qualified miners right now.
That is the facts you can bulldust all you like about politics throw as many red herrings about but in the end all that counts is the facts. It has been suggested to bring in cheap labour from overseas but all that would only end up being a stepping stone to AUSSIE. Macdunk

[Mike.Gayner]

You talk a lot about facts, but you present no evidence to support your claims.
1. It's not true that miners are 'highly qualified' with 'years of training'. There are certain trades within mining for which this is true, but most miners have minimal training.
2. My sister's fiance is a qualified miner in Australia, and he earns nothing near $3,000 per week. While he earns more there than he ever would here, he happily admits he was sucked into the same hype as everyone else at his mine, and is dissapointed with the level of pay offered.
3. I would like to see a source supporting this.
4. This is, of course true. There's a shortage of qualified anythings everywhere currently.

[duncan macgregor]

MIKE, I have a friend who is in a mine management position in Australia i go by what he says which is easy to verify. APPLY FOR A BLOODY JOB ITS THAT SIMPLE. Send an E-mail to a few companies asking about wages and conditions as you are interested in going over to work. Dont bury your head in the sand saying this is right and that is wrong based on total ignorance of the subject then front up saying its because we dont like the govt or such like rubbish. Macdunk

[blockhead]

Tim Have a look at qualified miners wages which is a highly professional occupation then compare Australia to here. You speak of pick and shovel labourers in the same category as fruit pickers as though that is all that is required. Mining in NZ is at a dangerous level with not enough qualified skilled miners who earn over $3000 a week in Australia so why would they work in a cold wet west coast area for less?. They will have great problems attracting skilled workers to come to NZ you dont have enough to go round as it is in AUSTRALIA or NZ. Macdunk


Not sure if you ever lived on the Coast McDunk, I have, it may be wet from time to time but it is not often cold. There are many worse places to live. Don't run the place down, it may not suit you but a lot would love it.

[duncan macgregor]

Not sure if you ever lived on the Coast McDunk, I have, it may be wet from time to time but it is not often cold. There are many worse places to live. Don't run the place down, it may not suit you but a lot would love it. Not running anything down only saying it as it is. There are a lot colder wetter places in Scotland with the natives of the land convinced its the best place on earth. They will be competing in the labour market for skilled workers who can be in another country for less than a days wages. Macdunk

[Crypto Crude]

mike gayner-I wouldn't waste your breath trying to change the mind of people who carry anti-Labour government sentiment to be honest, Tim. I dont see the labour market being too big of a hurdle.

MGayner,
NZ has the tightest labour market in the OECD, and probably in the World...
Unemployment is near all time lows, and is between 3-4% (off memory)...
immigrants are not filling skilled jobs... They come, some as refugees and work labour, manual entry level jobs.....
We train our own and send the skilled ones oversea's... In a few years (unless I get a great opportunity working for a NZ company, then I will send myself oversea's also).... Probably to Aus for a year and then to China...
You try applying for a job or citizenship in the States...
Its near impossible unless you have a degree with a guaranteed job, or $1 million US in Cash you can become a citizen (so I have been told)...
.... Citizenship in NZ is as simple as needing a boat to get here...
...
Labour concerns are an issue and the Labour party has recently changed the way it proccesses its student loans with zero percent interest while you stay in NZ, only to incourage graduated students to stay...
this can save thousands a year on interest charges, because currently there is a mass exodus....
Pike on the other hand will be highly profitable, increased labour costs arenot such a big deal... Coal price increases will outweigh increased labour costs anyway...
:cool:
.^sc

[manxman]

Not sure if you ever lived on the Coast McDunk, I have, it may be wet from time to time but it is not often cold.

Have a browse through the PRC photo gallery. Some lovely snow scenes.
But contrast that with the mind blowing aridity of a Western Australian mining town, and you might well choose the land of the long white bait.

To get their pick of miners on the coast, PRC need to be better than Solid Energy. That's all.

Mx

[Dr_Who]

You talk a lot about facts, but you present no evidence to support your claims.
1. It's not true that miners are 'highly qualified' with 'years of training'. There are certain trades within mining for which this is true, but most miners have minimal training.
2. My sister's fiance is a qualified miner in Australia, and he earns nothing near $3,000 per week. While he earns more there than he ever would here, he happily admits he was sucked into the same hype as everyone else at his mine, and is dissapointed with the level of pay offered.
3. I would like to see a source supporting this.
4. This is, of course true. There's a shortage of qualified anythings everywhere currently.


McDunk was saying the same thing when PRC sp was at 85 cents.. LOL.

[Scuffer]

I can only speak about what I know and I've got a mate who is making good money in Oz in a mine and he flies back to NZ every six weeks his missus told me she has $4000 in the bank every fortnight so he must be on more than that as he has living expenses and flights to pay for, don't bother banging ya drum Dunc ostriches are deaf with their heads buried in the sand.

[Billy Boy]

Manxman, your onto it.
Natural quality of life is much, much better than artificial quantity.
Shhhh Blocky.... else all them Strucken Aufailalians will come pooring
over to the West Coast just to get away from the heat, flys, snakes,
boardom, bad beer and rotten meat.
And that will stuff the Whitebait, Hunting, Fishing, Coastal Foods,
Monteiths, Hot pools, Skiing, Tramping, Gold Panning, Jet Boating,
River Surfing, Canoeing and Duck Shooting, etc, etc. on the Coast.
After all Blocky, its why we live where we do rather than Auckland.
Cheers BB

[zorba]

.
BB,

Great post ..... spot on.

Reading through the McDouall Stuart appraisal of PRC, looks to be a very thorough and detailed analysis ...... if Pike can deliver and ship 1m tons coking coal as per plan, without any st.uff-ups or major world market downturns, then seems to me the SP will be pushing past $3, based on reasonable P/E ratios.

Have therefore made a modest long term investment into PRC.

Main Pike exposure is still through significant NZO holding.
.

Best wishes for a prosperous new year to all Sharetraders !!!!

[manxman]

PRC up 8c on ASX today. WTF.
Are we about to see some serious escalation in coal price contracts?

Mx

[zorba]

.
Manxman,

I was wondering exactly the same thoughts ...... and volume was higher on the ASX than the NZX ...... something's on the go.
.

[temuk]

Have been checking the Pike web site
but no update on tunnel progress since 17 dec.


I hope the rabbits are still burrowing and the office girl is
on holiday!

[the machine]

great day on the asx today and now sp 50% above those dark subprime days.

next tuesday after holidays there should be a tunnel update - hopefully showing very good progress.

M

[zorba]

.
BHP .... hoping to win a rise in coking coal prices to 145 dollars a tonne for the year starting April 1, 2008 !!!!

Check out details in:

http://metalsplace.com/news/?a=16426

.
.

Go Pike Coking Coal .... GO PRC !!!!!!!
.

[manxman]

.
BHP .... hoping to win a rise in coking coal prices to 145 dollars a tonne for the year starting April 1, 2008 !!!!

Check out details in:

http://metalsplace.com/news/?a=16426



That article is dated 7 December and quotes Gerard McClosky as predicting "last month" i.e. November 2007 that BHP would be aiming for $145/tonne.

There must be some firming of the situation to have set the market off on Friday. Interesting times.

Mx

[Robomo]

.
BHP .... hoping to win a rise in coking coal prices to 145 dollars a tonne for the year starting April 1, 2008 !!!!

Check out details in:

http://metalsplace.com/news/?a=16426

.
.

Go Pike Coking Coal .... GO PRC !!!!!!!
.
Metalsplace is not the only journal to predict high premium coking coal prices. Check this report from 20 December from Canada for $US140.

http://nbbusinessjournal.canadaeast.com/canadaeast/article/162848

[RossT]

Here's an article i was reading on Bloomberg about the Chineese-Australian raw material situation. Has some pretty amazing numbers. Apparently on July 2, about 79 ships were waiting to enter Newcastles port due to congestion. Not HCC specific but an interesting read all the same. Frankly if PRC Sp doesn't take off in 08 I'll be amazed!

http://www.bloomberg.com/apps/news?pid=20601109&sid=aO_ev6uyrctg&refer=home

[bermuda]

Here's an article i was reading on Bloomberg about the Chineese-Australian raw material situation. Has some pretty amazing numbers. Apparently on July 2, about 79 ships were waiting to enter Newcastles port due to congestion. Not HCC specific but an interesting read all the same. Frankly if PRC Sp doesn't take off in 08 I'll be amazed!

http://www.bloomberg.com/apps/news?pid=20601109&sid=aO_ev6uyrctg&refer=home

That's exactly right and that is why PRC will fly.

Supply security..that's what these coking coal customers require.

The Aussie coalers are facing huge demurrage bills and large increases in costs and these together with the falling $US are paving the way for $US150 per tonne.

