full-time investing; total portfolio up over 130% in 2009; but 2010 sucks!
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KCL: Potash One Adds Cash, Production Viability With Buy
by Brian Truscott of Dow Jones Newswires
VANCOUVER (Dow Jones)--Potash One Inc. (KCL.T) received court approval this week for its takeover of Potash North Resource Corp. (PON.V), creating a C$105 million company with enough money to complete a feasibility study within a year, Chief Executive and President Paul Matysek told Dow Jones Newswires.
A new NI43-101 study will come out in early May, which "will be a blockbuster for more resource," he said.
Potash One's flagship Legacy solution mining project in Saskatchewan has 391.5 million metric tons inferred of potassium oxide (K2O) and 40.8 million tons indicated of K2O.
Potash, containing K2O, is used to ramp up crop yields.
A Legacy pre-feasibility study will be completed by late May, he said. The study will be based on a 2.5 million ton/year operation, but there will also be a study for a smaller operation, around 1 million tons a year.
"The good thing about solution mining is that it's scalable," he said. "We'll look at that, then start work on a bankable feasibility study in September. That might take six months to complete."
And if the costing and production figures make economic sense?
"The costs will be robust and the issue will be financing it," he said. "Our Legacy mine could supply 5-10 million tons of potash a year, but who is going to give us C$4 billion to build that?"
He said a smaller mine - 600,000 to 800,000 tons a year - would cost about C$800 million or less to build.
"This would be a good opportunity because (bigger) players aren't going to react over the appearance of another 800,000 tons a year," Matysek said.
Annual global potash production is about 55 million tons a year.
Competing With the Big Potash Players Of The World
There are a dozen big potash players in the world, with Saskatchewan home to the world's largest reserves and producers. The big three: Potash Corp. of Saskatchewan (POT), Mosaic Co. (MOS) and Agrium Inc. (AGU). These three companies are key potash price setters via a wholly-owned "trade association" called Canpotex.
The other big players, such as JSC Belarusian Potash Co., are based in Belorussia.
The big Canadian companies, plus newcomers such as BHP Billiton Ltd. (BHP), are working on billion-dollar greenfield potash mines as older mines fade away. Much of this build-out is being organically funded because financing from banks is problematic in flood-prone Saskatchewan, Matysek said.
Given limited market competition, prices haven't completely collapsed with the economic downturn. A ton of potash, which went from US$200 around 2006 to more than US$1,000 in 2008, now goes for about US$600 to US$800 a ton even though it costs about US$125 a ton to extract K2O from the ground.
Once his mine is in operation, Matysek plans to undercut the prices of majors.
"That's the only chance I have. I say, 'Look, if you don't do a deal with me and Canpotex makes a deal with me, you're just making your situation worse because it will have captured my supply,' " he said.
Company Web Site: http://www.potash1.ca
Brian Truscott, Dow Jones Newswires; 604-669-1595; brian.truscott@dowjones.com
April 17, 2009
BAC news includes many caution signs. (I wouldn't touch it with Wade's ten foot pole!)
