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zigbee,
Thanks for the historical information for BIGN and Tyche.
I heard somewhere this morning that the water in the Gulf is extremely warm for this time of year. I guess it would be after such a mild winter.
If we have a strong hurricane season and a very hot summer, BIGN will increase in importance, on the supply and demand sides.
Also, with each passing day, we get closer to Peak Oil and Peak Gas. Investments such as BIGN are a form of insurance for our financial future. I'm sure that most Americans have not heard of any Peaks, other than debt. This is a tragedy.
Keep up the excellent work.
sumisu
Oil Price History and Analysis
"A discussion of crude oil prices, the relationship between prices and rig count and the outlook for the future of the petroleum industry."[/B]
This ia a long but worthwhile read; keep if for your files.
http://www.wtrg.com/prices.htm
sumisu
conservspec,
I'm losing just $250 on my 25,000 shares.
Hopefully I will have some dry powder available, if and when there is a correction.
Either way though, I will probably add to this position.
Added more to WHD.V today and plan to add to EMR.V soon.
These are my favorite penny stocks.
sumisu
West Hawk Announces New President,
Groundhog Agreement Approved
Thursday March 16, 3:05 am ET
VANCOUVER, British Columbia--(BUSINESS WIRE)--March 16, 2006--West Hawk Development Corp. ("West Hawk") (TSX VENTURE:WHD - News; FWB:H5N) is pleased to announce that Dr. William Mark Hart, Chief Operating Officer, has agreed to accept the position of President. Dr. Hart brings 30 years of coal mining and power plant operating experience to the company including several senior executive positions with multinational mining and energy companies including Cyprus Amax Minerals Corp., Newmont Mining Company, NRG Energy Inc, Sarcoal Energy Inc., and Consolidated Coal/Consol Energy. Michael Townsend will retain the role of Executive Chairman and Corporate Secretary. Chris Verrico will remain Chief Executive Officer.
In addition the company wishes to announce that it has entered into a formal letter of agreement with Anglo Pacific Group PLC ("Anglo Pacific") of London, England (LSE:APF - News; ASX:AGP - News) for the joint exploration and development of Anglo Pacific's and West Hawk's adjoining Upper and Lower Discovery coal licenses located at the Groundhog coal field in British Columbia, Canada. The formal agreement replaces the previously announced (January 11, 2006) memorandum of understanding.
The companies have formed a joint operating company, Discovery Creek Development Company (DCDC), consisting of four board seats and a Chairman. Each company will have equal representation on the board of directors with the chairman's role alternating on an annual basis. A phase one, 22 drill-hole development program has been approved by the boards of directors of both companies and is scheduled to begin in early April 2006.
The program will consist of the mobilization and construction of a semi permanent camp to base an initial low-impact helicopter supported drill program designed to advance known inferred and speculative category coal resources to measured and indicated categories as well as ascertain coal quality, quantity and geotechnical data necessary to facilitate the preparation of a feasibility study.
West Hawk has enlisted two veteran, professional mining engineering consultants to assist in the reserve estimation, mine design and economics for Groundhog. Dr. Andrew P. Schissler and Mr. Kenneth R. Server, who between them have been involved in the planning of over 90 coal, oil shale, and metal mining operations, internationally. Dr. Schissler worked in the mining industry for 27 years in technical and managerial positions before joining the faculty in Mining Engineering at Penn State University. Mr. Server has over 40 years of mine planning, design, and engineering experience as well as serving in a number of managerial positions with internationally recognized companies. Weir International, Inc., one of the world's most respected mining engineering companies, will oversee the Groundhog reserve evaluation, mine planning and economic analysis. SGS, the world's largest inspection testing and certification company of minerals/coal and trade commodities, will do the analyses.
The seams on West Hawk's Lower Discovery and Evans Creek properties alone comprise an inferred resource of 48,000,000 tonnes based on a few drill holes, having been outlined in a recently completed National Instrument 43-101 report produced by Don Wedman P.Eng. Additional resources are expected to be outlined by the exploration work on both Anglo Pacific's Upper Discovery and West Hawk's Lower Discovery Creek properties.
Dr. Wm. Mark Hart, President of West Hawk, explains; "Some of the world's highest carbon content coal lies within West Hawk's billion tonne speculative resource at the Ground Hog." Dr. Hart is considered an expert in Coal Mining having graduated with a PhD from the Colorado School of Mines and West Virginia University in mining engineering, later establishing records for production, safety and efficiency.
Anglo Pacific is a natural resources royalty company listed on both the London and Australian Stock Exchanges and currently receives royalty receipts from two coking coal mines in Queensland, Australia operated by Rio Tinto and BHP Billiton. In addition, Anglo Pacific has other private coal interests in the Groundhog district and also at Trefi in British Columbia. They also hold further private coal interests in Australia and maintain inter alia, substantial quoted equity stakes in a number of coal, uranium, gold and PGM mining projects in North America and Australia, including stakes in Cambrian Mining and Western Canadian Coal.
West Hawk is also pleased to announce that it has entered into advanced discussions with major mining and leading "clean coal" technology operators around potential Joint Venture for the development of its various coal assets. Potentials include the export of premium anthracite coal products in concert with environmentally responsible mine mouth coal gasification.
West Hawk is a mineral exploration and development company committed to building shareholder value through the development of its eight coal properties in Northern British Columbia and the Northwest Territories including plans to build an Integrated Gasification Combined Cycle (IGCC) electrical power plant, a coal-to-liquids (synthetic diesel fuels & naphtha) plant and a coal to pipeline quality synthetic natural gas plant.
The information contained in this news release, has been reviewed, approved and deemed reliable by Michael Sandidge P Geo., the qualified person.
ON BEHALF OF THE BOARD OF DIRECTORS
Michael Townsend, Chairman of the Board
This news release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the British Columbia Securities Commission and the United States Securities & Exchange Commission.
The TSX Venture Exchange has not yet reviewed and does not take re sponsibility for the adequacy or accuracy of the content of this news release.
West Hawk Development Corp. (TSX VENTURE:WHD - News; FRANKFURT:H5N - News)
Contact:
West Hawk Development Corp.
Michael Townsend
Chairman of the Board
(604) 669-9330 or Toll Free: 1-866-669-9377
Fax: (604) 669-9335
info@westhawkdevelopment.com
www.westhawkdevelopment.com
--------------------------------------------------------------------------------
Source: West Hawk Development Corp.
futrcash,
That was quite a synopsis of a busy and, I will add, a productive day.
Although my holdings are modest compared to many in this investment (only 435,000 shares), my enthusiasm might even now equal yours.
Being on site, moreover, was very smart of you and sharing your reports has been satisfying to all of us.
thanks,
sumisu
DR. MARC FABER
Dr. Faber is also known as Dr. Doom. He is a contrarian investor. I just began his book titled Tomorrow's Gold, Asia's age of discovery.
Last Friday, Dr. Faber was interviewed on ROBTv.com Here is a link: http://tinyurl.com/mhkl8
What is most important to us in this interview is his thoughts on the future of oil markets.
The entire interview is only 7 minutes, so give it a listen.
sumisu
futrcash,
Thanks for the compliment.
I feel very comfortable on this board and I intend to contribute much future natural gas/oil DD that will help fellow investors.
I'll leave the specifics of BIGN up to you and others who are closest to this investment.
I'm much closer to precious metals investments, but yet I feel that BIGN is somewhat "precious" too, especially in the Peak Oil and Peak Gas zones. Make no mistake, we are in those zones.
We have to realize that peak production means peak or much. The latter in conjunction with the extremely mild winter has given us a reprieve of serious energy price increases. That will change with the forthcoming driving and hurricane seasons. We still have not fully recovered from Hurricanes Katrina and Rita, and we might meet further setbacks soon.
The more I see the weather on the West coast, e.g., snow in LA, this La Nina "thingy" does not portend calm weather patterns down the road.
Hope that progress continues in Grimes.
sumisu
Hope this link works!
Interview of Henry Groppe; been in the energy business for 61 years.
http://tinyurl.com/gc6wm
sumisu
IF IT CAN HAPPEN OVER THERE, IT CAN HAPPEN HERE!
Earlier today I posted an article about England and its current natural gas shortage. I found another article containing more details behind this problem.
I have reached a general conclusion. If temperature do not fall below normal (or rise above normal) thereby boosting demand, if there were never equipment problems, if workers never went on strike, and if there was an abundance of all types of energy, then there would not be any energy problems.
But we will almost always encounter the following: erratic weather (e.g., hurricane season begins June 1); the energy infrastructure is wearing out and was not replaced adequately in the last 25 years when energy prices were so low; the energy sector has a lot of old timers, as this was not a sector to seek employment during the days of low energy prices; and finally we are reaching Peak Oil and Peak Gas.
Keep these factors in mind as you read the following article and then ask yourself, "is BIGN the right investment for the future?"
U.K. Gas Jumps to a Record Because Supplies May Not Meet Demand
March 13 (Bloomberg)
Natural-gas prices in the U.K. jumped to a record after supplies from Norway were curtailed, French gas workers went on strike and temperatures dropped below freezing, boosting demand.
Gas for delivery today at the National Balancing Point, the main U.K. trading hub, rose as much as fourfold to 255 pence a therm, according to broker Spectron Group Plc. The price is the highest since Bloomberg began tracking the market in 1999 and equals $33 per million British thermal units. A therm is 100,000 British thermal units. It was at 250 pence at about 2:30 p.m. London time.