[Billy Boy]

OK OK OK all you positive rampers. Trying top talk up SP before
the pending CRASH coz of all them negitive things. And trying to
take all them poor MUMs & DADs to the cleaners.
GO go go all you's Mcdunkers & Mcdunkesses, ramp things down.
Coz I have just had my third quarterly payout and I got some
spare cash. And I wanna throw it all away on PRC shares.
Therefore anybody needs to get ride of a few. Ring my broker
and I'll you give say... about.... 80 - 85 cents a share right now.
No questions asked, yes I know I am paying to much but I am
a generous Old Aged, not quite, Pensioner.

[the machine]

looking for a tunnel update tomorrow, otherwise how can it be justified spending $5m+ since 24th and no dirt dug out

M

[Robomo]

BillyBoy won't be pleased to see the following just published on www.nasdaq.com

UPDATE: Rio Tinto To Buy Three Ships To Carry Iron Ore
By Steve Goldstein

LONDON (Dow Jones) -- Rio Tinto said Monday it was buying three ships to lug iron ore from Western Australia to China and other locations as demand for the raw ingredient to produce steel heats up.

Rio Tinto (RTP) said it's buying three ships for $315 million, and has reserved rights on another two vessels.

Each will be able to carry 250,000 metric tons of iron ore. The vessels are being built by Namura Shipyards in Japan and will be delivered from late 2012.

The mining giant wants to triple its iron-ore production per year from Australia and Guinea to over 600 million metric tons per year.

"Competitive freight and freight management are important levers in our growth plans. These very large ore carriers will assist us in continuing to provide our customers with better delivery options well into the future while locking in low, long term freight rates for the benefit of our shareholders," said Sam Walsh, chief executive of Rio Tinto Iron Ore.

M&A also in play

Iron ore is a reason that BHP Billiton (BHP) has cited for trying to buy the London-based metals group.

If BHP were successful in its takeover offer for Rio Tinto -- and if competition authorities in Europe and elsewhere signed off -- the combined firm would control about a third of the world's iron ore production, leaving Brazil's Vale (RIO) as the only other serious competitor.

BHP has until Feb. 6 to either announce a firm intention to make an offer for Rio Tinto or to say it doesn't plan to make an offer. Rio Tinto has said BHP's proposal to swap three of its shares for every Rio Tinto share would undervalue it.

Separately, Rio Tinto is interested in buying Xemplar , a Canadian uranium explorer with operations in Namibia, according to a report in The Sunday Express. Rio wants an independent verification of a Xemplar site in Namibia before bidding, the newspaper reported.

The group has a market capitalization of C$737 million ($742 million), but is worth close to $2 billion, according to Marc Elliott, an analyst at Fairfax in London.

Besides Rio, France's Areva or a Chinese firm may have interest in buying Xemplar, Elliott added.

In Monday trading, Rio Tinto shares slipped 0.7%.


(END) Dow Jones Newswires
01-07-080726ET
Copyright (c) 2008 Dow Jones & Company, Inc.

Despite what BB thinks, if you want to make more iron then you need more ore and more coking coal. If there are huge hold-ups at Newcastle then other more dependable suppliers will benefit. Simple. All good for PRC from an economic point of view.

From a practical point of view the tunnelling update will certainly be of interest.

[Dr_Who]

Just the Indian market alone will be more than happy to take all of PRC's coals. :) It doesnt take a mad scientist to figure out why the Indians bought a chunk of shareholding in PRC.

While people like like BB and Mcdunk talk crap, people like us are laughing all the way to the bank.... LOL

[AMR]

The tunnelling update is out. They spent most of the time holidaying:cool:.

[Steve]

The tunnelling update is out. They spent most of the time holidaying:cool:.

As long as they are still on track...:)

[tim23]

Is Billy Boy Duncans father?

[digger]

The tunnelling update is out. They spent most of the time holidaying:cool:.

Not so bad.They seem to have gone off on some predetermined paths. They are starting to build that whatever you call it. Good news really only 400 metres to go. I am picking an option issue at first coal.
Last year i met Peter Whithall at waihi where he was attending a mining conference. We had lunch together. At that time Peter said 58dollars a ton was needed to break even on the then current rising expenses. Ever the optomist i said it would be over a hundered when we started to produce. He said well lets hope you are correct but did not give it much hope. Now by production it is looking like 150 is just around the corner.
Is anyone else old enought to remember how commoties were always looked down on and we were forever told that if NZ had any future it would come by added value. Today it is all turned around. We do not have much hope against India and China wage structure to flood the world market in added value,but their success in doing so is draining the world of raw materials. It is the super commoddies cycle now.

[the machine]

looking at the tunnel map it shows progress 1909.8m w/s dec 17 and 10m progress to w/s dec 31 for a total 1933.8m @ jan 7.

something does not add up or did we get 14m for free

M

[zorba]

.

Digger you're onto it, ironic turn around as you putzit.

But, the hot commodities super cycle this next year does depend on those fat Yank bankers having not stuffed the world economy with their sub-prime rip off artistry, added and abetted by toady regulators and even more toady rating agencies.

Check out this cra.p from Moody's ..... they are at a complete loss as to how to track and determine risk ..... what a cop out, what self serving cra.p:

http://www.nzherald.co.nz/section/3/story.cfm?c_id=3&objectid=10485673

The American banking and financial system is clearly stu.ffed and very clearly is not to be trusted !!!
.

Machine,

The tunnel is branching out now in different directions as they construct the "pit-bottom" areas ...... where the coal will be collected before its fumed down the steel slurry pipe to the coal prep plant.
.

[Billy Boy]

Zorba, Tks for that link. Moody's ???? you are right.

Digger, Your thoughts on a rights issue at first coal are interesting.
Have you any guesses/thoughts on type and cost ??
I have been accumulating PRC best I can since the bottom and have not
giving any real thought to a rights issue.
Cheers BB

[digger]

Zorba, Tks for that link. Moody's ???? you are right.

Digger, Your thoughts on a rights issue at first coal are interesting.
Have you any guesses/thoughts on type and cost ??
I have been accumulating PRC best I can since the bottom and have not
giving any real thought to a rights issue.
Cheers BB

Hey BB i said an option issue not a rights issue. A rights is something i have not thought too much about. In the few seconds it took to type the last sencence it occurred to me that NZO has some sort of predetermined 25 million already in place when the value was lower than now,so they would correctly want to take this up if possible,which would preceed a general rights issue.Apart from that your guess is as good as mine.

[Billy Boy]

Tks Digger
Options is what I meant to say.
Will be very interesting over the next few months with PRC.
I might hold some money back with the wait and watch approach.
Cash earns 7.75% on call so wont lose too much. !!!
Cheers BB

[AMR]

Wait and watch from me as well. I currently hold pike, but I'm waiting until they reach the coalface. They are currently going through the most unknown geography at the moment (since they couldn't drill down deep enough to find out).

As long as China and India don't tank, then PRC will be a nice little investment that I don't mind holding longer-term. I came up with 15% dividend yield at IPO, it's probably a bit more now with the rise in coal prices.

[Billy Boy]

I hear on the news that Iraq is about to close oil field development tenders at the
end of this month. They have the third biggest oil reserves in the world, so
this could bring about a stabilizing effect by the end of the year, maybe price
could go down a bit. That would all go well for the steel industry in China & India.
And lessons their chance of "tanking". By then PRC should be getting near top gear.
I have a very good feeling about PRC .
BB
Oh... and time for the Yanks to get their S**t togeather.
Politics allowing. !!!! There & Iraq
____________________________
Tim23... Got any PRC shares, I'll take them off your hands for... say 90c,
I,ll even cover the brokerage. Or are U Mcdunks Uncle !!! (Joking)
Cheers

[tim23]

Yes I have PRC shares but I can sell them for a market price not to a thief.

I thought there was mention of a bonus issue at some stage for PRC; anyone else pick that up?

[Bilo]

Yes I have PRC shares but I can sell them for a market price not to a thief.

I thought there was mention of a bonus issue at some stage for PRC; anyone else pick that up?

Refer to The PRC Prospectus "Section 2.5 Bonus options"
Currently contemplating making an issue of bonus options approx. six months after the allotment date...up to directors......pro-rata entitlement..one bonus option for every four shares held..likely...on same terms as the Options...$1.30 30 June 2009....:)

[bermuda]

Refer to The PRC Prospectus "Section 2.5 Bonus options"
Currently contemplating making an issue of bonus options approx. six months after the allotment date...up to directors......pro-rata entitlement..one bonus option for every four shares held..likely...on same terms as the Options...$1.30 30 June 2009....:)

I will be taking up the maximum.!!!

[manxman]

I will be taking up the maximum.!!!

If they are bonus options, then they just arrive don't they? You don't have to apply for them. You don't get a choice about the number.

We should get to hear one way or another around the end of the month.

If the options are exercised in June '09, what would the money be used for? Cash flows should be well positive by then.

Mx

[Steve]

If the options are exercised in June '09, what would the money be used for? Cash flows should be well positive by then.
Mx

Further exploration of surronding area? Debt Reduction? More plant to increase capacity?

