Bathurst Resources - BRL

[BlackPeter]

My concern is how long will they remain cashflow positive?
The price of thermal coal has been decreasing and their thermal coal contracts are not all long term....will these be renewed and at what price?
Personally I think BRL will need to raise cash to survive.....

I think t64p has a point ... coal, coking coal and the derived steel is quite expensive to transport - i.e. local producers can command a premium. It certainly looks like the New Zealand coking coal market returns much better prices than currently international markets.

Still don't get my head around how Carbon scape (https://www.snowballeffect.co.nz/carbonscape) can get through with a business case assuming long term $450 / ton of coking coal (and claiming that they get even at todays depressed prices $350 from NZ Steel) - but even if BRL manages to get just half of that price, than they would be rocking all the way to the bank.

So - who knows what the future brings, but in my view BRL is at current prices a worthwhile risk to take - but hey, no doubt - it is a risk!

[Flugenbear]

I might be wrong, but I think the contracts BRL has are price fixed for the duration....which would be good considering thermal coal has continued to fall the last year or so....if not then it is highly possible they won't get the same price when these contracts expire.
Certainly miners are out of favour and probably will be for sometime. If they can hang in there for some years then it could all work out.
Not tempted yet, but best of luck to those holding.

[tony64peter]

I might be wrong, but I think the contracts BRL has are price fixed for the duration....which would be good considering thermal coal has continued to fall the last year or so....if not then it is highly possible they won't get the same price when these contracts expire.
Certainly miners are out of favour and probably will be for sometime. If they can hang in there for some years then it could all work out.
Not tempted yet, but best of luck to those holding.

Yes you are right re the contracts. The point I was making is that no one in NZ is going to supply domestic thermal coal less than cost plus margin, regardless of the international pricing. To use international prices for leverage in the next contract round is futile as to import coal here at the relatively small volumes required is too expensive. The market dictates the price and in this case due to geographic position our domestic market does not have a lot of competition.

As long as no other fuel becomes an alternative to BRL's customers, I believe domestic prices will remain the same or increase slightly.

[Flugenbear]

Yes you are right re the contracts. The point I was making is that no one in NZ is going to supply domestic thermal coal less than cost plus margin, regardless of the international pricing. To use international prices for leverage in the next contract round is futile as to import coal here at the relatively small volumes required is too expensive. The market dictates the price and in this case due to geographic position our domestic market does not have a lot of competition.

As long as no other fuel becomes an alternative to BRL's customers, I believe domestic prices will remain the same or increase slightly.

Makes sense and I agree, though I struggle to see price increases. But who knows, I certainly didn't pick oil to be at $58 a barrel either. With the world economy generally looking pretty shabby (except perhaps US and UK) I think commodities will really struggle.
I hope the domestic side works out as this will be the key for them for some time.
However I do agree BRL is as reasonable a long term play as anything going.....IMHO.

[kiwitrev]

Sure, buying up big. Total $4k - just to make some people feel good - you couldn't seriously say the directors were 'buying',

[kiwitrev]

I think you will find there is an important difference between buying and selling.

[Xerof]

More ill-informed falsehoods being bandied about....the buyers are NOT directors, but the blue-eyed senior management having a wee punt at almost no cost.

I can see the temptation in this scenario, but too early for entry for me. Looks more like a capitulation is about to happen.

[blackcap]

More ill-informed falsehoods being bandied about....the buyers are NOT directors, but the blue-eyed senior management having a wee punt at almost no cost.

I can see the temptation in this scenario, but too early for entry for me. Looks more like a capitulation is about to happen.

I too am watching from the sidelines and have not yet pulled the trigger. But it is 90% safer/less risky to invest in BRL now than when they were at 20 cents. If for instance you were planning on purchasing 100,000 shares at 20 cents ($20K), that same parcel will now only cost $2k. That makes this stock almost "riskless" at these prices. I say almost because you can still lose the $2k off course. But there may be some shell value as well...

[Xerof]

Yep, but you can still lose 100%

on a positive note (?), Republic are averaging down with another 1% odd added to their pot

[BlackPeter]

But there may be some shell value as well...

There probably is: the small mines in mid Canterbury and Southland which currently supply (mainly) Fonterra with coal must have some value ... and don't forget tricha's hobby horse: a perfectly good $7 Million hall newly erected at the Westport harbour. Could become the new town hall or a tourist attraction -who knows? As well - the mining rights are only worthless as long as the coking coal price is low.

Just $18M market cap at 1.9 cents ... just wondering whether Solid Energy has still some change left from buying PRC?