Gas prices in the U.K., the European Union's biggest market for the fuel, can surge when weather turns colder or when fields malfunction. The Rough gas storage facility, the nation's largest, remains shut until at least May 1, cutting supplies about 10 percent. Gaz de France SA's shipments were slowed after workers opposed to its planned merger with Suez SA seized control of gas import terminals and storage facilities.
``It doesn't take much to squeeze the market with demand at this level and Rough out,'' said Lars Ekeland, an Oslo-based trader at Norsk Hydro ASA, Norway's second-largest oil and gas company. ``With Rough out, there's not much flex in the system.''
Gaz de France workers this morning seized control of two liquefied natural gas import terminals and eight gas storage terminals, the Confederation Generale du Travail said in an e- mailed statement.
National Grid Plc, manager of the U.K. pipeline network, issued the so-called gas-balancing alert for the first time since it started the system last year. The alert, published on the company's Web site, provides information that is designed to enable suppliers and buyers to react. Factories sometimes sell gas into a market when prices surge, curbing their own production.
Short
``The U.K. is still short of gas,'' Michael Allen, a power and gas trader at Inenco Group Ltd. in Lancashire, U.K., said in a phone interview today. Inenco buys about 400 million pounds of energy annually for customers such as Marks & Spencer Group Plc, the retail chain.
The minimum temperature today in London is minus 1 degree Celsius (30 Fahrenheit), compared with normal for the season of 3 degrees, according to data from Meteorlogix LLC on Bloomberg.
For the 24 hours through 6 a.m. tomorrow, gas supplies in the U.K. pipeline network are expected to fall to 285 million cubic meters from 294 million this morning, National Grid said on its Web site. Demand is forecast at 380 million cubic meters. That's 3 million cubic meters above the gas-balancing alert trigger.
The day-ahead price more than doubled to 165 pence from 59.85 pence on March 10. April gas rose 9.55 pence to 58 pence.
Troll Output
Statoil ASA, Norway's largest oil company, said today its Troll A platform in the North Sea was producing 10 percent below its capacity because of unspecified difficulties.
Malfunctions at the platform, which pumps a maximum of 110 million cubic meters of gas a day, had reduced output in February at Troll, the largest gas field in the North Sea. The field, which accounts for about 60 percent of the gas found off Norway's coast, was slated to resume full output on March 8.
Norsk Hydro said last week that production from the Oseberg field would remain at reduced levels during the weekend after faulty equipment curtailed production.
ConocoPhillips, the third-largest U.S. oil company, said it will shut its Ekofisk field in the North Sea for four days this week, halting some 600,000 barrels a day of oil and gas production.
About 375,000 barrels of crude oil a day from the Ekofisk area will be shut down in the early hours of March 17, Ingvar Solberg, a spokesman for ConocoPhillips in Norway, said in a telephone interview today. Gas production from Ekofisk and oil and gas from several neighboring fields also will be halted, bringing the daily production loss to about 14 percent of Norway's daily output
FUTRCASH,
Thanks for the update.
The link I'm providing does not relate to BIGN directly, but it does exemplify what might happen in the United States in the next heating season. It is being reported in England today that there is a shortage of natural gas.
I'm a believer in Peak Oil, Peak Gas, Peak Gold, Peak Silver, and Peak Copper. I think the time is near for all these peaks to occur. Among the largest driving forces is from the Far East where demand is putting great pressures on supplies of all commodities, especially energy.
This development in England in natural gas is accentuated by the declining availability of oil from the North Sea.
These factors indirectly make BIGN an important future player in the energy sector.
Here is the link:
http://business.guardian.co.uk/story/0,,1730310,00.html?gusrc=rss
sumisu
Illinois,
SLW should do very well over the next few years and beyond, as inflation accelerates.
I see silver outperforming gold and who knows what will happen to silver prices if a silver ETF is allowed!
sumisu
CHINA IS THE ANSWER
"Speaking of copper, this base metal has seen global demand quickly escalate in recent years. I wrote an essay on copper last fall analyzing its fundamentals while taking a look at its strategic trend as it continues to exceed all-time highs. Lending to this is the fact that yet again in 2005 global copper production was unable to meet demand. This is despite an estimated 3% growth in production for the year.
China’s voracious appetite for the metal has largely contributed to copper’s economic imbalance. This caused warehoused stockpiles around the world to fall alarmingly low throughout 2005 as overall inventories continue their sharp downward trends as they are gutted to supplement this rising demand.
Some industry experts, such as metals pioneer Ross Beaty, believe we may actually be approaching a Hubbert’s Peak for copper. Mr. Beaty cites many examples to support this theory including the fact that many of the large global copper mines have not only reached their threshold for expansion but will be exhausted in the next five to ten years. In addition to this he claims that only 56 new copper discoveries have been made in the last 30 years. This is hardly sufficient to keep up with growing global demand of which 2006 estimates are expected to exceed 17 million metric tons according to the International Copper Study Group.
Mr. Beaty also predicts that Chile copper production, which generates over one-third of all global mined copper annually, will reach its peak production in 2008. The famous Escondida and Chuquicamata mines in Chile together produce nearly 10% of global mined copper. When large mines like these exhaust their resources someday the only way to continue to keep up with global demand will be not only to mine lower-grade ore deposits but to make further major discoveries. The only way to encourage miners to make these discoveries and to sink more capital into mining will be for copper prices to continue to rise.
Mr. Beaty also brings up another excellent point that in addition to all of copper’s current industrial uses, the energy problems of the world will only add to its demand. Hybrid vehicles require four times as much copper as regular vehicles and alternative energy infrastructure requires significant amounts of copper to construct."
http://ragingbull.lycos.com/mboard/boards.cgi?board=CLB01229&read=5895
Ian Telfer Talks About Goldcorp's Future
By David J. DesLauriers
06 Mar 2006 at 06:25 PM EST
TORONTO (ResourceInvestor.com) -- Goldcorp’s [NYSE:GG; TSX:G] marketing motto has always been “Gold is money and Goldcorp is gold.” While this is the case, it is also true that mining is a business, and cash is king.
This is a point not lost on Ian Telfer and co. as they continue to monetize rock in the Americas. Indeed, it is their unparalleled cash flows that give Goldcorp the flexibility to now build production without diluting shareholders.
We interviewed Mr. Telfer at the Denver Gold Forum in September of last year, and titled the piece “Best of Breed Goldcorp Building Critical Mass,” a fitting description of our belief - and indeed the reality, that Goldcorp has outdone its peers across all of the key metrics.
When the Placer [NYSE:PDG; TSX:PDG] announcement came about a month later, we did another story entitled, “Goldcorp Just Keeps Getting Better,” which it does. The accretive acquisitions continue to roll in, and earnings, cash flow and reserve growth leave the majors in the dust. As a consequence, Goldcorp has and will continue to outperform. If the analysts can get their call on copper right, and place a greater emphasis in their targets on the importance of cash flow, rather than convoluted, inconsistent NAV formulas, share price targets should improve as well.
Please find the transcript below of correspondent David DesLauriers’ interview with CE Ian Telfer, which covers some pertinent questions that investors might have about the company’s recent activities.
RESOURCE INVESTOR: Virginia Gold [TSX:VIA] – When do we find out how much is there?
IAN TELFER: As you know they’ve done a lot of drilling, and it’s a spectacular deposit – the biggest exploration story of this cycle as far as I’m concerned. They never released a resource calculation, so we will continue to drill extensively, and we’ll be putting together a resource report – we haven’t closed the deal yet, so I don’t want to be too presumptuous, but I would say within six months we’ll be able to tell what’s there now. But we of course think, the reason we acquired it, we assume there is a minimum 4 million ounces there, and we think it could be considerably larger than that, but time will tell.
RESOURCE INVESTOR: La Coipa – Is anything going to happen there with Silver Wheaton [AMEX:SLW; TSX:SLW]?
IAN TELFER: Again, it’s a little too early to tell. We have Kinross [NYSE:KGC; TSX:K] there as a J/V partner, and so whatever we would do, we’d have to first come to an agreement with Kinross as to how they want to handle it, but its an interesting deposit, it does have a lot of silver, and Silver Wheaton has turned out to be a pretty good home for silver.
RESOURCE INVESTOR: 10% Wolfden [TSX:WLF] stake – The start of a trend?
IAN TELFER: Rob’s model was, when he saw something was getting interesting drill results, he would make investments in them, the difference is, we only do it when its right next door to existing operations. So his was more looking for new projects, ours is more consolidating what we have. Wolfden of course is right in Red Lake, they’re having some interesting results, so a relationship with them gives us pretty good insight into what’s going on. And then the Beaufield one we did as well, they are right next door to Virginia. So that’s the difference in the two approaches.
RESOURCE INVESTOR: Pueblo Viejo – What’s the game plan?
IAN TELFER: We’re not the operator, Barrick [NYSE:ABX; TSX:ABX] is, and also that deal hasn’t closed yet either, but we think it’s a great project, Barrick thinks it’s a great project, and once they get their hands on it, I’m sure they’re going to want to do a little bit of their own test work, etc. before they make a production decision, but I expect Pueblo Viejo will move ahead fairly quickly once Barrick gets control of it.
RESOURCE INVESTOR: Some debt on the books once these transactions are completed, is this it for a while on the deals front?