[manxman]

20 million Pike shares sold in Sydney on falling market this morning. When in doubt - PANIC

Mx

[Bilo]

20M PRC change hands on the ASX...AUD90c

[Dr_Who]

Who sold their holdings?

[blockhead]

20M PRC change hands on the ASX...AUD90c


Havent checked the requirements but does that constitute a SSH notice ?

Maybe not, good wee parcel to have though come June when they are $1.50

[bermuda]

Havent checked the requirements but does that constitute a SSH notice ?

Maybe not, good wee parcel to have though come June when they are $1.50


Probably an astute investor getting in before BHP announce the new coking coal price increase to.........

My pick...$US148 per tonne.

And the new terminal at Darylymple aint due to be completed for about 4 years so a secure and reliable supply of Pike coal ex Lyttelton will seem like a dream come true for many in the game.

[zac]

Perhaps someone had a call from his banker. The good news is someone else paid 90c for the 20m (or took them in lieu of payment). Picked up a few myself on the ASX for 91c; looks to be a good deal, but in these uncertain times who knows?.

[Dr_Who]

looks to be a good deal, but in these uncertain times who knows?.

I am in the same boat, wanting to pick up some more shares, but in these uncertain times I have cold fingers and would like to wait.

[RossT]

New Tunnel update is on the website. 1959m in, and hawera fault marked on the tunnel chart. Tunnelling to stop temporarily on the 17th for a 600m conveyor extension. If I had a piggy bank to raid, I'd be more than happy to buy more at the current price.

[wk6332]

Quote:
Originally Posted by Bilo
20M PRC change hands on the ASX...AUD90c


Havent checked the requirements but does that constitute a SSH notice ?


Gujarat NRE coke limited has transfered its shareholding in Pike river Coal to its wholly owned Australian subsidiary Gujara NRE Limited at NZ $20,700,000.

So no change?

[Bilo]

Quote:
Originally Posted by Bilo
20M PRC change hands on the ASX...AUD90c


Havent checked the requirements but does that constitute a SSH notice ?


Gujarat NRE coke limited has transfered its shareholding in Pike river Coal to its wholly owned Australian subsidiary Gujara NRE Limited at NZ $20,700,000.

So no change?

20M is nearly 10pc. Should require 2 notices if 5pc is the hurdle. True to form tho we could wait a while for any notice...

[wk6332]

Notice posted on ASX PRC

[Dr_Who]

Quote:
Originally Posted by Bilo
20M PRC change hands on the ASX...AUD90c


Havent checked the requirements but does that constitute a SSH notice ?


Gujarat NRE coke limited has transfered its shareholding in Pike river Coal to its wholly owned Australian subsidiary Gujara NRE Limited at NZ $20,700,000.

So no change?

If it is just a simple transfer why the need to do a crossing on the market? One can just fill in a transfer form to transfer shares.

[temuk]

looking at the tunnel map it shows progress 1909.8m w/s dec 17 and 10m progress to w/s dec 31 for a total 1933.8m @ jan 7.

something does not add up or did we get 14m for free

M

Things hadn't changed so e-mailed them last night,
they e-mailed me back 1st thing this morning and web site
has now been fixed.

[Steve]

If it is just a simple transfer why the need to do a crossing on the market? One can just fill in a transfer form to transfer shares.

It may have been a recorded off-market transaction? It wouldn't be the first time that an off-market transaction has been recorded, although I'm unsure why some are?

[Dr_Who]

It may have been a recorded off-market transaction? It wouldn't be the first time that an off-market transaction has been recorded, although I'm unsure why some are?

Maybe someone can answer that question for us. Why put a trade through the market when it is only a simple transfer of shares to the same owner?

[dsurf]

Maybe someone can answer that question for us. Why put a trade through the market when it is only a simple transfer of shares to the same owner?

It's not the same owner - the Ausi company is a separate entity with possibly different shareholders.

[tim23]

I assumed any off market transfer would be included in the daily volume?

[winner69]

Maybe someone can answer that question for us. Why put a trade through the market when it is only a simple transfer of shares to the same owner?

Different legal entities in different countries prob the reason .... esp as they seem to have attached a value to them ..... suggests that there could be gains / losses on either side ... so they had to go the market process

Only a thought

Ask them

[BWR]

NZ$100 Million Equity and Senior Debt Package for Pike River Mine Development

A NZ$100 million new equity and senior debt package is announced today by Pike River Coal Limited (Pike River) to complete development of its West Coast premium hard coking coal mine and support operations until steady state production from hydro monitor mining is achieved.

Pike River Managing Director Mr Ward said “This funding package, the arrival of the tunnel at the pit bottom area and the long term transport contract with Solid Energy to transport coal to Lyttelton for export have significantly de-risked and added value to the Pike River project in the last two months ”.

The equity element of the funding package will comprise an underwritten Renounceable Rights Issue to existing shareholders and noteholders to raise NZ$60 million. In addition, shareholders will be invited to approve a Senior Debt Issue of US$30 million (approximately NZ$40 million) of convertible bonds to Liberty Harbor LLC, an investment fund which is part of Goldman Sachs Asset Management with offices in Singapore.

The Renounceable Rights Issue will be pro rata and comprise one new share for consideration of NZ$1.00 for every 3.561 Pike River shares held (existing note holders participating on an as-converted basis) on the record date at close of business on Friday 30 January 2008. McDouall Stuart Securities Limited is the Lead Manager of the issue. The issue will be fully underwritten by McDouall Stuart Group Limited, and the company’s three principal shareholders - New Zealand Oil & Gas Limited (NZOG), Gujarat NRE Limited (a wholly owned Gujarat NRE Coke Limited subsidiary) and Saurashtra World Holdings Private Limited (a Saurashtra Fuels Private Limited subsidiary).

The funding package replaces the mandate held by the Westpac Banking Corporation to provide funding of NZ$65 million for development of the mine. The new funding package includes NZ$13 million for capital and other costs associated with the new long term transport arrangements with Solid Energy NZ Limited, additional capital expenditure of NZ$11 million for tunnelling costs (advised to the market in September 2007) and to fully refresh the project contingency of NZ$11 million which has now been utilised.

Pike River Managing Director Gordon Ward says the funding package now being put in place is more favourable for the Company and shareholders compared to the terms of the proposed Westpac senior debt facility. Several terms of the proposed Westpac facility, including the unavailability to draw down the facility until the tunnel had reached first coal (which has been extended by a further two months as a result of the change in pit bottom excavation strategy to assist de-risk this process), restricted the availability and flexibility of the financing. This combined with alterations in the credit market which would be reflected in higher interest rates under the facility, the need for guarantees from NZOG (with the associated costs of this guarantee), and the need to bring in a second bank resulted in the Board reconsidering the desirability of the Westpac facility as offered.

Mr Ward said “The terms and conditions of the Liberty Harbor convertible bond facility provide certainty of funding and greater flexibility for the Company to effectively manage its funding requirements during the early stages of production. It removes both the need for bridge finance until the proposed Westpac facility could be drawn and the requirement for a guarantee from NZOG which was not deemed appropriate or necessary given Pike River’s status as a separately listed stand-alone entity.”

1 Rounded from actual entitlement ratio of 1 Right for every 3.5576594 shares held

The issue of the convertible bonds to Liberty Harbor will rank as senior debt pari passu with another (yet to be identified) provider(s) of debt facilities of up to NZ$15 million, primarily transactional banking facilities (eg for foreign exchange lines of credit). Liberty Harbor is an investment vehicle with more than US$2.5 billion of net assets focussing on corporate investment opportunities. Christchurch based Murray & Company Limited was the arranger for the convertible bond placement.

Interest of 6.75% will be paid on the bonds quarterly in arrears during the three year term. The bonds can be converted to ordinary shares at any time at the discretion of the bondholders.

Any bonds outstanding at the end of three years are to be repaid by Pike River in cash. Pike River’s principal shareholders, NZOG, Gujarat and Saurashtra who account for 48.8% per cent of the shares on issue, have indicated their intentions to vote in favour of the resolution at the special meeting of shareholders to be held on 4 February 2008 to approve the issue of convertible bonds to Liberty Harbor. The resolution will require a simple majority.

A New Zealand Investment Statement and Australian Prospectus for the Renounceable Rights Issue (Offer Document) and an accompanying Entitlement and Acceptance Form will be mailed to shareholders on or about 31 January 20082 and will be available to be viewed online at www.pike.co.nz. The Offer will open on 31 January 2008 and close on 27 February 2008 with allotment of shares made on 3 March 2008. Rights trading will commence on the NZSX on 31 January and on the ASX on 23 January 2008.

Eligible shareholders and noteholders should carefully read the Offer Document when they receive it. If they wish to participate in the Offer, they will need to complete the Entitlement and Acceptance Form accompanying the Offer Document in accordance with the instructions set out in the Offer Document.

