Bathurst Resources - BRL

[Regi]

Really does seem like a grim future and no hope in sight at this point... would it be best to cut losses and sell? Getting pretty fed up with it dropping 0.1cps every other week. Not sure what to make of its future.

[BlackPeter]

Really does seem like a grim future and no hope in sight at this point... would it be best to cut losses and sell? Getting pretty fed up with it dropping 0.1cps every other week. Not sure what to make of its future.

Hi Regi, I am afraid this is a decision you need to make by yourself.

So far it looks like that BRL is able to survive another year or so off selling thermal coal into the inland market. One of their bigger customers (Westport cement factory) plans however to close down in mid 2016. Not sure whether BRL will be able to survive for a longer time after their closure. I guess it is not incomprehensible that they might find some other customer (but than, they might not ...).

Obviously - if coking coal prices recover by than, everything will be fine and they will be able to sell their coal to steel makers in Asia.

So - if you believe that the international coking coal prices will go up in a meaningful way (and the NZD stays down) during the next year or so, than they should be able to export their coal and it might be sensible to hold the shares.

If you believe however that international coking coal prices stay depressed for a longer timeframe or forever (they are currently at the lowest point for many years), than it is probably a good idea to sell.

As I said - the decision is yours - and just yourself to blame if you get it wrong

[Regi]

As I said - the decision is yours - and just yourself to blame if you get it wrong

Ah, If only I could tell what coal prices and China will do! lol. Nature of the game I suppose.

But thanks for all the info Peter, been a big help, cheers!

[trader_jackson]

I brought these at a ridiculous price (lets just say between 15 and 20 cents), and I did not to my research properly. Anyway, thats not the point (I have basically written it all off anyway now).

I do believe in the companies fundamentals long term: met coal price will rebound but it may take more than 1-2 years (more like 3-5 I think), and whether they can survive is more of a question for me (at the moment) that whether met coal prices will rebound.

Another capital raising 1-2 years down the track? (I am not sure on their borrowings... but I don't think they are to far in debt)

[BlackPeter]

Today's DomPost carries an article in which Jeanette Fitzsimons - remember her? - criticises Fonterra for powering certain of its plants by burning coal. Apparently, a switch to biofuels would be uneconomic - not surprisingly - and coal retains an advantage over gas at current prices. Author Gerard Hutching reckons "if not for dairy factories Australian coal miner Bathurst might find it hard to survive in NZ."

Article doesn't seem to be available on Stuff at present.

here it is:

http://www.stuff.co.nz/business/farm...cale-coal-user

I guess it is regurgitating the same half baked ideas the Greenies are so good in producing. Remember the recommendation to use homeopathic medicine to cure Ebola? Just funny that they are now promoting to introduce a foreign (and apparently harmless because "sterile") grass species into New Zealand in order to make some more coal miners redundant.

Yes - we do have an excellent track record of introducing foreign species into this country: gorse, pine, rabbits, possums, rats, humans ... so lets crown all these great experiments and spread "Giant miscanthus grass". Greenies obviously don't worry about reduced food production either. For sure it wouldn't reduce other crops - just trust the Greenies (anybody remembering Kaa's song?) - same as with the biofuel experiments in the EU which made the world wheat price skyrocket. Not a problem for the rich Europeans, and who is caring about the starving developing countries ...

OK - but I probably get here off subject. Looking at BRL do I not think that the article is material (well, not in the short to mid term). Introducing this new industry and growing the grass in sufficient quantities (if we really want to do that) would take a number of years. Building the drying facilities for the grass and modifying the heating facilities in the milk drying plants wouldn't happen over night either.

BRL's future is clearly not in providing thermal coal - but it is either selling high quality coking coal to steel producers (if the price is right) or alternatively it will be the exitus.

[digger]

I did try to make a point on this thread and got sort of shot down for it,but my points still stand. Yes I am very well aware of the difference between coking coal and thermal---see the old PIKE thread for that one about 100 times over so I need no lectures on that subject.
I ask you to think about what is happening in the world. Again the US and China have agreed to cut back on coal. China only agreed I would say because they well know their growth spurt is over and hence their future need for coking coal is greatly reduced. They are so big and hungry they effect the world supply/demand balance like no other country can.
End of story from me on this one. At 1/10 BRL current SP I do not consider they a buy. My thinking here is to save what you can,but as always do your own research.

[BlackPeter]

I did try to make a point on this thread and got sort of shot down for it,but my points still stand. Yes I am very well aware of the difference between coking coal and thermal---see the old PIKE thread for that one about 100 times over so I need no lectures on that subject.
I ask you to think about what is happening in the world. Again the US and China have agreed to cut back on coal. China only agreed I would say because they well know their growth spurt is over and hence their future need for coking coal is greatly reduced. They are so big and hungry they effect the world supply/demand balance like no other country can.
End of story from me on this one. At 1/10 BRL current SP I do not consider they a buy. My thinking here is to save what you can,but as always do your own research.

World coal consumption dropping? Really? I guess all the consumption charts I have seen are pointing steeply upwards (with a likely minor dent in 2014 - haven't yet seen the final numbers for 2014) - check out:

Coal consumption increased by more than 70% from 4 600 Mt in 2000 to an estimated 7 876 Mt in 2013. Demand grew 2.4% in 2013, up from 2.0% in 2012, though slow when compared to the ten-year trend, in which the compound average growth rate was 4.6%. But demand varied significantly according to geography: OECD non-member countries’ coal demand grew by 3.6% in 2013, while OECD demand decreased by 0.6%. Coal demand in Asian OECD non-member countries increased by 4.6% to an estimated 4 959 Mt; demand in the rest of the world decreased by 1.0% (-29 Mt) to an estimated 2 917 Mt.

from: http://www.iea.org/aboutus/faqs/coal/

But sure - these numbers are retrospective. Here is the most recent IEA prediction prediction:
http://www.iea.org/newsroomandevents...r-by-2019.html

Obviously - if you have something better from an respected organisation, than we would be interested.

Hi digger ... just wondering - did you forget to declare your interest? Why don't you try to put some facts on the table instead of just trying to scaremonger people by spreading warm fuzzies?

Discl: holding BRL (a small parcel);

[Billy Boy]

[QUOTE=BlackPeter;





Hi digger ... just wondering - did you forget to declare your interest? Why don't you try to put some facts on the table instead of just trying to[U] scaremonger people by spreading warm fuzzies? [/U]


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BB

[tony64peter]

Ah, If only I could tell what coal prices and China will do! lol. Nature of the game I suppose.

But thanks for all the info Peter, been a big help, cheers!

Regi Whilst I am a little biased re BRL, here's a link I follow daily and there appears to be a change in conversation of late, maybe short term maybe the bottom.
http://www.steelfirst.com/Scrap-and-...l-Archive.html

[BlackPeter]

[QUOTE=Billy Boy;573418]

scaremonger people by spreading warm fuzzies? [/U]


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BB

O.K. - I admit ... "warm fuzzies" typically have a positive connotation. Leave the fuzziness but pick a negative qualifier instead.

What I meant to describe is something which is negative (scare mongering), inaccurate (no measure supplied) and not consistent with the facts.

Help me here and give me a better word ...