IAN TELFER: The mining business is so opportunistic that you have to be looking all the time. We have to look at where these orebodies are, and what’s available, etc. so we’re always looking. But as far as size is concerned, our objective was to build a mining company in a hurry to get up to 2 million ounces. We never dreamt that we could do it in four years. Now we’re there, and over the next few years we’ll get up to 2.6, 2.7 million ounces and I think today’s plan anyway is to stay between 2 and 3 million ounces, but look for Virginia type situations that will give us a mine life and reserve life that goes out for 20 years instead of 10 or 12 years like most mines. So the focus is going to be more on projects that are coming on in the future but are high quality assets, like Virginia. We still like North and South America as a hunting ground.
RESOURCE INVESTOR: Construction costs are rising and becoming prohibitive to development plays. Will this result in more Placer type deals of producing mines?
IAN TELFER: That’s an excellent question. The thing about buying producing mines is that you have the advantage that I think people can recognize over the last couple of years, that you know how much you paid. Some people might think you overpaid or whatever, but you know how much you paid.
Whereas, you’re right, with some of these development plays, especially over the last 18 months, costs have really risen drastically. My sense is that the worst part of this construction inflation has past. So you will be seeing people doing studies now aren’t going to get hit as hard as some companies did in the past.
Caterpillar isn’t going to be short of tractors forever, Firestone isn’t going to be short of tires forever. And it depends on the nature of the orebody, the one huge advantage that Goldcorp has is that every single one of our mines is on the local power grid. Also, most of our operations are underground, and underground mines just don’t consume the same amount of energy as large open pits for instance.
RESOURCE INVESTOR: Has your all-in acquisition cost target changed from $300? It seems that that is no longer a realistic figure.
IAN TELFER: The number has gone up. Everything has gone up, the operating costs everywhere have gone up, and the asking price for assets has gone up. But the Placer deal, they have cash costs at a couple of their operations which alone are at $300, but based on our knowledge of those assets, we think those costs are going to start to come down over the next few years, and they’ll never be low cost mines, but they’ll be better than they are now.
Simple math also, on the deal that we did with Placer. Our market cap at the time was about $7 billion, and we spent $1.5 billion, we doubled our reserves, we doubled our resources, and we increased our production, over the next couple of years, 80% - by spending 20% of our market cap on that deal. Also, because of our cash flow, we have the flexibility to not have to use shares, and so gold is up very nicely since the deal was announced, our transaction price hasn’t changed.
Penny Stock Profile . . .
West Hawk Development Corp.
(TSX Venture: WHD)
http://tinyurl.com/oss2u
Press Release Source: West Hawk Development Corp.
West Hawk Increases IR Contract, Meets Technology Partners and Announces Financing
Monday February 27, 5:54 pm ET
VANCOUVER, British Columbia--(BUSINESS WIRE)--Feb. 27, 2006--West Hawk Development Corp. (the "Company") (TSX VENTURE:WHD - News; FWB:H5N) is pleased to announce it has entered into a more comprehensive Investor Relations package with Value Relations of Frankfurt, Germany.
Value Relations is a full service Investor Relations firm with eight full-time employees and an extensive contact list of consultants able to deliver complete coverage of the emerging West Hawk story. The Company has elected to enhance the level of commitment to Investor Relations at an increased monthly package rate from $6,750 to $8,500 while extending the contract for an additional six months.
Technology Partners: The Company has just returned from a trip to Germany where Company COO Dr. Mark Hart gave a well received presentation on coal gasification technology and West Hawk's gasification opportunities at the well attended Stock Days Conference February 23rd and 24th in Frankfurt, Germany. The management team also met with senior representatives from Sasol-Lurgi, world leaders in coal gasification technology, the CEO of DBT, the largest manufacturer of underground coal mining equipment in the world, and the CEO of Eickhoff Bergbautechnik GmbH, a technology company specializing in high performance coal mining machines built in Germany.
The Company has also recently returned from touring Tampa light and Power's "Polk" Integrated Gasification Combined Cycle (IGCC) power plant near Orlando, Florida. The "Polk" IGCC plant is the first commercial plant of its kind built in the U.S., a 250 mega watt single train GE designed plant that is considered the lowest cost power producer on the Tampa Light and Power electrical grid. GE is one of several companies including Conocco Phillips, Shell Oil, and Sasol-Lurgi that all have competing technologies in the gasification and gas-to-liquids field.
Coal in the News: In recent public addresses by U.S. President George Bush, Alberta Premier Ralph Klein and Montana Governor Brian Schwietzer, Clean Coal technologies was addressed as being the energy future for both Canada and the United States. "There's enormous opportunity for one of the best economical, environmentally clean fuels of the future - and that's coal," Alberta Energy Minister Greg Melchin said. "Coal is and can be at the forefront of a clean environmental solution."
West Hawk management believes the coal gasification process is in the early stages of benefiting from the enormous movement in US policy to derive 75% of their petroleum needs from North American sources and the technology should experience a similar boom to the one currently underway at the Alberta tar sands. Anticipating this movement, West Hawk CEO Chris Verrico notes, "we want to tie up significant known coal resources in close proximity to infrastructure and load centres. The tar sands use an incredible amount of natural gas in their upgrading processes and we want to help supply those needs."
West Hawk Development Corp. is pleased to announce a private placement of up to 1,000,000 units at $0.50 per unit for gross proceeds of C$500,000 dollars. Each unit will consist of 1 common share and one share purchase warrant. Each whole warrant will entitle the holder to purchase one additional share of West Hawk at a price of C$0.60 for a period of 2 years.
The Company has also granted incentive stock options to directors, officers and consultants to purchase up to a total of 370,000 common shares in the capital stock of the Company, exercisable for a period of two years, at a price of $0.60 cents per share.
About the Company - West Hawk is a mineral exploration and development Company committed to building shareholder value through the development of it's Coal properties in Northern British Columbia.
ON BEHALF OF THE BOARD OF DIRECTORS
Michael Townsend, President and CEO
Tuesday February 28, 10:05 am ET
Press Release Source: Chariot Resources Limited
Chariot Files 43-101 For Mina Justa Resource Estimate
TORONTO, ONTARIO--(CCNMatthews - Feb. 28, 2006) - Chariot Resources Limited ("Chariot") (TSX:CHD - News) is pleased to announce that the 43-101 technical report for the resource estimate of the Mina Justa deposit will be filed on SEDAR today.
On October 20, 2005, Chariot announced that the Mina Justa deposit had Indicated resources of 132.4 million tonnes at a grade of 0.74% CuT and Inferred resources of 279.7 million tonnes at a grade of 0.57% CuT. The Indicated and Inferred resources have been determined using a 0.20% CuT cut-off. At this cut-off, the Mina Justa deposit contains 5.7 billion pounds of copper, 50.5 million oz of silver and 428,000 oz of gold.
The 43-101 technical report filed today was compiled by independent consultants, Snowden Mining Industry Consultants Inc.
Information contained in this press release was validated and reviewed by Robert William Baxter, BSc. Hons. App. Geology, Director, Executive VP, Chariot Resources Limited, the designated Qualified Person as defined in National Instrument 43-101.
Chariot Resources Limited (TSX:CHD - News) is developing its 70% owned Marcona Copper Project in Peru. With exceptional infrastructure, a significant resource and strong financial and commercial partners, Chariot's Marcona Copper Project is scheduled to be a mid-tier copper producer by 2009.
Additional details about Chariot can be viewed at the Company's website, www.chariotresources.com.
ON BEHALF OF THE BOARD OF DIRECTORS OF
CHARIOT RESOURCES LIMITED."Alex Black"
Chairman
Is a New World Order Evolving? A Shift From Dollars to Euros & Gold Will Impact You
By Jay Taylor
27 Feb 2006 at 01:46 PM EST
WOODSIDE, NY (MiningStocks.com) -- Some very rapid changes are taking place that threaten the world order as we know it. In addition to Congressman Paul's speech and discussion of our budget deficits, several headlines caught my attention this past week that illustrate these changes.
For example, we see China Daily reported on Friday that China is seeking to quickly finalize a $100 billion energy deal with Iran before the U.S./U.N. puts sanctions on that country, allegedly related to its uranium enrichment activities.
Then we learn that the Indian central bank was a big buyer of gold this past week.
Meanwhile, Germany, which used to be one of the big gold selling countries during the heydays of gold manipulators up until about 2002, is saying no more central bank gold sales, and apparently Deutsche Bank doesn't like that much. If you wonder why that would be, all you have to do is go back and read some of what the Gold Anti Trust Action Committee has been saying about Deutsche Bank's activities as one of the anti-gold bullion banks who were defendants in Reginald Howe's anti-gold manipulation lawsuit. Deutsche Bank rather likes the fascist economic policy of government bailing out big corporations, at least when it is the big corporation.
There has been rumor after rumor of central banks now buying gold. Remember when Argentina flipped the U.S. and the U.K. and their owned and manipulated institutions, the World Bank and IMF, the bird by taking some of their precious dollars and buying gold rather than paying back dollar-denominated loans?
Another factor that has been buried "on page 100" so to speak in the New York Times is the fact that Iran is planning to establish an Iranian oil market and will settle oil transactions in euros rather than dollars. And so Iran is defying the U.S., as did Saddam Hussein before that act was turned around with a war. As soon as the U.S. took over Iraq, that promptly reestablished the U.S. dollar in place of the euro. Dr. Krassimir Petrov makes the point in a paper he wrote on January 20, 2006: "The American Empire depends on the U.S. dollar. The proposed Iranian Oil Bourse will accelerate the fall of the U.S. dollar and hence the fall of the American Empire."