Commenting on the forward outlook, Mr Ward said “Attention will now turn to the negotiations by Australian coal producers to set the benchmark price for hard coking coal supplied to Japanese steel mills from 1 April 2008. Indications are for a significant increase on the US$101 per tonne current at the time of the Company’s Initial Public Offering of shares earlier this year, with market observers currently picking hard coking coal prices for next year being well above US$130 per tonne3.”

Tunnelling is now 85 per cent complete at 1960 metres. With the exception of the tunnel costs, announced in September 2007, all significant project costs have been tracking at or below budget. Excavations commenced for construction of the pit bottom area in mid December 2007. This will be where the coal is initially processed before entering a 10.6 kilometre slurry pipeline for transport to the coal preparation plant for dewatering, stockpiling and export to customers through the port of Lyttelton.

[BWR]

16 January 2008


Pike River Coal Mine Development Update

Some substantial progress has been made with the Pike River mine development since the last update to shareholders on 31 October 2007. The tunnel has progressed to 1960 metres, the final design of pit bottom has been completed and excavation started and construction of the coal preparation plant is well underway. The Company’s entry into a new long term transport agreement with Solid Energy NZ Limited, which substantially de-risks the project, was announced to the stock exchanges on 27 November 2007.

As a result of the Company’s decision to halt the tunnel near the Hawera fault and construct the pit bottom facilities with conventional drill and blast tunnelling equipment, the date of intersecting the coal seam will move from late April 2008 to early July 2008. This is a risk mitigation step which should result in more cost-efficient construction of the pit bottom area.

The Company has also reforecast expected coal production in the first 12 months in light of new data from new boreholes drilled around the pit bottom area. Production in that ramp-up period is now forecast at 200,000 tonnes as compared to 240,000 tonnes in the IPO prospectus. A more conservative build-up is appropriate as the new boreholes show more rock will be excavated in the pit bottom area than previously modelled. There is no impact on annual production rates when hydro operations are underway in the following year. In context, a 40,000 tonne reduction translates to about half a month’s production when hydro operations are in progress.

Tunnelling Progress and Pit Bottom Design

The tunnel has progressed a further 260 metres to 1960 metres since the October 2007 Quarterly Report. The tunnel is 85% complete and forecast to reach the Hawera fault in February 2008. The tunnel is now in competent Class III rock, a widening of the tunnel for the rock conveyor has just been completed and a scheduled 600 metre conveyor extension is underway. Tunnelling progress will improve again, once the conveyor extension is completed, as rock will be moved more quickly away from the rock face.

The tunnel commenced the breakaway for the “pit bottom” excavations on 18 December 2007 and following an 11 day break by contractor personnel for the holidays, work on the tunnel and the pit bottom area is now occurring simultaneously. Considerable design work has been done on the pit bottom excavations in the area east of the Hawera Fault to minimise driveage in the hard gneiss rock and therefore excavation volumes.

The tunnel will continue in parallel with the pit bottom excavations until it reaches a position some 50 metres from the intersection of the Hawera fault. The tunnel will then halt at this point to allow excavation to be completed in the hard gneiss with conventional tunnelling equipment and explosives. Once the barrier to the fault is traversed, the tunnel will be deemed to be a coal mine due to the potential presence of methane gas, and all non-flameproof equipment will be removed from the tunnel and replaced with purpose built equipment for use in a coal mine. This strategy of halting the tunnel to complete the excavations with the more suitable equipment will reduce risk of both time and capital increases as the flameproof equipment would be much less efficient in the hard gneiss rock. However, this does mean that the tunnel will not intersect the coal seam until early July 2008, two months later than prior projections.

Since the last update a further two boreholes have been completed in the pit bottom area. One hole was drilled at the site of the ventilation shaft west of Hawera fault and the most recent hole was drilled east of Hawera into the site of the underground coal handling facilities. The shaft hole provided further detailed knowledge of the geology of the shaft site and confirmed the geological model for the coal but also indicated that, while the coal in the immediate vicinity is greater than 9 metres thick, initial driveages around the shaft site will have to take a greater proportion of stone to accommodate the required tunnel grades. This is only an issue for this immediate area which is defined by the tunnel and shaft locations. It does not affect the greater geological model or resource where there is considerably greater flexibility in roadway positioning to achieve grade.

The pit bottom area west of Hawera in the coal measures will accommodate the ventilation shaft and the two main mine fans, the raw coal slurry ponds, the hydro monitor pump station and a large water storage facility. The pit bottom excavations to the east of Hawera will house the coal crushing plant and slurry sump, the fluming water sump and the electrical installations.

With the additional information from the five new boreholes to hand, Pike management has modeled a slightly more conservative ramp-up in production during the first 12 months of 200,000 tonnes. This compares to 240,000 tonnes forecast for the first 12 months in the IPO prospectus. There is no impact on the annual production rate in the second year onwards.

Recruitment in Full Swing

With total staff now at 27, Pike will look to recruit a further 45 employees ahead of first coal production. The current staff includes the senior management team and a range of professionals in all areas of operations and support services. Future recruitment will be more focussed on trades and general production workforce.

Mining Equipment and Infrastructure

In other project activities, the roadheader, which will drive the tunnel from the Hawera fault and most of the pit bottom coal and stone driveages, was delivered to the mine site in early January 2008, with the continuous miners due to be completed in March 2008 and delivered to the mine-site in mid 2008.

Construction on the Coal Preparation Plant (CPP) commenced in November 2007 as forecast and is progressing well, with footings being poured. The CPP will be completed ahead of coal production from the mine.

Similarly work is well advanced on the mine’s bathhouse facilities opposite the CPP with foundations laid and frames erected. The bathhouse will be used by the mine’s production and engineering workforces as they commence in 2008.

Installation of the 8.5 kilometre surface section of the 275 mm coal slurry pipeline is progressing well with the first 4 kilometres and two bridge crossings successfully installed. The pipeline is being laid along the edge of the access road on concrete plinths which will also carry the 300mm return water line.

[blockhead]

At $1.00 for PRC today it is hard to see shareholders getting wealthy by selling their rights, another chance to get in @ $1.00 or less I would say and haven't had to hold since IPO

[ratkin]

Reading that report two things stand out

1) There is a delay in reaching the coal from april to july
2) They are going to produce less coal than they forecast in the prospectus

Glad i dont own this mutt

[tim23]

Is a 2 month delay a big issue in the scheme of things? - mutt bit harsh, I guess time will tell.

[winner69]

Is a 2 month delay a big issue in the scheme of things? - mutt bit harsh, I guess time will tell.

I think Ratkin would say the 16% downgrade in how much they will produce in year 1 ..... a lot of punters would see this as a credibility issue more than anything else ..... and isn't credibility important

[Dr_Who]

Reading that report two things stand out

1) There is a delay in reaching the coal from april to july
2) They are going to produce less coal than they forecast in the prospectus

Glad i dont own this mutt

Minning is abit like large scale construction, it is fundamental to build in cost over budget and delays. Very rare to see any large scale project that is not over budget and without delays. We used to have a few commercial buildings in the Auckland CBD that we developed and it never comes under budget nor ahead of schedule.

The coal is still in the ground, just taking them a fraction longer to dig it up. To me this is an opportunity to accummulate more shares on sp weakness.

[Unicorn]

I found this bit to be very interesting ...
"The new funding package includes NZ$13 million for capital and other costs associated with the new long term transport arrangements with Solid Energy NZ Limited, additional capital expenditure of NZ$11 million for tunnelling costs (advised to the market in September 2007) and to fully refresh the project contingency of NZ$11 million which has now been utilised."

1. There was no mention of this $13M when the change to rail transport was announced just a few weeks ago.

2. The full project contingency of $11M has apparently been used now, and this is separate to the extra $11M tunnel cost, yet "With the exception of the tunnel costs, announced in September 2007, all significant project costs have been tracking at or below budget."

This omission of key facts and conflicting information make it difficult to have confidence in what PRC is telling the market. The two months delay is not something that concerns me, and the more important reduction of 40,000 tons in the first year is not too bad in the overall scheme of things. But if I can't trust what I am told, then I am staying away.

Can any shareholders shed any light on these issues?

[ratkin]

Credibility is key , the ink is barely dry on the prospectus.

Yes these projects often have delays , all the more reason why the company should have been consevative (realistic) with its prospectus.

I suspect this will be the first of many setbacks , staff, tunneling , transport etc etc

[AMR]

Could someone explain how much % dilution there is if the rights issue goes ahead? I'm a bit unclear on how the convertible bonds work

[Xerof]

Could someone explain how much % dilution there is if the rights issue goes ahead? I'm a bit unclear on how the convertible bonds work

The rights issue will go ahead - its underwritten.....

there will be some dilution of future EPS as there are more shares issued. Doubtless one of the broker houses will publish some new figures in due course. Dilution will be mitigated somewhat by the fact there is no longer interest payable on the proposed borrowings from NZO and WPAC

Convertible Notes..... Liberty have the right to convert the Notes to shares at $1.30 at any time within the next 3 years. This will further dilute EPS if they do, otherwise its just debt.