07:15 BAC reports results above consensus for Q1
After preferred dividends, including $402 mln paid to the U.S. government, diluted earnings per share were $0.44 per share, may not compare to the First Call consensus of $0.04; revenues rose 111.7% year/year to $36 bln vs the $27.13 bln consensus. Co reports Pretax, Pre-Provision Income of $19
Bln. Co said, The Merrill Lynch integration is on track and expected to meet targeted cost savings. The Countrywide transition is on track. Cost savings from the acquisition are ahead of schedule. Merrill Lynch contributed $3.7 bln to net income, excluding certain merger costs, on strong capital markets revenue. Countrywide also added to net income as mortgage lending and refinancing volume increased. Credit quality deteriorated further across all lines of business as housing prices continued to fall and the economic environment weakened. Consumers are under significant stress from rising unemployment and underemployment levels. These conditions led to higher losses in almost all consumer portfolios. Declining home values, reduced spending by consumers and businesses and continued turmoil in the financial markets negatively impacted the commercial portfolio. Commercial losses increased from the prior quarter driven by higher broad-based losses in the non-homebuilder portion of the real estate portfolio within Global Banking and the small business portfolio within Global Card Services. The provision for credit losses of $13.4 bln rose from $8.5 bln in the fourth quarter and included a $6.4 bln net addition to the allowance for loan and lease losses. Reserves were added across most consumer portfolios reflecting increasing economic stress on consumers. Reserves were also increased on commercial portfolios. Nonperforming assets were $25.7 bln compared with $18.2 bln at December 31, 2008 and $7.8 bln at March 31, 2008, reflecting the continued deterioration in portfolios tied to housing. The provision for credit losses increased to $3.4 bln driven by economic and housing market weakness particularly in regions experiencing higher unemployment and falling home prices.
Europe and USFutures down. Bloomberg excerpt:
Companies from Bank of America Corp. to International Business Machines Corp. and Halliburton Co. are scheduled to report earnings today. Analysts estimate that profits at S&P 500 companies decreased for the seventh straight quarter in the January to March period, the longest stretch of declines since at least the Great Depression.
“We are not through this crisis by a long way,” said Howard Wheeldon, a senior strategist at BGC Partners LP in London. “We will now have a bit of a lull. Markets were wallowing in the known and now they are adjusting to a new world order,” he told Bloomberg Television.
02:27 AGU: Agrium mentioned positively in Barron's (40.06)
Barron's reports Agrium (AGU) could benefit as demand for fertilizer, which tends to track corn prices, is likely to rebound as the global economy improves. In the meantime, the co is expanding its network of more than 870 retail farm centers in North and South America, in order to help reduce its dependence on commodity prices. In addition, a battle for rival CF Industries (CF) may be distracting investors from Agrium's prospects. The stock trades for 6.8x this year's expected earnings of $6.1/share and 5.8x consensus 2010 forecast of $7.14, well below other fertilizer stocks -- and the co's historic multiple of 14x future EPS. The shares trade at 1.0 to 1.5x book value, less than half their five-year average. Agrium aims to have retail plus its tiny advanced-technology business chip in half of Ebitda in the future, and perhaps as much as 70% when fertilizer is in a slump.
'peekergram: Increased demand for fertilizer/potash may help KCL continue higher???
Thanks, basserdan, I think Gartman is one of the loud voices that many folks follow because they see the result of his public calls.
Gold now down to slightly below $870, so he was on the money with his short call, and his gold-shorting followers are in the money.
14:46 TGB Taseko Mines establishes a hedging program for ~50% of targeted copper production to the end of 2009 from its wholly-owned Gibraltar Mine (1.58 -0.03)
Co establishes a hedging program for ~50% of targeted copper production to the end of 2009 from its wholly-owned Gibraltar Mine. Co used a producer put and call option - a zero premium cost strategy. Approximately 30 million pounds of copper has been hedged with a price range of US$1.88 - US$2.36 per pound. Under the hedging program, Taseko will receive the prevailing market copper price while within the price range. Should the market price be outside the price range, Taseko will receive a minimum of US$1.88 and a maximum of US$2.36 for the hedged copper. The remaining estimated 30 million pounds of production is unhedged.
COVR vs. CNOA: Mindfart
Sorry, my comment was w.r.t. COVR not CNOA.
I corrected my email thusly.
I've been spending too much time in Kozuh's elevator...
COVR: I read the feature that their IR guy sent.
Snippet: Russell Cleveland, well known Texas investor, (thru his company) owns 16.2% of the shares of COVR.
Comment on COVR chart: Looking at daily chart for COVR, I'm struck by the low volume and extreme spread between hi and low per day, so beware of the risk that you will probably not be able to flip it easily for a quick profit and run on to the next great thing.