I have had some communications with Dr. Petrov and hope to interview him for an upcoming issue of both our gold and energy newsletters. But his view is one I have held for quite some time. What gives the U.S. dollar value is increasingly suspect and non-existent, given our huge and growing trade deficits. The manipulation of the gold price downward helped provide an illusion of a strong dollar during the Clinton years. And to Clinton's credit, he was much more responsible than our current President is proving to be on the fiscal front. But make no mistake, a huge reason why the dollar retains its value is that something like 80% of all international trade is settled in dollars. Think about the billions of dollars daily in oil and other commodities, not to mention financial transactions around the world. Were it not for the dollar being the world's reserve currency, it would have collapsed long ago.
With the fundamental underpinnings of the dollar becoming increasingly suspect, we see more and more countries seeking to "diversify" their foreign currency holdings not only into euros and yen, but quietly and surely into gold. Some countries like China are doing all they can to encourage their citizens to buy gold, even as Wall Street stupidly and ignorantly looks at the yellow metal as a barbaric relic. That's because Wall Street can reallocate wealth from the rest of the world much more rapidly through the systemic theft of fiat money than it can through honest, hard work. Our corrupt fiat money system is serving to damn our nation by bidding the best and brightest talent in America away from Main Street, where they used to work creating and building products that enrich lives rather than engaging in speculative activities that falsely promise we can get rich without working.
As the world begins to shun the dollar, how will policy makers react? We need nearly 3 billion per day to keep our economy from deflating. Until now, foreigners have been willing to lend us that money, but there are signs that may be coming to an end. What will Bernanke do then? Will he raise interest rates (decrease the money supply) to keep foreigners sending their capital to us? Or will he try to print more money so there is enough "liquidity" to keep the U.S. economy going? Neither choice is very appealing. If "Helicopter Ben" prints more and more money, we face the prospects of a flight from the dollar and skyrocketing interest rates that will require faster and faster printing with the risk of some sort of hyperinflation. On the other hand, if he tightens the money supply (increases rates) with Americans much more heavily indebted now than we were before the 1929 crash, we face the prospects of the K-winter.
Ultimately, we get the K-winter. Of that I have no more doubt than I ever had. The question we need to face now is whether we have several more "good" years of inflation, during which time to join the inflation party, which allows those who see what is coming to allocate wealth from the naïve, who do not see what is going on. Or, will Helicopter Ben's printing presses not perform as he has promised, in which event we bite the dust in a deflationary collapse? Which way we go makes all the difference in terms of what kind of things we want in our Model Portfolio and is why I continue to pay so much attention to our Inflation/Deflation Watch.
I don't know which way this increasingly vulnerable economy will tip in the shorter term, but what I do sense is that the establishment may very well be losing control of the situation and that we could have some earth shattering geopolitical changes in the not-too-distant future that could send Americans into poverty at a very rapid rate.
© J. Taylor's Gold & Technology Stocks 2006
J.Taylor's Gold & Technology Stocks is published monthly as a copyright publication of Taylor Hard Money Advisors, Inc. THMA provides investment advice solely on a paid subscription basis. Companies are selected for presentation in this publication strictly on the merits of the company. No fee is charged to the company for inclusion.
starboy,
You hit it on the head, the unknown geopolitical events, such as the Saudi attack last Friday. BUT add to this factor Peak Oil and Peak Gas, then this investment is like an insurance policy.
I'm reading a book that is hot off the press titled THE COMING ECONOMIC COLLAPSE, How You Can Thrive When Oil Costs $200 a Barrel. Stephen Leeb, PhD is the author. I encourage everyone to read it, as it will provide direction for future investments and it points out the potential havoc that will be created by $200 oil.
As I sit comfortably at my PC typing out this message, I wonder what will be happening in the next two years. I'm not optimistic. However, I know that there are companies like Biogenerics that are trying to create that energy supply that we will need in the future. Put in this perspective, this investment has widespread importance.
sumisu
zigbee,
Thanks for your post and accompanying website.
We will get there.
sumisu
futrcash,
I've known you for six years now.
On compliment I can pay you is that your due diligence is totally complete. When it comes to walking the extra mile, you walk two extra miles. (I too call other companies regarding my investment; don't call BIGN, as I know you have it covered.)
I'm in BIGN with you. I just have 200,000 shares and I'm willing to wait. This stock will be a winner with patience. It becomes a no brainer when you factor in the epochal change of PEAK OIL.
By the way, I'm holding you personally responsible for getting me into AMEP and cashing out with $35,000 profit. The profit went into BTU which split Thursday; I now have 1,000 shares.
Unfortunately I sold out of RTK and CWPC too early, made a good profit, then bought them back after reading more books on Peak Oil and the articles that you shared with me.
take care and thanks for the help,
sumisu
MORE RESULTS
Chariot Encounters Cu Intercepts Of 18 Metres At 6.26%, 12 Metres At 10.66%, And 8 Metres At 6.70% From HG Sulphide Zone
Thursday February 23, 9:55 am ET
TORONTO, ONTARIO--(CCNMatthews - Feb. 23, 2006) - Chariot Resources Limited ("Chariot") (TSX:CHD - News) is pleased to announce additional results from the feasibility study drill program for the Mina Justa deposit located at its Marcona Copper Project in Peru. These results were not available at the time of the press release of February 21, 2006.
The additional results outlined are from the HG Sulphide zone. The HG Sulphide zone has both copper oxide mineralization and sulphide mineralization with both types often occurring in the same drill hole.
Notable additional drill intercepts from the HG Sulphide zone that were not available for inclusion in the February 21, 2006 press release are:
- 138 metres of high grade oxide and sulphide mineralization including:
-- 24 metres at above 0.65% Cu copper oxide mineralization, and
-- 114 metres at 3.05% Cu copper sulphide mineralization (which includes 12m of internal dilution), including
--- 18 metres at 6.26% Cu, and
--- 12 metres at 10.66% Cu, and
--- 8 metres at 6.70% Cu
The results released on February 21 came from 18 out of the first 35 holes drilled since the start drilling at Mina Justa. The results released today come from hole MJV-06-039 which is situated 60 metres southwest from a hole MA-064 which was drilled by previous owners Rio Tinto, 50 metres southwest from MJV-06-035 and 100m south of MJV-06-031. The results from holes MJV-06-031 and MJV-06-035 where released on February 21, 2006.
Consistent with previously reported results, all intersections were determined using a 0.25% Cu cut-off and less than 2 metres of internal waste. Higher grade intersections were calculated using a 1% Cu cut-off and less than 2 metres of internal waste. All intercepts are down-hole length and intersection true widths have not been calculated.
Sampling procedures for the current drilling program are the same as previously reported and in summary: All RC chips are logged at the Marcona project site. Holes are sampled in their entirety in two metre runs and split at the drill site. A 1/8 split or approximately 5 kilograms of a two metre sample is submitted to the on-site SGS Lakefield Research ("SGS") preparation facility where samples are crushed to 95% passing 10 mesh and riffle split from which a 250 gram sub-sample is taken. The sub-sample is submitted to SGS, in Lima, for analysis. The coarse sample prep reject is bagged and stored on site and following analysis the analytical pulp sample is returned to Chariot for on-site storage.
All samples are analyzed for copper (Cu) using sequential leach resulting in four Cu analyses per sample (Cu total, Cu soluble in sulphuric acid, Cu soluble in sodium cyanide and a Cu residual). Gold is sampled using a 30 gram Fire Assay with an AA finish. Sulphide samples are submitted for 38 element ICP analysis with aqua-regia digest. Quality control procedures include insertion of certified project standards at the drill site (1 in 20), field duplicate samples (1 in 20), laboratory duplicates (1 in 20) and reagent blanks and reference material (1 in 20).
Data contained in this news release was validated and intersections calculated by Robert William Baxter, BSc. Hons. App. Geology, Director, Executive VP, Chariot Resources Limited, the designated Qualified Person as defined in National Instrument 43-101,
Mr. Alex Black, Chairman, said, "The results from hole MJV-06-039 appear to extend the very high grade core of the HG Sulphide zone. This zone was initially encountered by previous project owners, Rio Tinto. Wide spaced drilling by Chariot last year extended the zone to about 400 metres by 600 metres. This latest hole does not appear to extend the overall size of the HG Sulphide zone but it does appear to extend the very high grade core that is part of this zone".
Chariot Resources Limited (TSX:CHD - News) is developing its 70% owned Marcona Copper Project in Peru. With exceptional infrastructure, a significant resource and strong financial and commercial partners, Chariot's Marcona Copper Project is scheduled to be a mid-tier copper producer by 2009.
Additional details about Chariot can be viewed at the Company's website, www.chariotresources.com.
ON BEHALF OF THE BOARD OF DIRECTORS OF
CHARIOT RESOURCES LIMITED."Alex Black"
Chairman
INTERNATIONAL URANIUM CORP. DEVELOPMENT
Option Agreement Signed With International Uranium Corporation on Sims Lake Property, West Central Labrador
Thursday February 23, 8:30 am ET
VANCOUVER, British Columbia, Feb. 23, 2006 (PRIMEZONE) -- Consolidated Abaddon Resources Inc. (Vancouver:ABN.V - News) and International Uranium Corporation (Toronto:IUC.TO - News) are pleased to announce that an Option Agreement has been signed between the companies pertaining to Consolidated Abaddon's Sims Lake minerals claims (the Property) totaling 4,390 hectares located northwest of Churchill Falls in west Labrador, Canada.