[Bilo]

I found this bit to be very interesting ...
"The new funding package includes NZ$13 million for capital and other costs associated with the new long term transport arrangements with Solid Energy NZ Limited, additional capital expenditure of NZ$11 million for tunnelling costs (advised to the market in September 2007) and to fully refresh the project contingency of NZ$11 million which has now been utilised."

1. There was no mention of this $13M when the change to rail transport was announced just a few weeks ago.

2. The full project contingency of $11M has apparently been used now, and this is separate to the extra $11M tunnel cost, yet "With the exception of the tunnel costs, announced in September 2007, all significant project costs have been tracking at or below budget."

This omission of key facts and conflicting information make it difficult to have confidence in what PRC is telling the market. The two months delay is not something that concerns me, and the more important reduction of 40,000 tons in the first year is not too bad in the overall scheme of things. But if I can't trust what I am told, then I am staying away.

Can any shareholders shed any light on these issues?

I also was blinded by the "under budget and the requirement for $80M more than budget" on a minor delay - give us a break directors!
40,000 tonnes in 1Mpa, 2 future weeks of production, is not worthy of a profit warning - a distraction from the main story, perhaps.

[The BOWMAN]

Could someone explain how much % dilution there is if the rights issue goes ahead? I'm a bit unclear on how the convertible bonds work

What dilution? Current market price $1, new issue price $1, no dilution at all.

[Xerof]

Bilo, since when has 60+40-65-25-11 = 80?

new share capital = 60
convertible notes = 40

replaces proposed debt facility = 65
replaces proposed NZO funding = 25
prev announced over-budget exp = 11

[TwinkleToes]

Forgive me if someone has already made this comment but I believe the price of coking coal will come off sharply along with other commodities in the face of a much more severe global recession that is generally accepted.

Long term, yes, I think coking coal is going to go up but not in the short to medium term.

We have already seen a fall of almost 10% in oil from its peak and I expect other commodities - except maybe softs, agricultures - to follow withi the forst calender quarter.

[the machine]

the thing i don't like about the new issue/bonds etc is that it dilutes the value of our holding
.
being in the ipo we have financed prc thus far with expectation of the various loans coming into play "expensive loans yes" but the loans did not dilute our holding.

we have been diddled and the new financial scheme will enable those behind it to cash in on our investment thus far.

imo prc have taken the easy money before the interests of existing shareholders and they deserve a huge rocket - they have done a disservice to the existing shareholders through the dilution.

M

[the machine]

looks like prc have put a huge effort intot he spin re the new finance, pity they did not afford the same effort / rewspect to their shareholders.

M

[winner69]

......we have been diddled

...... they deserve a huge rocket

......they have done a disservice to the existing shareholders




Pretty emotive words mate

Take it any credibility PRC management had in you eyes has evaporated

[winner69]

I also was blinded by the "under budget and the requirement for $80M more than budget" on a minor delay - give us a break directors!
40,000 tonnes in 1Mpa, 2 future weeks of production, is not worthy of a profit warning - a distraction from the main story, perhaps.

Agree the quantum is insignificant in the big picture ...... 16% less in the first year will probably be mined sometime in the future ..... as long as the 'modelling' is robust

Credibility is the key .... and many would say that they are strtching their credibility a fair bit .... and that maybe ... just maybe ...... a 'more conservative view' (their word) has to be taken of the total resource

[dsurf]

the thing i don't like about the new issue/bonds etc is that it dilutes the value of our holding
.
being in the ipo we have financed prc thus far with expectation of the various loans coming into play "expensive loans yes" but the loans did not dilute our holding.

we have been diddled and the new financial scheme will enable those behind it to cash in on our investment thus far.

imo prc have taken the easy money before the interests of existing shareholders and they deserve a huge rocket - they have done a disservice to the existing shareholders through the dilution.

M

Couldn't agree more - The debt facility was in place - I do not want to be diluted - I think it is a mechanism for the indians & NZO (groan - thought they were investing in oil & gas in the future) to increase there stake in a substantially de-risked project to increase thier stake & of course mcdoull stewart to pick up a fat fee

Also pees me off that just when the SP was gaining traction a ceiling of a $1 has effectively been put in place - thanks directors who get their holding for free

(beginning to agree with macd more & more on the self serving trough dwellers)

[Bilo]

Bilo, since when has 60+40-65-25-11 = 80?

new share capital = 60
convertible notes = 40

replaces proposed debt facility = 65
replaces proposed NZO funding = 25
prev announced over-budget exp = 11

Note The Machine's response. Debt didn't dilute our interest and is tax efficient to us - so I didn't count it as money out of my pocket to make this thing fly. A nasty change although we knew the Westpac money was not certain.

[duncan macgregor]

What dilution? Current market price $1, new issue price $1, no dilution at all. BOWMAN, The dilution is PRC has 200 million shares on issue now it will have 260 million shares on issue. Your dividends when they finally arrive will be that much less. This is why unless you are a trader or speculator you should stay clear until the final numbers are out. Two years to wait for a divi plus risk involved with money tied up in uncertainties isnt a good fundamental buy. Traders and speculators and those in the know [notice the sellers before this was announced in comparrison to NZO] for instance. The cowboy exchange is still alive and well learn to read it. Macdunk

[Bilo]

Pretty emotive words mate



Emotive language yes. Right on the button YES.
Thanks Machine, with the way the share price rocketed down since prior to Christmas and particularly in 2008 they deserve a few emotive rockets and probably a visit from the NZX surveillance committee.

And which way will the share price go today???

[duncan macgregor]

20M PRC change hands on the ASX...AUD90c This was the warning the smart money got out. Macdunk

[blockhead]

Not the case McDuck, read the announcement yesterday, just the Indians shuffling some of their holding from one name to another

[AMR]

A double top got confirmed by yesterday's close below 1.02. I'm worried enough to sell. If we apply the measure rule then it's going right back to the 80s again.:eek:

[777]

While the share price is below $1, no one will take up the rights. Where to then?

[Bilo]

A double top got confirmed by yesterday's close below 1.02. I'm worried enough to sell. If we apply the measure rule then it's going right back to the 80s again.:eek:

Maybe that was the reason for the stock transfer to OZ. The underwriters for these options may have a chance of exceeding the takeover offer threshold and they can hide the 10pc holding far enough away so that it doesn't count.

It was dirty to sell the stock down to the issue price before announcement and then wait two weeks for due date. And there are no buyers...

[Hoop]

Interest free loan, so approx $5 million now added to the bottom line, a lot of that money comes from the Indians and NZO.

Rights issue was signaled to happen early 2008, (from prospectus I think?) so no credibilty issues really.

PRC will probably tank due to shareholder emotion and bear market influences...I cursed the day I didn't top up at 85 cents...maybe ..just maybe there is a remote posssiblity I may get a second chance:).

Hasn't been many bargain buys since IPO time, the PRC project has operated rather well with very little bad news, rather a rare achievement I would have thought. (I'll go and touch wood now....commentators curse?:( )

Disc PRC.NZO,DPC, 85% cash

[jke_brown]

follow up on "2008 NZ market overview and general outlook - SC - " thread for my tip on lower risk ticker from PRC coal. :)

[Wilkins_Micawber]

Aren't they going to need the share price over $1.00 before the rights issue will have any effect (generate any money)? I certainly wouldn't be paying $1 per share right now - and I would hope that NZO might have 2nd thoughts as well...

[the machine]

the main dilution comes with convertable notes which replaces debt

The issue of the convertible bonds to Liberty Harbor will rank as senior debt pari passu with another (yet to be identified) provider(s) of debt facilities of up to NZ$15 million, primarily transactional banking facilities (eg for foreign exchange lines of credit). Liberty Harbor is an investment vehicle with more than US$2.5 billion of net assets focussing on corporate investment opportunities. Christchurch based Murray & Company Limited was the arranger for the convertible bond placement.


M

[dsurf]

Only market morons would announce a rights issue for a $1 when the share price is a $1 & falling. Maybe it is deliberate so that the indians & NZO can increase their stakeunder the underwriting agreement. Also what sort of advice is the lead broker giving to justify their 600k? (1%)? fee. Absolutely hopeless understanding of markets.

[Billy Boy]

[QUOTE=tim23;179930]Yes I have PRC shares but I can sell them for a market price not to a thief.


17th Jan / 11.00am buying 86 cents...... selling 95 cents
You still on @ 90 cents ??. Pay your own brokerage now.
(Joking)
--------------
How do you guys get these smiley icons etc to come up in the text?.
wont work for me.

[blockhead]

Don't need the icons in your case BB, we know you will be smiling !

[whirly]

As alluded to in the first post I made after PRC pulled the rug from under Greymouth's hopes for good investment in the port I see they are treating their shareholders the same way.

More surprises too come I expect.