10:24 Gold stocks follow spot prices lower
Gold stocks are showing relative weakness with a selloff in spot gold prices (gold futures -11.50 at 881.50). The group is trading lower (GLD -1.0%), with notable weakness in the following individual names: AEM -4.3%, NG -4.2%, HMY -3.8%, AUY -3.3%, GOLD -3.0%, GG -2.8%, GFI -2.5%, NEM -2.4%, IAG -1.6%. The dollar is little changed, and there doesn't appear to be any other major news impacting the group this morning.
07:19 FEED: AgFeed Industries (FEED) announced its entry into a genetics program arrangement with Hypor, a Hendrix Genetics Company. Hypor is world renowned as a leading provider of superior swine genetics and technology. Hypor has, over the past 50 years, established itself to be one of the world's largest broad-based breeding pyramids supporting commercial producers in 25 countries...
Gartman negative on gold:
Yesterday on CNBC after market close, Dennis Gartman said he is long copper (expecting more buying by China) and "thinking about shorting Gold" if it goes up about $5 today.
Good luck goldbuggers,
'peeker
16:05 EGY:
Vaalco Energy provides update on Gabon Drilling Program (5.01)
The co provides an update on its exploratory well (N'Gongui-1) located onshore Gabon in the Mutamba concession and its new development well (EEBOM-3H) located in the Ebouri field offshore Gabon in the Etame Marin Block. The N'Gongui-1 well was drilled to a depth of approximately 4,100 feet. The objective reservoir, the Gamba sandstone, was encountered but was water-bearing. Accordingly, the well will be logged, plugged and abandoned. VAALCO also announced the successful completion of its second horizontal development well in the Ebouri field, the EEBOM-3H. First oil production occurred on April 8, 2009, and a new production record of 24,993 barrels of oil per day (bopd) from the Etame Marin block was set two days later. VAALCO expects production from the Etame block to average approximately 25,000 bopd.
CNEH: Positive comment on CNEH:
China North East Petroleum (CNEH.OB): This company grew revenues by close to 1000% between 2006 and 2009, as well as grew EPS by over 2400%, yet the stock trades at 1.5 P/E! and under book value.
http://seekingalpha.com/article/130705-the-happy-three-chinese-smallcaps-with-big-potential?source=yahoo
FEED is interesting (for a company that grows hogs and sells hogfeed). Their latest results do highlight the growth market that China provides, inasmuch as pork is the favorite meat of the majority of (Gentile) Chinese.
Yesterday's nice move is fading off a little today though, so it's not easy to figure out a target buy price.
Meanwhile I do ponder what they must do to dispose of all the byproducts (pigsh*t and lard)?
'peeker (admittedly with a negative bias toward American companies that grow pigs in China)
WFC: Hey Wade, Beware of continuing to hold.
10:02 Wells Fargo: 1Q09 beat on under-provision, credit trends deteriorate - Friedman Billings (18.66 +3.77)
Friedman Billings notes that WFC pre-announced 1Q09 EPS of $3 bln, or $0.55 per share, above firm's $0.25 est and the $0.23 consensus. The big difference vs. firm's model was the co's $4.6 bln provision, below firm's $6.25 bln est. While the mkt is reacting favorably to the EPS beat and the stronger tangible common equity ratio, firm remains cautious based on what they don't know. Most importantly, what happened to nonperforming loans and what would have been net charge-offs excluding purchase accounting adjustments? What are the trends in WFC's Option ARM portfolio? Did the co write up the MSR and what was the new capitalized cost of servicing? Was there any benefit from an increase in level 3 assets given recent accounting guidance? Firm hopes that these questions will be answered when the co reports results on April 22. Firm believes that credit quality materially deteriorated in Q1 and that WFC is under-reserving for expected future losses.
OK, Wade, you asked yesterday for one more big move in financials, so take your profit in WFC and BAC and run.