IUC has been granted the sole and exclusive right and Initial Option to acquire a 51% interest in the uranium rights to the Property over a period of 2 years, subject to regulatory approvals. As consideration for the grant of the Initial Option, IUC shall pay Consolidated Abaddon the sum of $20,000 and incur exploration expenditures in the amount of $225,000 on or before January 2007, and pay the sum of $20,000 and incur exploration expenditures in the amount of $225,000 on or before January 2008. The funds to be expended in this Initial Option Agreement are to be used for a drill program to test airborne and ground conductors discovered earlier by Consolidated Abaddon. It is expected that this drill program will commence by the middle of May 2006.
Provided IUC has exercised the Initial Option, IUC shall be entitled to acquire an additional 24% interest in the Sims Lake property to bring its total interest in the Property to 75%. As consideration for the grant of the Second Option, IUC shall incur exploration expenditures on the Property of $1,000,000 on or before January 1, 2010.
The parties acknowledge that IUC may spend greater than the annual requirement specified which over expenditures shall be applied to future earn-in requirements.
Consolidated Abaddon shall maintain a 2.0% net smelter Royalty over the Property. IUC shall have the right to purchase 0.5% of the Royalty for the sum of $500,000 up to a maximum of 1% of the Royalty exercisable any time prior to, or within 30 days of IUC formally approving commercial development of the Property.
It is the intent of Consolidated Abaddon and IUC that they will negotiate, in good faith, and enter into a formal Option Agreement within 30 days of this agreement.
The Sims Lake property covers parts of the known Sims Group where uranium was discovered near the Sims-Knob Lake Group unconformity in the early 1980's. The Sims Group is a flat lying clastic sequence of late Proterozoic age that overlies deformed sediments of the early Proterozoic Knob Lake Group. The similarity in ages and relationships between these groups of rock makes the setting analogous to many other Proterozoic basins around the world that host 'unconformity-type' uranium deposits, most notably the Athabasca Basin of Northern Saskatchewan. The depth to the unconformity in the Sims Lake basin, however, is only 50 to 150 meters deep.
Map: http://www.consolidatedabaddon.com/i/maps/simsgeomap.jpg
Consolidated Abaddon acquired this property in the winter of 2004-2005 for the purposes of expanding their search for uranium assets. An airborne radiometric and electromagnetic survey conducted by the Company in July 2005 identified conductors that are interpreted to lie in Knob Lake Group rocks underlying the Sims Group. Consolidated Abaddon completed in October 2005 a ground evaluation of uranium targets consisting of a detailed scintillometer survey, a VLF survey, and detailed prospecting and mapping. Numerous boulders of fractured, gossanous graphitic sediments of the Knob Lake Group containing elevated uranium values were responsible for the bulk of the radiometric anomalies from the airborne survey. Of particular significance was the ground truthing of an airborne electromagnetic conductor located at the base of the Sims Group.
Consolidated Abaddon Resources Inc. is a Canadian uranium exploration company actively involved with the development of uranium properties in the ATHABASCA BASIN of northern Saskatchewan and the SIMS BASIN of west Labrador. The Company is also developing a gold property in the RED LAKE MINING DISTRICT of northwestern Ontario.
For further information on Consolidated Abaddon Resources Inc. (Vancouver:ABN.V - News), visit the Company's web site at http://www.consolidatedabaddon.com.
ON BEHALF OF THE BOARD OF DIRECTORS
"Jim Pettit"
James G. Pettit
President
For further information contact myself or:
Don Myers
Consolidated Abaddon Resources Inc.
Director
Telephone: 604-687-3376
Toll Free: 800-567-8181
Facsimile: 604-687-3119
Email: info@consolidatedabaddon.com
SPLIT INFO - CCJ
Cameco splits before market open (2/23/05) (2:1 ratio)
YAMANA & DESERT SUN
Combination of Yamana and Desert Sun Creates Leading Intermediate Gold Producer
Wednesday February 22, 12:01 am ET
TORONTO--(BUSINESS WIRE)--Feb. 22, 2006--Yamana Gold Inc. (Yamana) (TSX:YRI - News; AMEX:AUY - News; LSE (AIM):YAU) and Desert Sun Mining Corp. (DSM) (TSX:DSM - News; AMEX:DEZ - News) today announced a transaction which provides that Yamana will acquire all of the outstanding common shares of DSM in exchange for Yamana common shares. DSM shareholders will receive 0.6 of a Yamana common share for each DSM common share held. Based on the 5-Day weighted average of Yamana's share price, the transaction price is C$5.47 per DSM common share, representing a premium of 21.1% over the 5-Day weighted average price of DSM's common shares. DSM owns the long-life Jacobina gold mine in Bahia, Brazil near Yamana's Fazenda Brasileiro mine and its C1 Santa Luz pre-feasibility project.
The transaction results in Yamana becoming a leading intermediate gold producer with the following profile:
- Estimated annualized gold production of 450,000 ounces in 2006 increasing to 700,000 ounces in 2007 and to more than 800,000 ounces in 2008 from operating mines and mines under construction (includes expansion plan for Jacobina Mine proposed by Desert Sun and excludes near development stage projects held by Yamana)
- Total resource base of approximately 11.6 million ounces of measured and indicated resources plus inferred resources of approximately 6.1 million ounces
- Proven and probable reserves of approximately 7.6 million gold ounces (included in above measured and indicated resource total above)
- Proven and probable copper reserves of approximately 2.3 billion pounds
- Cash costs projected at US$270 per ounce of gold in 2006, with US$125 and US$115 per ounce of gold projected for 2007 and 2008, respectively
- One of the largest Brazilian exploration land holdings with a significant presence in three major gold belts
The transaction provides the following anticipated benefits to Yamana and DSM shareholders:
- Creates an intermediate gold producer with one of the largest production growth profiles
- Increases operational strength and management depth
- Facilitates operational and administrative synergies
- Results in a company with further growth potential from existing development-stage assets and better positioned to take advantage of additional acquisitions
- Broadens shareholder base and increases share liquidity
The transaction is accretive to Yamana in terms of net asset value and longer-term earnings and cash flow per share. DSM shareholders will benefit from an attractive premium and the opportunity to participate in the future growth of the combined company.
Increased Profile
Peter Marrone, President and Chief Executive Officer of Yamana said, "In our strategic vision which we articulated in late 2005, our goal was to produce 750,000 ounces of gold by 2008. With this acquisition, we will exceed that goal. As a result of this increased production profile and with the advancement of our development-stage or near development-stage assets, we are now targeting production of 1.0 million ounces by 2008. The purchase of Desert Sun adds a large-scale, long-life operation to Yamana's existing operations. The Jacobina Mine is near our existing operations in the State of Bahia in Brazil. The resulting synergies created by combining the Jacobina Mine with our existing operations in Bahia are tremendous. Further, the addition of the 150-km long Bahia Gold Belt's exploration potential will contribute to further growth. With the new production profile, Yamana will be one of the largest intermediate producers with projected future cash costs among the lowest in the industry. Our combined market capitalization is well below that of our peers and so we see significant upside value in the shares of the combined company."
Bruce Humphrey, President and Chief Executive Officer of Desert Sun said, "From the perspective of a Desert Sun shareholder, the transaction provides an attractive premium while still maintaining significant upside exposure. Further, it provides diversification from being a one-mine company and it combines the strength of two respected operating teams. We are confident that Yamana's shares represent good value and that we will participate in the upside through share ownership in the combined company."
Summary of the Transaction
The acquisition of DSM will be completed by way of a court approved Plan of Arrangement whereby each DSM common share will be exchanged for 0.6 of a Yamana common share. All DSM options and warrants will become exercisable for common shares of Yamana based on the exchange ratio. As a result of the proposed transaction, the combined company will be held approximately 76% by existing Yamana shareholders and 24% by existing DSM shareholders. The total number of Yamana common shares outstanding would be approximately 262.1 million, on a pro forma basis after giving effect to Yamana's previously announced acquisition of RNC Gold Inc. The transaction values DSM at approximately US$500 million on a non-diluted basis.
The acquisition has the unanimous approval of the Boards of Directors of Yamana and DSM. The Board of Directors of DSM, having received the unanimous recommendation of a special committee of directors, is recommending that holders of DSM common shares vote in favour of the transaction. GMP Securities L.P. provided an opinion to the special committee of the board of directors of DSM that the business combination is fair, from a financial point of view, to the holders of common shares of DSM.
Yamana has agreed with DSM that Bruce Humphrey (DSM President and CEO) and Stan Bharti (DSM Chairman) will join its board of directors. It is expected that Yamana's management team will be supplemented with the addition of certain officers from DSM to whom Yamana intends to extend offers of employment.
Commenting on management, Peter Marrone said, "We have a very capable management team and we welcome new additions to that team. The operational depth of the company will increase and better position us for further growth."
The transaction is subject to all requisite regulatory and court approvals, third party consents and other conditions customary in transactions of this nature. The combination must be approved by at least two-thirds of the votes cast by shareholders of DSM at a meeting of holders of common shares of DSM. The shareholder meeting is expected to be held on March 31, 2006, with the transaction anticipated to close shortly thereafter.
If the combination does not occur under certain circumstances, DSM has agreed to pay Yamana a break-fee of C$21.5 million.
Yamana's financial advisor is National Bank Financial Inc. DSM's financial advisor is Sprott Securities Inc. and its special committee of directors is being advised by GMP Securities L.P.