[Unicorn]

Aren't they going to need the share price over $1.00 before the rights issue will have any effect (generate any money)? I certainly wouldn't be paying $1 per share right now - and I would hope that NZO might have 2nd thoughts as well...

From what I have read the issue is fully underwritten, so it does not matter what the share price is - they will get the $60M (unless there is something in the fine print). NZO and the two Indian companies are taking their share, then the broker (as underwriter) picks up any that the minority holders do not take up. I doubt that NZO will have 2nd thoughts - they have agreed to take their share, and it is in everyone's interests that they do so.

This looks like a good deal for the minority holders as it means less dilution than might be expected.

[duncan macgregor]

I would have thought that 11.6 millionn dollars would have been better spent on their own powerhouse generator system. Lets face it if its alright to ship it to india to burn why not burn a bit here first to generate cheap power for the project. I presume the greenies would be up in arms if they did that, but dont mind it being exported overseas for similar reasons. A lot of downside on this share still to come before the first divi fronts up. I see 80c on the horizon before that happens. Macdunk Looks like the downside was right. The 80c a share is still on the cards i think it only went down to 86c last time after i posted that. Markets in turmoil the options for a dollar wont eventuate in this market i wonder what PLAN B IS?. If the company thinks 200 million shares are worth a dollar at the start what will the investors think 260 million shares worth in the same company?, you do the numbers, thats what the company is trying to sell you. The project will go ahead regardless of the market, or whatever funding is in place, the more bad news that comes out the bigger the bargain buying in later on. Macdunk

[Toddy]

As alluded to in the first post I made after PRC pulled the rug from under Greymouth's hopes for good investment in the port I see they are treating their shareholders the same way.

More surprises too come I expect.

Whirly

Greymouth stuffed up the port opportunity themselves with their delays in signing off the funding for the project. PRC shareholders are more than happy with the Christchurch transport option.

The funding package announced yesterday is a better option that the Westpac deal. The major shareholders are behind PRC all of the way. I know that it hurts the small guys in the short term but if we are all in for the long run then we will receive the benefits in the future.

[AMR]

A very expensive lesson for me from this debacle. Looking back technically there were sell signals all the way back in November. I am never going to fall in love with a stock again and not bother checking it.:mad:

[winner69]

A double top got confirmed by yesterday's close below 1.02. I'm worried enough to sell. If we apply the measure rule then it's going right back to the 80s again.:eek:


Sounds like a good short then mate

[whirly]

Toddy you are right major shareholders are in for the long haul Im just a tad dubious the port was ever going to eventuate.

[Hoop]

A very expensive lesson for me from this debacle. Looking back technically there were sell signals all the way back in November. I am never going to fall in love with a stock again and not bother checking it.:mad:

Keep using your bearmarket strategies AMR, you are still doing these aren't you? From your posts, I thought you had a good set of strategies in place.
As you say maybe more discipline needs to be applied.

As winner suggests why not go short in PRC. In this case, at least it may balance your longs in PRC if you are finding it very difficult to part with these.

It's blo0dly difficult investing in a Bear market at the best of times (pun). As I lack time, I take the easy route, cash most of it up and sit it out on the sidelines.

Like you, I have an odd pet favourite I find hard to part with(PRC,NZO). I'm naughty really... breaking the discipline...from my past history I usually live to regret those decisions....can't help myself though:o

[Billy Boy]

Don't need the icons in your case BB, we know you will be smiling !
Yep I am.......
Get in again Blocky
They are good buying at 95c Even if they do go a tab lower.
BB

[chippy52]

At top of page click user cp
click edit options
at bottom of page Misc Options change to full editing mode

[BWR]

Unicorn has raised the point that there was no mention of the $13M when the change to rail transport was announced just a few weeks ago. In that regard he is correct because at the time Pike River hadn't made the decision to fund the new rail load out facility itself. That is a recent and subsequent development.

Of the $13m mentioned above $11m relates to the rail load out facility. The decision for Pike River to fund the cost of the facility, rather than Solid Energy, is accompanied by cost savings in the freight rate that well justify the decision, and ensure that the facility is completed in time and is under the control of Pike River. The freight rate saving is in the order of $1 per tonne.

I expect a full release will be made when the final details of this part of the project are finalised.

[Unicorn]

Unicorn has raised the point that there was no mention of the $13M when the change to rail transport was announced just a few weeks ago. In that regard he is correct because at the time Pike River hadn't made the decision to fund the new rail load out facility itself. That is a recent and subsequent development.

Of the $13m mentioned above $11m relates to the rail load out facility. The decision for Pike River to fund the cost of the facility, rather than Solid Energy, is accompanied by cost savings in the freight rate that well justify the decision, and ensure that the facility is completed in time and is under the control of Pike River. The freight rate saving is in the order of $1 per tonne.

I expect a full release will be made when the final details of this part of the project are finalised.

Thanks BWR, good news.

[Billy Boy]

At top of page click user cp
click edit options
at bottom of page Misc Options change to full editing mode
:D TKS CHIPPY :D
BB

[AMR]

:o
Keep using your bearmarket strategies AMR, you are still doing these aren't you? From your posts, I thought you had a good set of strategies in place.
As you say maybe more discipline needs to be applied.

As winner suggests why not go short in PRC. In this case, at least it may balance your longs in PRC if you are finding it very difficult to part with these.

It's blo0dly difficult investing in a Bear market at the best of times (pun). As I lack time, I take the easy route, cash most of it up and sit it out on the sidelines.

Like you, I have an odd pet favourite I find hard to part with(PRC,NZO). I'm naughty really... breaking the discipline...from my past history I usually live to regret those decisions....can't help myself though:o

Pike River was in fact the majority of my portfolio:eek:...that's how in love I was. This shocker of an announcement has me a bit shaken up...it feels like my wife cheated on me:D.NZO I'm quite happy to keep holding since it has actual earnings and cash at the moment and in a less bearish market would be re-rated by at least 20%. As for my bear market strategies, I closed my short on FBU since it was getting close to the psychological $10 barrier (with resistance at 10.20 and further resistance at 9.60 or thereabouts). Take a look at RYM, it seems to have nearly completed a cup-and-handle pattern today (bearish). As for indices, I've missed most of the move on the Dow, the SP500, and the Nikkei 225 and the Dow seems close to resistance at 12000. Life gets in the way of sharetrading!

[Billy Boy]

:o

Pike River was in fact the majority of my portfolio:eek:...that's how in love I was.

Me too.....:o
Been doing my sums for about the sixth time. Showing off to my friends
coz a had a sizeable chuck averageing about 89c :eek::eek:. Mutter, Mutter.:mad:
Thank god I listened to the likes of Digger and didn't jump in again as of
late and waited.
Still they'll come right in 2009.
The question is.
Who of us Plebs will pay $1.00 for a 95 cent share. Could be a lot less
after the dilution in march. The whole deal stinks a bit.
The way the SP dropped, just a bit out from this announcement !!
Good to see the insider's flying there flag :rolleyes::rolleyes: Still.
BB

[Billy Boy]

PRC Rights Issue
Proposed Timetable

Key dates1 in the current proposed timetable for the Offer are as follows:

Announcement of Offer 16 January 2008
Offer Document lodged 17 January 2008
Existing shares quoted ex-entitlement 23 January 2008 (ASX)
31 January 2008 (NZSX)
Record Date 30 January 2008
Offer Document mailing date 31 January 2008
Shareholder meeting to approve Convertible Bond placement 4 February
2008
Close of Rights trading 20 February 2008 (ASX)
25 February 2008 (NZSX)
Offer closes (Closing Date) 27 February 2008
Allotment date and issue of New Shares 3 March 2008

The Rights Issue forms part of a NZ$100 million new equity and senior debt package, to complete development of Pike River's West Coast premium hard coking coal mine and support operations until steady state production from hydro monitor mining is achieved, announced on 16 January 2008.

[zorba]

.
Newkie thermal coal hits near record nudging US$90 / tonne

Must be a good omen for coking coal !!

GO PRC !!!!
.

************************************************** ******************

Newcastle Coal Price Rises as Rains Reduce Australian Output

By Angela Macdonald-Smith

Jan. 21 (Bloomberg) -- Power-station coal prices at Australia's Newcastle port, a benchmark for Japan, South Korea and Taiwan, rose 0.5 percent to near a record as rain cut output at mines in Australia's Queensland state.

The price for coal, excluding shipping costs, for delivery within three months rose 44 cents to $89.85 a metric ton in the week ended Jan. 18, according to the globalCOAL NEWC Index, an Asian benchmark calculated each Friday. Coal prices surged 73 percent in 2007 and reached a record $91.77 a ton in the week ended Jan. 4.

Above-average rainfall in central Queensland is reducing output at mines including Xstrata Plc's Newlands and Collinsville sites, and Rio Tinto Group's Kestrel mine. Heavy rainfall also cut exports from Indonesia, amid rising purchases by China which are resulting in supply shortfalls for customers in Japan and South Korea.