08:32 FCEL FuelCell Energy: Connecticut Department of Public Utility Control approves 27.3 megawatts of projects worth $84 mln (2.62)
The co announces that the Connecticut Department of Public Utility Control (DPUC) issued its final decision approving 27.3 megawatts of projects incorporating the co's highly efficient Direct FuelCell (DFC) power plants. The sales value of the projects will be $84 million when project developers finalize electricity purchase agreements and project financing. The approved projects include nine FuelCell Energy DFC3000 power plants: 3.4 MW DFC-ERG for a natural gas letdown station in Bloomfield, Conn.; 3.2 MW Direct FuelCell/Turbine (DFC/T) for a substation in Danbury, Conn.; 14.3 MW DFC3000 in Bridgeport, Conn.; 3.2 MW DFC-ERG in Trumbull, Conn.; and 3.2 MW DFC-ERG in Glastonbury, Conn. The Connecticut Clean Energy (CCEF) Fund recommended the five projects under Round 3 of Project 150, which requires Connecticut utilities to enter into Energy Purchase Agreements for 150 MW of clean power. With this latest approval, the DPUC will have approved 153 MW of projects including 43.5 MW of FuelCell Energy power plants.
APWR: booosh!!! A-Power Energy Generation Systems, Ltd. (Nasdaq: APWR) reports Q4 EPS of $0.30, cents better than the analyst estimate of $0.15. Revenue for the quarter was $81.4 million, versus the consensus of $75.91 million.
Sees Fy09 sales of about $290 million.
APT / AGT chart looks like backwards square root sign with that 6 cent dip in last half hour.
Goldman Says IMF Gold Sales to Have ‘Limited Impact’
(Last Updated: April 7, 2009 03:50 EDT )
By Stuart Wallace and Nicholas Larkin
April 7 (Bloomberg) -- The International Monetary Fund’s proposed gold sales are likely to have a “limited impact” on prices as they are countered by investment into exchange-traded funds and central bank purchases, Goldman Sachs Group Inc. said.
Gold fell below $900 an ounce after leaders from the Group of 20 nations said last week they would seek to help the world’s poorest countries using funds from the planned sales. The IMF’s board a year ago approved plans to sell 403.3 metric tons of bullion to shrink the Washington-based lender’s annual deficit.
“We would expect a potential sale under the current proposal could lower gold prices by 11 percent over the two to three years of a proposed sale,” Goldman said in a report dated yesterday.
A decision to sell gold requires the backing of 85 percent of the IMF’s executive board and would be subject to U.S. Congressional approval. The G-20 has asked the IMF to present “concrete proposals” at meetings later this month.
Gold for immediate delivery traded at $878.10 an ounce by 8:42 a.m. in London today. The metal is little changed this year after earlier gaining as much as 14 percent.
To contact the reporter for this story: Nicholas Larkin in London at nlarkin1@bloomberg.net
Commodities Update: Commodities Come Under Selling Pressure
The major equity markets momentarily pared losses, but have since fallen back toward lows seen earlier in the session. Commodities contracts are also showing general weakness... According to May futures, oil prices are currently down 2.5% to $51.20 per barrel as crude prices gyrate through negative territory. Meanwhile, natural gas is being priced 1.3% lower at $3.75 per contract... Gold is seeing particularly stiff selling pressure. Gold was recently quoted at $869.00 per ounce, down 3.0%. Gold prices are now down some 13% from their February high of $1,004.90 per ounce. Silver is also contending with a concerted selling effort. Futures contracts for silver are pricing the metal 4.3% lower at $12.19 per ounce... The Baltic Dry Index shed 1.3% amid weakness in each of its subindices. Panamax was the group's worst performer, dropping 3.6%. Dow -1.4%, Nasdaq -2.2%, S&P 500 -1.7%.
POE.v reason for drop appears to be the recently announced drop in average barrels per day production.
Everett Dirkson would be turning over in his grave.