About Yamana
Yamana is a Canadian gold producer with significant gold production, gold and copper-gold development stage properties, exploration properties and land positions in all major mineral areas in Brazil. With the acquisition of RNC Gold, Yamana also owns two producing mines in Central America. Yamana expects to produce gold at intermediate company production levels in 2006 in addition to significant copper production by 2007. Company management plans to continue to build on this base through the advancement of its exploration properties and by targeting other gold consolidation opportunities in Brazil and elsewhere in Latin America.
About Desert Sun Mining
Desert Sun Mining is a Canadian gold mining company listed on the Toronto Stock Exchange and the American Stock Exchange with 100% ownership of the Jacobina Mine and the 155 km long Bahia Gold Belt in the state of Bahia, in northeastern Brazil.
Ed,
Have you ever looked at Emgold, EMR.V?
This is a gold play in California. There are a number of interviews on this company's web site that are worthwhile for DD.
http://www.emgold.com/s/Home.asp
What I particularly like about Emgold is that they have a technology whereby the mining debris can be used to make high quality ceramic tiles. These tiles will be marketed by a subsidiary.
http://goldenbearceramics.com/
thanks,
sumisu
Czech,
Thanks for the tips; I have been tracking CUP for a while, but lack the funds to buy right now.
I have investments that I call sock draw investments, i.e., they have potential, but are still aways off.
The first is WHD.V, White Hawk, which is the only anthracite coal play that I know of under a dollar. In 90 days, I expect this to be a company on the move, stemming from a winter drill program. The web site includes a good interview.
http://www.westhawkdevelopment.com/
The second is CHD.V, a copper play. This was recommended by George "Zapata" Black. The company announced drilling results today and I posted it on the Chariot Resources Ltd. I-Hub board. Here is the web site, as well.
http://www.chariotresources.com/
The third is EMR.V, a unique gold play in California. There are a number of interviews on this company's web site that are worthy of your attention.
http://www.emgold.com/s/Home.asp
What I particularly like about Emgold is that they have a technology whereby the mining debris can be used to make a high quality ceramic tiles. These tiles will be marketed by a subsidiary.
http://goldenbearceramics.com/
As I indicated, these are sock drawer picks, but I like to get in on some good investments in their early stages.
Good luck.
sumisu
Tuesday February 21, 9:47 am ET
Chariot Encounters Cu Intercepts of 50 Metres at 3.50%, 12 Metres at 5.09%, 28 Metres at 1.68% and 24 Metres at 1.58% From Initial Feasibility Drilling at Mina Justa
TORONTO, ONTARIO--(CCNMatthews - Feb. 21, 2006) - Chariot Resources Limited ("Chariot")(TSX:CHD - News) is pleased to announce initial drill results from the feasibility study drill program for the Mina Justa deposit located at its Marcona Copper Project in Peru.
Drill results outlined are from the Northern Oxide and HG Sulphide zones.
The majority of the drill results outlined come from the proposed starter pit area located in the Northern Oxide zone. The Northern Oxide zone comprises copper oxide mineralization from surface to a depth of approximately 200 metres. The HG Sulphide zone has both copper oxide mineralization and sulphide mineralization with both types often occurring in the same drill hole.
Notable copper oxide intercepts from the proposed starter pit area in the Northern Oxide zone are:
- 36 metres above 0.95% Cu, including 12 metres at 5.09% Cu and 12 metres at 3.27% Cu;
- 96 metres above 0.92%, including 28 metres at 1.68% Cu;
- 90 metres above 0.57% Cu, including 34 metres at 1.34% Cu and 24 metres at 1.58% Cu;
- 12 metres at 1.42% Cu;
- 6 metres at 2.53% Cu;
- 72 metres above 0.48% Cu, including 50 metres at 0.79% Cu;
- 50 metres above 0.84% Cu, including 16 metres at 0.95% Cu;
- 12 metres at 2.19% Cu
Based on the drilling results received from the starter pit area, Management believes that the starter pit may be larger than previously estimated. Follow-up drilling is planned to evaluate a possible expansion to the starter pit area for the feasibility study.
Notable drill intercepts from the HG Sulphide zone encountered during this initial in-fill drilling program were:
- 184 metres of oxide and sulphide mineralization including:
- 96 metres above 0.64% Cu copper oxide mineralization, and
- 10 metres at 1.91% Cu copper sulphide mineralization, and
- 78 metres at 2.90% Cu copper sulphide mineralization, including
- 50 metres at 3.50% Cu
- 152 metres of oxide and sulphide mineralization including:
- 76 metres above 0.51% Cu copper oxide mineralization, and
- 20 metres at 1.70% Cu copper sulphide mineralization, and
- 56 metres at 2.27% Cu copper sulphide mineralization including
- 8 metres at 3.60% Cu
- 4 metres at 4.80% Cu
On January 23, 2006, Chariot announced that feasibility study drilling had commenced at Mina Justa. Since then, a total of 11,393 metres of drilling has been completed, including 10,057 metres of reverse circulation drilling and 1,333 metres of diamond drilling. Core from diamond drilling will be used for additional metallurgical testing.
The feasibility study drilling planned at Mina Justa during 2006 will comprise approximately 34,000 metres. The results released today come from 18 out of the first 35 holes drilled since the start drilling. Detailed results from individual holes will be released on the Company's web site.
On October 20, 2005, Chariot announced that the Mina Justa deposit had total measured, indicated and inferred resources of 412 million tonnes at 0.62% Cu containing approximately 5.7 billion pounds of copper, 50.5 million ounces of silver and 428,000 ounces of gold. Those results were based on 70,212 metres of exploration drilling at Mina Justa.
Consistent with previously reported results, all intersections were determined using a 0.25% Cu cut-off and less than 2 metres of internal waste. Higher grade intersections were calculated using a 1% Cu cut-off and less than 2 metres of internal waste. All intercepts are down-hole length and intersection true widths have not been calculated.
Sampling procedures for the current drilling program are the same as previously reported and in summary: All RC chips are logged at the Marcona project site. Holes are sampled in their entirety in two metre runs and split at the drill site. A 1/8 split or approximately 5 kilograms of a two metre sample is submitted to the on-site SGS Lakefield Research ("SGS") preparation facility where samples are crushed to 95% passing 10 mesh and riffle split from which a 250 gram sub-sample is taken. The sub-sample is submitted to SGS, in Lima, for analysis. The coarse sample prep reject is bagged and stored on site and following analysis the analytical pulp sample is returned to Chariot for on-site storage.
All samples are analyzed for copper (Cu) using sequential leach resulting in four Cu analyses per sample (Cu total, Cu soluble in sulphuric acid, Cu soluble in sodium cyanide and a Cu residual). Gold is sampled using a 30 gram Fire Assay with an AA finish. Sulphide samples are submitted for 38 element ICP analysis with aqua-regia digest. Quality control procedures include insertion of certified project standards at the drill site (1 in 20), field duplicate samples (1 in 20), laboratory duplicates (1 in 20) and reagent blanks and reference material (1 in 20).
Data contained in this news release was validated and intersections calculated by Robert William Baxter, BSc. Hons. App. Geology, Director, Executive VP, Chariot Resources Limited, the designated Qualified Person as defined in National Instrument 43-101.
Mr. Alex Black, Chairman, said, "As expected the results achieved from feasibility drilling at Mina Justa are very encouraging. Management is confident that further positive drill results will be achieved during the coming months. Our team is working hard to ensure that the feasibility study, for the Mina Justa starter project, is completed as planned by the end of 2006."
Chariot Resources Limited (TSX:CHD - News) is developing its 70% owned Marcona Copper Project in Peru. With exceptional infrastructure, a significant resource and strong financial and commercial partners, Chariot's Marcona Copper Project is scheduled to be a mid-tier copper producer by 2009.
Additional details about Chariot can be viewed at the Company's website, www.chariotresources.com.
ON BEHALF OF THE BOARD OF DIRECTORS OF
CHARIOT RESOURCES LIMITED.
"Alex Black"
Chairman
PEAK OIL
The following link is from Financial Sense Newshour hosted by Jim Puplava. He has a roundtable discussion about Peak Oil with Richard Heinberg, author of Power Down and The Party's Over, and Richard Howard Kunstler, author of The Long Emergency. During the discussion, reference was made to Robert L. Hirsch, SAIC, Project Leader, US DOE, Feb 2005, who presented PEAKING OF WORLD OIL PRODUCTION: IMPACTS, MITIGATION & RISK........
While there was no mention of coal in this discussion, Kunstler has stated in The Long Emergency, "Now as oil recedes into depletion in the twenty-first century, coal will very likely make a comeback." (As we all know, coal is already here as it is responsible for 50% of electricity.)
(I usually use Real Player for my audio format.)
http://www.financialsense.com/Experts/roundtable/021806.html
BTU, PEAK OIL, AND COAL DELIVERIES OUT OF POWDER RIVER BASIN
Here are some facts and opinions that I posted on Raging Bull today.
http://ragingbull.lycos.com/mboard/boards.cgi?board=BTU&read=171
sumisu
Silver Wheaton Posts Strong Profit, Actively Seeking Acquisitions
By Craig Wong
14 Feb 2006 at 08:03 AM EST
VANCOUVER (CP) -- Unhedged, debt free and with $118 million in cash burning a hole in its pocket, Silver Wheaton [TSX:SLW; AMEX:SLW] is on the hunt for acquisitions, the company told analysts Tuesday.
''We're always looking at opportunities, but we certainly hope it will be sooner rather than later,'' said Ian Telfer, a Silver Wheaton director and chief executive of Goldcorp Inc. [TSX:G; NYSE:GG], the company's largest shareholder.