``Quite a few of the mines in Queensland have an awful lot of water in them, a lot of the open-cut mines, including at least one of the thermal coal mines,'' said Clyde Henderson, a Sydney- based coal analyst at Barlow Jonker Pty, a unit of Wood Mackenzie Consultants Ltd.

Coal rail transportation on both the Newlands and Goonyella networks in central Queensland was halted on Jan. 18 by flooding, Australian Associated Press reported. While the rail closures will mostly affect coking coal used in steelmaking, some thermal coal is shipped through the networks, Henderson said.

China Demand

Coal demand in China, the world's biggest consumer and producer of the fuel, may rise 5.3 percent to 2.76 billion metric tons this year, an official at the Coal Sales and Transportation Association of China said last week. Consumption rose 9.5 percent last year.

China will be a net importer of 18 million tons this year, after having ``nearly balanced'' export and import volumes last year, UBS analysts, led by Ghee Peh in Hong Kong, said in a Dec. 6 report.

Newcastle will have the capacity to load 95 million tons of coal this year, less than producers' demand, according to Port Waratah Coal Services Ltd., the operator of the two coal terminals at Newcastle. Last year the terminal increased shipments of the fuel by 6.3 percent to 84.8 million tons, short of a target of 90.5 million.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net

[Steve]

Chris Lee has a few interesting comments regarding the PRC shareprice drop since the rights issue announcement.

It's the uneducated who are jumping off the ship...

I see it as a buying opportunity should the price drop back to the 80's...

[duncan macgregor]

Chris Lee has a few interesting comments regarding the PRC shareprice drop since the rights issue announcement.

It's the uneducated who are jumping off the ship...

I see it as a buying opportunity should the price drop back to the 80's... I would think that you have that the wrong way round. Its the educated that jumpted ship leaving the uneducated holding the baby. This is an example of how market sentiment rules, and fundamentals meaning nothing. The people that had bought this share with a TA buy signal and sold with a simple stop loss are laughing all the way to the bank with your money. Next buy signal is when the sp gets above the 30 day moving average which is about 108c at the moment dropping. Do that then set a simple 10% stop loss on it like you should have done all along not worrying about the price of coal which means nothing when market sentiment takes over. Macdunk

[AMR]

I would have gone for those covertible bonds in a minute had they offered it to us shareholders. Minimal risk and excellent upside, if they run into further difficulties they still get their cash back. The rights issue on the other hand is fully exposed to further tunnelling risk, which I have no appetite for at the moment due to the market.

Also there is the nagging feeling that future upside from the stock has been significantly diluted, and that there are better stocks out there on the ASX.

[Mike.Gayner]

I would think that you have that the wrong way round. Its the educated that jumpted ship leaving the uneducated holding the baby. This is an example of how market sentiment rules, and fundamentals meaning nothing. The people that had bought this share with a TA buy signal and sold with a simple stop loss are laughing all the way to the bank with your money. Next buy signal is when the sp gets above the 30 day moving average which is about 108c at the moment dropping. Do that then set a simple 10% stop loss on it like you should have done all along not worrying about the price of coal which means nothing when market sentiment takes over. Macdunk


The low volume over the past 2 weeks suggests to me a panicking few, rather than institutional "smart money" leaving. So unless the "educated" is as tiny a group as the numbers suggest, I would say the smart ones are sticking around.

[AMR]

The smart ones would have sold out at 1.10 on topping pattern. I have to admit I made another mistake by selling out after the bad news had been priced in and a third mistake by running my TA on both intra-day and closing prices depending which program I was using. There were a net total of four sell signals that would have gotten a smart investor out at significantly higher prices. You need to apply the same monitoring regime regardless of how much you like the company and remove all emotion from your trading decisions. I still believe in the PRC story, just not in the short term.
http://img137.imageshack.us/img137/9338/prcmistakekc9.png

[swissboy]

I can not understand this Co nor NZO. Why do they treat NZ Shareholders with such contempt? On the ASX they advise of a trading halt but we are kept in the dark????

[swissboy]

It's just come on
sorry

[bermuda]

Hey I didnt take up my full quota of PRC but I thought I would support it with 50k.

I have got nothing but admiration for the tenacity of NZO to add this string to their bow.

Forget the doom and gloom, this company is really going to outperform.

A guy told me last night. NZ consumes 1 million tonnes of cement a year, the USA 100 million tonnes and China...............

1 billion tonnes per year.

Now just think through the ramifications of that. I hadnt thought of it but these are very telling statistics.

The world will keep turning without the USA.

[STRAT]

Hi Bermuda, I heard on the box tonight ( so not verified as factual ) the US as a consumer accounts for more than 50% of consumption for the entire world. No wonder they are in debt lol. Surely a recession there will impact hugely on exporters like China? If they cant sell their goods then surely their own consumption both for export and domestic will fall. This would apply to most export based economies?

Just a thought

[winner69]

I clearly recall some numbers in a BHP preso


BHP said that in 2003 there were 45 cities (based on how BHP defined a city) - made up of 4 which BHP described as big cities. The modelling they did had the number of cities in 2010 rising to 86 of which 10 would be big cities .... and by 2025 there would be 147 cities of which 18 would be big cities .... and that was just China and they saw the same sort of growth in India

That growth in the number of cities is the platform for BHP future .... all the stuff needed to build all those new cities ...... like the cement figures you quoted bermuda.

Must try to find a copy of the preso

All that growth is not going to stop tomorrow is it .... or next year .... or the year after .... the demand for whatever is needed to build things is huge and assured for many years to come irrespective to what might happen to the worlds economies over the next year or so ... this is a long term story

[bermuda]

I clearly recall some numbers in a BHP preso


BHP said that in 2003 there were 45 cities (based on how BHP defined a city) - made up of 4 which BHP described as big cities. The modelling they did had the number of cities in 2010 rising to 86 of which 10 would be big cities .... and by 2025 there would be 147 cities of which 18 would be big cities .... and that was just China and they saw the same sort of growth in India

That growth in the number of cities is the platform for BHP future .... all the stuff needed to build all those new cities ...... like the cement figures you quoted bermuda.

Must try to find a copy of the preso

All that growth is not going to stop tomorrow is it .... or next year .... or the year after .... the demand for whatever is needed to build things is huge and assured for many years to come irrespective to what might happen to the worlds economies over the next year or so ... this is a long term story

Yes, well said, that's what I have been thinking too. That's why I think oil and resources will remain strong.........and if the Saudi's are found wanting..well ...watchout.

In the meantime we will have all these 'economists' forecasting huge drops in resources and oil.

I mean, look at the stats.Great post. thanks.

[Dr_Who]

Hey Winner, population will continue to grow, but the money supply will change constantly and get moved around the globe. Population growth does not equal economic growth.

[digger]

It has always been imposible to know which way the cookey is going to crumble with any great degree of certainty. The closest we can guess with confidence is that the world economy will continue to shift to oil producers and Asia and away from the US. A very changed world coming on the horison i would say,and not one that will just go back to it's old pattern in 18 months or two years.

[Bilo]

Hey Winner, population will continue to grow, but the money supply will change constantly and get moved around the globe. Population growth does not equal economic growth.

Dr, China has had a one child policy for many years.

[AMR]

When are the negotiations for the price of coal due to complete this year?

Xstrata has apparently tabled $210 a tonne. (Reuters)

[bermuda]

When are the negotiations for the price of coal due to complete this year?

Xstrata has apparently tabled $210 a tonne. (Reuters)

I think on an earlier thread I said that it would be $US148.

A bit of softening going on but hopefully a lot higher than $US96.

[dsurf]

PRC
25/01/2008
HALT

REL: 1104 HRS Pike River Coal Limited

HALT: PRC: PRC - Trading Halt of Securities

25 January 2008

NZX Regulation Announcement
Pike River Coal (PRC)
Trading Halt of Securities

NZX Regulation advises that at the request of Pike River Coal (PRC), a
trading halt has been placed on its securities. In accordance with NZSX
Listing Rule ("Rule") 5.4.1(a) NZX will place a trading halt on PRC ordinary
shares immediately, pending the release of further material information in
relation to Rights Issue previously announced to the market on 16 January
2008.

Under rule 5.4.1(a) trading in PRC ordinary shares will be halted until the
earlier of:
- An announcement is made by PRC in respect of amendments to the Rights
Issue previously announced to the market on 16 January 2008;
- The opening of trading on 29 January 2008
PRC expects to be able to make the proposed announcement today. PRC's
securities are currently in trading halt on ASX pending this announcement.
PRC will further advise the market prior to opening of trading on ASX at 10am
Sydney time today (12 noon NZ time).

[Snow Leopard]

Revised rights issue price of 90c (http://stocknessmonster.com/news-item?S=PRC&E=NZSE&N=159726)
Now that should give you something new to moan about and fuel MacDunk up :)

[manxman]

Revised rights issue price of 90c (http://stocknessmonster.com/news-item?S=PRC&E=NZSE&N=159726)


And even though the new announcement is absolutely neutral with regard to share value, the price drops. Chris Lee must be gobsmacked.