"Of course, nowadays, billions ain't much!"
Wade, the Dow appears to have topped out for the day, and BAC is looking pretty weak right here; don't you think?
Perhaps today's FASB rules changes are the last real good news for awhile... one never knows what the next news will be.
Maybe buy on the rumor and sell on the news pertains here, too.
16:05 EVOL Evolving Systems announces plans for reverse stock split (1.27 -0.04)
Co announces that Directors have approved a reverse stock split of the Company's common stock. The reverse stock split is subject to stockholder approval. If the stockholders approve the reverse split, Evolving Systems' Board will have the authority to select a reverse stock split ratio of either 1-for-2, 1-for-3 or 1-for-4 so that, depending on the ratio chosen, either 2, 3 or 4 shares of issued and outstanding common stock will convert into one share of common stock. The exact timing of the reverse split will be determined by the Board of Directors based on its evaluation as to when the action will be the most advantageous to the Company and stockholders.
Congratulations, you cannot " ... always be wrong".
Nothing ill intended, just always thought your moniker was an overstatement, especially for a statistician.
'peeker
08:15 March ADP Employment Change -742K vs -693K consensus, prior -697K
Excerpts from Donald Coxe letter:
1. Larry Summers summed up equity performance with an even more doleful metric last week, saying that the US stock market, adjusted for inflation, was back to where it was during Lyndon Johnson’s Administration. That’s 35 years of zero real return.
Mr. Summers didn’t point out that gold has gone from $35 an ounce to $900 since LBJ introduced The Great Society.
2. Collateralized Debt Swaps proved to be the financial equivalent of what happened when the Sorcerer’s Apprentice got hold of the master’s book of spells...
AGT conf call Friday@11EST:
DENVER--(BUSINESS WIRE)--Apollo Gold Corporation (the “Company”) (TSX:APG - News) (AMEX:AGT - News) will be updating the market on the Black Fox construction and discuss the 2008 year end financial and operating results on Friday, April 3, 2009. The Company’s management will host the conference call at 9:00 AM MST (8:00 AM PST and 11:00 AM EST). The 2008 10-K and press release earnings report are available on the Company website at www.apollogold.com.
13:35 GRS
Gammon Gold announces discussions have terminated regarding proposed acquisition of Capital Gold (6.47 +0.25)
Co announces that discussions have terminated regarding the proposed acquisition of Capital Gold. The proposed acquisition was previously announced in the joint press release of Gammon Gold and Capital Gold on March 12, 2009.
12:00 CSIQ
Canadian Solar pops ~$0.50, strength attributed to intraday upgrade at Piper Jaffray (5.76 +0.48)
OT: About the survey ... WWNRNPJCD?
What Would Nouriel Roubini, Nancy Pelosi, and Jim Cramer Do?
09:59
FCEL: FuelCell Energy: News on order, approvals and partners will act as a positive catalyst - Janney Montgomery (2.26 -0.09)
Janney Montgomery notes that after attending FCEL's shareholder meeting late last week, the firm believes news on orders, approvals, and partners will act as positive catalysts for the stock over the next two months. The firm notes that the stock has been drifting down as its major projects have been awaiting approval, but they expect this to end. First, FCEL has been working on an order for 25+ MW from POSCO Power, and the co expects it to be signed in April. The co has also been working with Connecticut on finalizing Round 2 orders for 16 MW, which the firm understands are in the final stages of negotiation. The firm also expects Connecticut Round 3 to be approved by the CPUC on April 1st, most likely for 27 MW. The 68+ MW in the pipeline would be more than double the co's current production rate of 30 MW a year.