The quest for growth follows an agreement in which Silver Wheaton agreed to pay Goldcorp $150 million in a deal that will increase production by more than 100 million ounces over the companies' 25-year deal regarding the Luismin mines in San Dimas, Mexico.
''This is a spectacular deal for Silver Wheaton. It will be getting basically an additional four million ounces a year going forward for $150 million,'' Telfer said. ''It's very exciting for both sides.''
The company expects to sell 11.5 million ounces of silver in each of the next three years, increasing to 15 million after that.
Silver Wheaton chief executive Eduardo Luna said the company already has a plan in place and will be ready to hit its production targets in 2009.
''We're working on preparing the mine, developing the reserves, bringing the resources into the reserve category and working out all the mine infrastructure needed,'' Luna told analysts.
''By the beginning of next year we're going to be starting to invest in the development of the plant.''
Silver Wheaton holds the rights to purchase all of the silver produced by Goldcorp Luismin mines in Mexico, and by Lundin Mining's Zinkgruvan mine in Sweden.
Under the agreement signed Monday between Goldcorp and Silver Wheaton, Silver Wheaton will issue to Goldcorp 18 million shares representing 9.8% of the outstanding shares of Silver Wheaton, and a $20 million promissory note, increasing Goldcorp's ownership to 62%.
In exchange, Goldcorp agreed to waive any capital expenditure contributions previously required to be paid by Silver Wheaton.
Production of silver at the Luismin mines, which in 2005 was about eight million ounces, is expected to average approximately 9.5 million ounces for 2006, 2007 and 2008, increasing to 13 million ounces per year.
Silver Wheaton Corp. reported Monday its fourth-quarter profit rose to $7 million from $1.8 million in the same period a year ago.
Net earnings for the three months ended Dec. 31, 2005, amounted to four cents per share, compared with two cents per share for the four months ended Dec. 31, 2004.
''Goldcorp does not have any present intention to acquire ownership of, or control over, any additional securities of Silver Wheaton,'' the Vancouver-based gold company said in a release.
''The total consideration of $150 million is equal to the approximate value of Silver Wheaton's share of the future capital expenditures estimated over the remaining life of the existing agreement.''
In the fourth quarter, Silver Wheaton reported sales of 2.2 million ounces of silver, up from 1.5 million ounces in the comparable period.
Sales amounted to $17.5 million in the most recent quarter. Annual silver sales in 2005 amounted to $70.9 million.
Annual profit was $25.3 million, or 15 cents per share, from the sale of 9.7 million ounces of silver in 2005.
Silver Wheaton, which spun off from Wheaton River Minerals in 2004, made $1.8 million or two cents per share on the sale of 1.5 million ounces of silver in the comparable four-month period of 2004.
''The company is actively pursuing further growth opportunities, either by way of entering into long-term silver purchase contracts, or by acquiring silver exploration, development or production assets,'' the silver mining firm said in a release.
Silver Wheaton raised gross proceeds to $86.2 million on Dec. 22, 2005, from a public offering of 15.6 million subscription receipts at a price of C$6.40 each.
Each receipt was automatically converted into one common share, and one-half of one series B warrant [TSX:SLW.WT.B] of the company. The warrant entitles the holder to purchase one common share at a price of C$10 per share for a period of five years.
Silver Wheaton shares were up 44 cents at C$8.85 on the Toronto Stock Exchange, while Goldcorp shares were up 66 cents at C$28.08.
© The Canadian Press 2006
Ed,
Thanks for the clarification on the cash from the warrants and their effect on the stock price.
I guess the advantage of this approach is that Chariot will be receiving much needed cash from a vested party, Americo Resources Limited. I'd rather have this type of financing.
Thanks for your help. I have been following your thread; wow, there are so many potential investments our there.
sumisu
Big Ed,
After buying 10,000 shares on 02 08 06 and 15,000 shares on 02 09 06, I began having doubts about my purchases. Yesterday's share and warrant acquisition by Amerigo Resources Limited put my mind at ease.
Ed, will the warrants exercisable at 35 cents per Chariot share suppress or dilute the current shares outstanding?
I would guess that the warrants are a source of funds for Chariot?
I will sign this post as Little Ed until I acquire some more knowledge.
Little Ed
(sumisu)
Big Ed,
Thanks a lot for the chart on WHD!
When I looked at my Scottrade account today, there was an indication of a name change for West Hawk. I believe that it will be dropping the Development and adding Energy to more appropriately reflect its current activity, West Hawk Energy.(Not sure if the symbol will change.)
Just my opinion, but there might be exciting times ahead for West Hawk.
sumisu
conservspec,
Last week I was listening to Jim Puplava of Financial Sense and he interviewed a guest named George "Zapata" Blake. This was the second appearance of this intriguing Mr. Blake within a month and he mentioned Chariot Resources. I researched the company and figured I take a chance on another penny stock.
Funny, I swore off penny stocks and now I have Chariot Resources and West Hawk Development. I figured that with the possibility of Peak Copper and Peak Oil, it would be good to have two commodities (copper and anthracite coal) for the future.
I know Chariot Resources is quite away from actual actual production, but I'm willing to wait and see what develops.
Good luck to your establishing a position!
sumisu
Activity is increasing at West Hawk, both in drilling program and in volume of shares traded. This is the only penny stock that I can find with potential huge anthracite deposits.
sumisu
Press Release Source: West Hawk Development Corp.
West Hawk Updates Groundhog and Begins Drilling at Coal Creek
Friday February 10, 12:05 am ET
VANCOUVER, British Columbia--(BUSINESS WIRE)--Feb. 10, 2006--West Hawk Development Corp. (TSX VENTURE:WHD - News; "West Hawk" the "Company") is pleased to announce the winter 2006 drill program has commenced at the Coal Creek Project in the Telkwa Basin of Northern British Columbia. The project consists of 900 hectares of Coal Licenses located at the confluence of the Zymoetz River and Coal Creek, 40 kilometers due West of Smithers, B.C.
A ground supported 20-hole drilling program has commenced on the property with the current eight hole Phase One program completion expected by month's end. Pending a successful conclusion from Phase One a follow up Phase Two program will be initiated encompassing a 12-hole drill program and baseline environmental studies. The environmental work will be directed by Ecos Environmental Services of Smithers. The project has a potential haulage corridor northbound from the project to an unused rail loading facility at the Carnaby sawmill site via a largely-existing logging road network.
The most recent work on the property was done by Crows Nest Resources Ltd. from 1981 to 1985, consisting of trench sampling and 7 diamond drill holes. The program was designed to assess the coal quality and propose locations for two open pits. The data from these reports indicate up to six seams occur in the Lower Cretaceous Hazelton Group. The coal is high volatile bituminous A to B in rank with a free swelling index of 3. Volatile matter ranges from 32.2 to 37.2 per cent, fixed carbon from 53.3 to 55.3 per cent, ash from 3.54 to 11.45 per cent, sulphur from 0.38 to 0.53 per cent and BTU's from 11,941 to 13,258 (1913). (Paper 986-5)
At the Company's flagship Groundhog project, where a 980 million tonne speculative and 48 million tonne inferred anthracite coal resource has been identified, a CDN$1.5 million 20 hole drilling program is being engineered, permitted and financed through a strategic partnership with the neighboring coal license holders in the aim to validate historical data and advance the coal resources into the Measured and Indicated categories for the Lower and Upper Discovery Seams. Mobilization, base camp construction and drilling is schedule to commence in late March 2006.
The company has also granted incentive stock options to several of its consultants to purchase up to a total of 670,000 common shares in the capital stock of the company, exercisable for a period of two years, at a price of $0.50 cents per share.
About the Company - West Hawk is a mineral exploration and development company committed to building shareholder value through the acquisition of 100% interests in highly perspective mineral properties.
ON BEHALF OF THE BOARD OF DIRECTORS
Michael Townsend, President and Chairman
This news release contains certain "Forward-Looking Statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included herein are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed in the Company's documents filed from time to time with the British Columbia Securities Commission and the United States Securities & Exchange Commission.
The TSX Venture Exchange has not yet reviewed and does not take re sponsibility for the adequacy or accuracy of the content of this news release.
West Hawk Development Corp. (TSX VENTURE:WHD - News; FRANKFURT:H5N - News)
Contact:
West Hawk Development Corp.
Michael Townsend
President and Chairman
(604) 669-9330 or Toll Free: 1-866-669-9377
Fax: (604) 669-9335
info@westhawkdevelopment.com
www.westhawkdevelopment.com
--------------------------------------------------------------------------------
Source: West Hawk Development Corp.
oasdihf's link on UX board (http://www.investorshub.com/boards/read_msg.asp?message_id=9484292)
The World Cannot Survive Without Nuclear Energy
From the the Feb. 3, 2006 issue of Executive Intelligence Review.
Developments around the globe—from Europe to Asia and even the United States—indicate that leading policymakers are finally beginning to realize that the world will not survive without a revival of nuclear power. One of the most insane characteristics of the last 30 years of post-industrialism is about to be abandoned.
The LaRouche political movement has long insisted that a renaissance of nuclear fission, and then fusion, is an indispensable aspect of a world economic recovery. We welcome this development, and intend to do everything possible to move it along.
The most dramatic shift has been taking place in Western Europe, where formerly anti-nuclear trade unionists and politicians are now saying that they have to rethink their positions. British and German trade unionists are now talking about the need to expand the nuclear industry, in the face of both the dramatic increase in price of fossil fuels, and the instability of the supply.