Mx

[duncan macgregor]

Revised rights issue price of 90c (http://stocknessmonster.com/news-item?S=PRC&E=NZSE&N=159726)
Now that should give you something new to moan about and fuel MacDunk up :)
Its not me striped one that gets fueled up its the shareholders that get fooled down. Imagine the company admitting you were over charged at the start paying a dollar for something they now value at 90c. Says a lot for the gullible fundamental analists that swallowed the bait. Typical NZO shananigans but never mind as long as you can discuss the price of coking coal and rave on about peak oil you wont notice them playing dirty tricks emptying your wallet out. Its a bit late for a boxing day sale dont you think?. Macdunk

[Dr_Who]

LOL ... It is only a psychological factor in the drop of the rights price, your entitlement is increased, so it is the same.

[manxman]

Imagine the company admitting you were over charged at the start paying a dollar for something they now value at 90c.

Well not quite. The company is inviting me to buy 10 shares at 90 cents instead of nine shares at $1.00.
Everyone who takes up their entitlement will finish up owning the same proportion of the company as under the original proposal, and will pay the same amount as originally proposed.
The new scheme allows rational trading in the rights, because they should maintain a positive value.

A quick calc based on a pre-announcement price of $1.00 indicates that my one share should now fall in price to 97.6 cents, the 90 cent right should be worth 7.6 cents, but only 0.3125 rights come with each share, so I have 2.4 cents worth of rights attached to each share.

The revised price neither adds nor subtracts value from the company, and the share value (which still has the rights attached) should not have been affected.

As Chris Lee has said, with this company, any news seems to be bad news, even the good news.

Mx

[duncan macgregor]

Well not quite. The company is inviting me to buy 10 shares at 90 cents instead of nine shares at $1.00.
Everyone who takes up their entitlement will finish up owning the same proportion of the company as under the original proposal, and will pay the same amount as originally proposed.
The new scheme allows rational trading in the rights, because they should maintain a positive value.

A quick calc based on a pre-announcement price of $1.00 indicates that my one share should now fall in price to 97.6 cents, the 90 cent right should be worth 7.6 cents, but only 0.3125 rights come with each share, so I have 2.4 cents worth of rights attached to each share.

The revised price neither adds nor subtracts value from the company, and the share value (which still has the rights attached) should not have been affected.

As Chris Lee has said, with this company, any news seems to be bad news, even the good news.

Mx Thats still a gobblegook way of saying they value the share at 90c.
The market told you that today dropping the sp 3%. Macdunk

[dsurf]

Thats still a gobblegook way of saying they value the share at 90c.
The market told you that today dropping the sp 3%. Macdunk

I am with MACD - The only person who wins is the underwriter McDoull stewart who is paid how much??? to underwrite an issue for $1.00. It was set at a $1 so that the head price would not fall & annoy investors who paid $1 a long time ago. This creates bad sentiment and ongoing investor mistrust of statements since the goalposts are always moved. Reminds me of the boy who cried wolf. My holding IS worth less post announcement than before announcement. All traction in the SP has been stopped to accommodate a broker who is being paid anway!!! And the reason for the price drop is insulting. It was dropped so that the rights were in the money - not because of an obscure clause regarding a 10% fall in the "markets". The underwriter was never going to take these up.

Also I was never going to take any rights up - I thought we were getting options for free about now. All I get now is dilution!!!! and I do not trust the company statements more than ever. Fortunately outside contractors are building the mine, Toll transporting it & Indians buying it.

Message to management - please stick to what you say you are going to do until some coal is produced as I am sick of the huge discount that this share needs since no-one knows what will happen next

[manxman]

Thats still a gobblegook way of saying they value the share at 90c.
The market told you that today dropping the sp 3%. Macdunk

With all due respect to Mr Market, sometimes he just gets it wrong.
Mr Market has NZO at $1.09 and NZOOD at 5.4 cents with five months to run. If anyone can rationalize that, it would add to my education.

Anyway, I had a big top up on PRC @95 cents. Much bigger and I would have cleaned out the sellers, and the market wouldn't have told anybody anything. http://www.chrislee.co.nz/product%20news.htm has some thougts on PRC and the market.

Mx

[dsurf]

Wish I was offered the opportunity to participate in the convertible issue instead of the rights. I can borrow for three years at 8.75% - get 6.75% interest back so real funding rate is 2% for the chance to buy at $1.17 (The peak Jan 08 SP) any time over the next three years.

[Balance]

Rights price adjusted? Seems like it's a case for the underwriters of 'heads I win, tails you lose.' They will pick up their underwriting fees for no risk.

[AMR]

Manxman, won't this latest issue cause even more dilution and reduce potential upside?

I'm not sure if I'm reading between the lines properly, but that announcement seems to imply there is a chance of the underwriters bailing and requiring the shareholders to buy more as a backup. I still think PRC will be a good investment in two year's time, but I will wait for the geological risk factor to be mitigated first or a major technical signal to get me back in.

[tim23]

Duncan - the rights issue price is not what they value the company at - company with a $3 share price may have a rights issue @ $1 - so be objective instead of being of be so blind

[Xerof]

Yes AMR, there is further minor dilution, but it's not the end of the world.

Don't read between the lines, there's nothing to be found.

They have stated quite clearly why they decided to adjust the issue price:

- they require liquidity by March in order to continue mine development without interuption, and have kicked WPAC's unacceptably restrictive conditions for funding into touch

- there was an out-clause in the underwriting agreement linked to negative market index movements that, if triggered, and shareholders didn't take up their allocations, they would be left high and dry. Since agreeing all the terms with the underwriters, the markets have moved a little....This week, that level was being seriously tested, so they had to improve the issue terms and 'reset' the underwriting triggers. This also meant they felt they had to adjust the issue price lower as well to reflect the general market movement

At the end of the day, at closing price, shareholders can buy more shares at 90 cents, or possibly sell the rights for 3 to 5 cents. Any residual shortfall is underwritten.

BTW, people seem to be ignoring the significance of Xstrata's opening negotiation level of USD 210/t for HCC for this years contracts, backed up by BHP's implementation of the force majeur clause for current deliveries, caused by the Queensland floods (4 months non-delivery I believe). This will impact dramatically on current supply, and should underpin the negotiations in favour of the producers, including PRC for late 08/early 09

Also, do some research on underwriting, you seem terribly confused on what it means

[winner69]

Only what the sub editor puts in as a headline but to the public this looks like a cut price sale

Pike River Coal cuts price in share offer

http://www.stuff.co.nz/4373399a13.html

[duncan macgregor]

Duncan - the rights issue price is not what they value the company at - company with a $3 share price may have a rights issue @ $1 - so be objective instead of being of be so blind TIM, A company with a sp of $3-00 is completely different to a company with a sp of under a dollar trying to have a rights issue of $1-00.
Why would anyone buy into something for a dollar when it sits on the open market in the 95c range. Its a bit like they are having an after christmas boxing day sale. The 90c rights issue will only drag the sp down lower than it might have been. This has nothing at all to do with the eventual worth of the company which will only be known when its up and running much later in the year. Macdunk

[zorba]

.
DM,

Please be so good as to give us your esteemed opinion on the discussion by Chris Lee on PRC as posted in:

http://www.chrislee.co.nz/product%20news.htm

Look forward with interest.

[duncan macgregor]

.
DM,

Please be so good as to give us your esteemed opinion on the discussion by Chris Lee on PRC as posted in:

http://www.chrislee.co.nz/product%20news.htm

Look forward with interest. ZORBA, My opinion is worth no more or no less than your own opinion. PRC up to the point of running at a measured profit is only a spec running on market sentiment. Some of us see it as high risk, others see it as a dead certainty in the long term. The market is in complete turmoil at the moment, with half the investors withdrawing their money as i have, and the other half scooping up bargains.
PRC is caught out in this shamozzle trying to raise money at the worst possible time.
I would not buy into PRC or any other company at the moment as i expect a market crash. The risks of that are much greater than any small share price gain PRC might have before production begins and a proper measure of expected returns are available. They changed the direction to often for me to feel comfotable with. First it was ordering barges to ship the coal to another port then out the blue railing it to LPC. They then spent a ridiculous ammont of money getting power to the site when it would have been cheaper generating it themselves. I would be much more comfortable buying LPC shares which in the short term have more upside than PRC.
I expect PRC shares to stagnate in this market, and if it crashes then buy up the bargains. Macdunk

[upside_umop]

LPC has stood up well in recent times...but are you not concerned with its high pe multiple?

[JMKC]

Upside, what sort of PE multiple do you think PRC trades on?

[AMR]

If it all goes well PRC will be on a multiple of something like 5 at current prices, hence the chance for a major re-rating once it is derisked.

[RossT]

http://www.nzherald.co.nz/category/story.cfm?c_id=37&objectid=10488897

Well the price of hard coking coal looks like it is set to go the right way.