08:36 Chinese solar subsidy creates potential for a positive currency impact - Amtech
Amtech notes that while the Chinese solar subsidy remains difficult to quantify, it is clearly a long-term positive. Outside of a clear positive for demand, the firm views the potential currency impact as a major benefit for Chinese suppliers as demand begins to shift from Euro denominated regions to dollar denominated regions in 2010. A supply chain where demand center currencies are more in synch with input currencies will be a significant positive. The firm notes that solar is gradually moving along the same path wind did earlier this decade in terms of geographical demand. Demand centers in Europe are slowing, giving way to China and the US as the industry matures. The firm believes that the China stimulus will most likely accelerate this shift. Despite the recent volatility in the currency market, the USD/RMB pair has remained relatively stable, close to 6.80. The firm would expect this exchange rate to remain relatively stable in coming years as well given the US/Chinese debt relationship and the associated currency duration risk. The firm views more closely aligned currencies in the Chinese supply chain as an incremental positive for STP, JASO, YGE, SOLF, CSIQ, and TSL.
IMHO >>> No good reason to banish someone or judge them as "unworthy" of membership in any board here.
The IHub provides the ignore button with good results. When a conflict arises, it is less damaging to allow the conflict to defuse (by ignoring someone we don't want to read) rather than duke it out on the boards (the YAHOO behavior we hate).
We don't need VMC Junior Miners to become the exclusive club of only the few who are worthy and appreciated.
IMHO there are really only a few major contributors on this board. Lots of posts are of no use to anyone (e.g., The VMC Motherboard has waaaaay too many posts that are of very little value to some of us. The large number of posts on Pick6 contests and BTHB standings and pairoffs for the week; pure nonsense that has nothing to do with making the readers be better investors).
Everybody just relax ..... and use IGNORE if somebody's posts really piss you off. It works for me, and it works for those that ignore me (life is full of imperfect opportunities for mutually assured tolerance).
NO REASON TO BANISH ANYBODY unless they are repeatedly breaking IHUB codes of conduct.
IMHO, while I don't care to read all the oneliner posts saying what stock did what, Kozuh does occasionally post meaningful content, and other times I just enjoy his good humor (which takes some time to get used to, but certainly breaks up some of the monotony of watching CNBC and IHUB and stock charts all day).
'peeker
OT:
3/29 Kozuh.pk up -.333 Partial Inanity
HPCO: Interesting company with extremely good numbers, a cash cow like you said. Only downside risk is minimal, that is, that the owners take it under at a steep dicount, In other words, they have the insider votes to buy the entire remaining public float at a discount. In fact they have plenty of cash in the company's kitty right now to take it under rather than being magnanimous enough to share any dividends with non-insiders.
________________________________________________________
Found this quick summary on HPCO giving a bit more context to their operation (their coal ops consist of one mine which started in early 2007, so makes you wonder how much reserves and how long their mine will last):
Hallador Petroleum Company (Hallador) concentrates its efforts in the coal business. It sells all of its coal to producers of electric power. The Company has only one mine (Carlisle) and three mid-west electric utility customers. The Carlisle mine is located in western Indiana and was in the development stage through January 31, 2007. First commercial production began on February 5, 2007, and it sold 972,500 tons during the year ended December 31, 2007. In July 2007, the Company sold its San Juan gas properties. The Carlisle mine, located near the town of Carlisle in Sullivan County, Indiana, is an underground mine, which became operational in January 2007.
Hallador Petroleum Company
1660 Lincoln Street Suite 2700 Denver CO 80264
Phone: +1 (303) 839-5504
Fax: +1 (303) 832-3013
TGB had nice gain today, but down afterhours:
TGB -6.9% (Taseko Mines to sell 13.8 mln shares at C$1.45 each)
Well duh!! Your rumor source should not be trusted in future since results were posted today.
The report sounded OK, even with a small loss, as Black Fox ops are proceeding and the mill is still scheduled to begin ops in April.
Not sure what the posted results (small loss) will do to AGT price, but we'll know by Friday afternoon.
Just keeping fingers crossed that the mill begins ops without much complication so financial obligations can be met.
Gooooo AGT!!!
'peeker
bglpf.pk