Similarly, a turn toward nuclear has begun to be discerned in the United States, where licensing procedures are being simplified, and leading politicians are beginning to realize that "energy independence" means, among other things, going back to nuclear power.
But the proof of the pudding, so to speak, lies in Asia, where the preponderance of the world's population lives, energy-starved, in abject poverty. Economist LaRouche has insisted that particularly India and China will never overcome their destitution unless they move with an integrated 50-year development plan, which places great emphasis on nuclear power. They are not generating enough real income for their people, to bring the 70-80 percent of the population out of poverty.
The situation will get even worse, of course, if the Synarchist bankers behind Cheney et al. succeed in starting their new series of wars in the Perian Gulf region, which will even more massively disrupt oil supplies.
India, LaRouche has indicated, has tremendous capability for launching a massive program to build high-temperature gas-cooled reactors, using its vast supply of thorium. By building small plants, int he range of 120-200 megawatts, India is capable of producing the pressure vessels on a mass scale. Such a production program can provide the power to transform the rural areas of India by providing a lot of cheap power.
China is somewhat different, LaRouche noted, but still nuclear energy is vital. Hydro-power, such as that which will be produced by the Three Gorges Dam, cannot be expected to solve the nation's energy needs. Rather power from nuclear energy should be used to help China with its water management problems, since that country has an urgent need for moving water from one part of the country to another.
LaRouche's conception for the international nuclear revival emphasizes the importance of using thorium fuel (which cannot make bombs), and proliferating small reactors, which would minimize the loss of energy through transportation of power. Oil reserves should be used be petro-chemicals, and gas should be primarily used locally. In the future, the use of nuclear power will facilitate the shift to hydrogen-based chemical fuels.
The big picture is this: we are going to have to change the global economic reality over the next two generations. We are going to have to build new cities, deal with rural poverty, and create high-speed transportation and development corridors throughout the Eurasian region, the Americas, and Africa. We need to focus on the long-term benefits of investments in the physical economy, not the short-term opportunism of today's leading "economic experts." This 50-year approach is the truly revolutionary way to transform the world economy.
To carry out this perspective, the first step is to free the United States from Synarchist banker control, because the United States is the only nation capable of reorganizing the world monetary system. The second step is to initiate cooperation between the U.S., Europe, Russia, and China, especially on the full range of infrastructure development that is required. But all of such development depends upon ample, cheap, economical power—and that means nuclear energy.
http://www.larouchepub.com/other/editorials/2006/3305go_nuclear.html
bob3,
Is this the first time in history that the country has been in default with two consecutive Fed Chairmen?
I have to admit that the Fed and the politicians supercharge my precious metal holdings.
Thanks,
sumisu
LOT OF STOCKS HEADED SOUTH TODAY
Crude was a shade under $68 a few days ago. At the time of this writing, crude is $66.38. I hold CCJ and that was down $6.08 to $73. International Uranium was also down today.
Am I surprised that URIX is down? No.
Am I concerned? No. The uranium market is taking a breather, but if URIX is a long-term investment, then there is nothing to worry about, in my opinion.
sumisu
PEABODY ENERGY (BTU)
"ST. LOUIS, Jan. 26 – Peabody Energy (NYSE: BTU) today reported that 2005 net income rose 141 percent to $422.7 million, or $3.15 per share, compared with $175.4 million, or $1.38 per share in the prior year. EBITDA rose 56 percent for the year to $870.4 million.
“The Peabody team delivered record 2005 results for safety, volume, revenue, EBITDA, income and total shareholder return,” said Peabody President and Chief Executive Officer Gregory H. Boyce. “We believe that Peabody’s successes in 2005 and plans for 2006 mark the early stages of a long period of sustainable growth and ever-improving financial results. We are adding low-cost capacity to meet market demand and repricing contracts at much higher levels. All of our markets are experiencing very strong demand and prices – particularly our largest operating region, the Powder River Basin.”
Published pricing for benchmark Powder River Basin (PRB) coal has tripled in the past year, with recent over-the-counter prices exceeding $20 per ton. The Powder River Basin, where Peabody is the number-one producer, represents nearly two-thirds of Peabody’s U.S. production. The company is reaching multiple-year agreements that capture the value of these strong markets along with premiums for ultra-low sulfur coal driven by record prices for SO2 emission allowance credits. In addition, Peabody is currently securing new business at significantly higher levels in the Colorado and Illinois Basin markets, where Peabody is also the number-one producer.
FINANCIAL AND OPERATING HIGHLIGHTS
Peabody’s full-year 2005 revenues of $4.6 billion were $1 billion higher than in 2004. Fourth quarter revenues of $1.2 billion grew 21 percent compared with the prior year. 2005 sales volumes increased 5.6 percent to a record 240 million tons, driven by growing customer demand in all regions where Peabody operates. EBITDA totaled $870.4 million for the year compared with $559.2 million in 2004. Operating profit of $518.4 million more than doubled prior-year results.
2005 EBITDA from Mining Operations increased 41 percent to $1,036.3 million. Margins expanded significantly in 2005, overcoming geology constraints and transportation disruptions in the United States and Australia. Peabody’s solid results from operations generated 148 percent greater operating cash flow compared with the prior year.
Net income totaled $422.7 million for 2005, or $3.15 per share, and $162.2 million for the fourth quarter, or $1.21 per share. Net income more than doubled from the $175.4 million, or $1.38 per share, and $67.9 million, or $0.51 per share in the respective prior-year periods. Peabody provided a record 105 percent total return to shareholders in 2005.
Peabody operations set new production records in 2005 at eight mines representing more than 60 percent of the company’s production. Peabody’s Powder River Basin operations were also the three most productive mines in America, based on latest available industry data. Also during 2005, the company was honored with five environmental and community excellence awards given by the Department of the Interior, including the Gold, Silver and Bronze “Good Neighbor” Awards. Peabody operations in Colorado, Midwest and Appalachia earned an additional six reclamation awards in 2005.
Peabody’s safety ratings improved another 33 percent in 2005, marking a 48 percent improvement over the last three years. Four operations achieved the company’s goal of zero accidents. Peabody’s record 2005 safety performance is 45 percent better than the U.S. average, based on available industry data, and received recognition at operations in both the western and eastern United States. The North Antelope Rochelle Mine received the “Safe Sam” award for the second consecutive year, recognized as the safest mine in Wyoming. The Harris Mine earned the Mountaineer Guardian Award for outstanding safety achievement from the West Virginia Office of Miners’ Health, Safety and Training and the West Virginia Coal Association.
MARKET OVERVIEW
“U.S. and global market fundamentals are exceptional,” said Boyce. “Amid expensive oil and natural gas, we are experiencing record coal demand to satisfy electricity plants that are operating at higher rates. New generating plants are being developed at a record pace, global steel demand continues to grow, and interest in projects to turn coal into natural gas, transportation fuels and hydrogen is rapidly increasing.”
The global supply-demand balance for coal remains extremely tight, driven by the growing U.S. and China economies and increasing demand for electricity generation and steel production in the Pacific Rim. Global and U.S. coal-fueled generation is expected to reach record levels in 2006. U.S. generator stockpiles of approximately 100 million to 105 million tons are at historic low levels, and replenishing these inventories will take considerable time due to strong underlying demand growth and limited rail improvements.
Demand for metallurgical coal remains very strong around the world. In the fourth quarter, for instance, Peabody reached agreements for significant 2006 metallurgical coal deliveries in the United States at prices above the strong prior-year levels. Metallurgical coal supply agreements from Australia for the fiscal year beginning April 1 are still being negotiated.
The current record high prices of SO2 allowances are resulting in premiums of $3 to $4 per ton above the benchmark 8,800 Btu per pound Powder River Basin coal for ultra-low sulfur products from Peabody’s North Antelope Rochelle Mine and the planned School Creek Mine. Sulfur emissions allowances, which have increased nearly 11-fold since 2003, are expected to remain high due to delayed scrubber installations and tightening emissions regulations.
Competing fuels remain very limited. Nuclear units continue to operate near capacity and the cost of oil and natural gas remains high due to limited supplies and very strong global demand. Recent forecasts by the U.S. Energy Information Administration (EIA) further reinforce the favorable long-term markets for coal. EIA’s Annual Energy Outlook increased the long-term price estimate of crude oil by two-thirds to $54 per barrel by 2025. Long-range estimates of liquid natural gas (LNG) supplies to the United States were reduced approximately one-third due to increased global demand that makes LNG less available and more expensive in U.S. markets. The estimate of coal’s share of U.S. electricity generation has been raised to 57 percent by 2030. Total U.S. coal demand is now estimated to grow from 1.1 billion tons per year in 2005 to nearly 1.8 billion tons per year by 2030.
Interest in new coal-fueled generation remains strong. Globally, approximately 435 gigawatts of new coal-based electricity generation are under various stages of planning and development. In the United States, the Department of Energy has identified 129 power plants that have been announced or are under development in 40 states, representing 77 gigawatts of electricity and more than $100 billion of investment.
During the fourth quarter, Peabody reached agreements with customers for 2006, 2007 and 2008 delivery of premium PRB coal for prices that are more than 130 percent higher than Peabody’s average 2005 realized prices. As previously mentioned, prices for benchmark premium PRB coal have more than tripled over the past year. Much of the rise occurred in the second half of 2005, therefore benefiting contracted volumes for 2007 and beyond.
Peabody has substantial volumes of PRB coal that will be priced in the current favorable market conditions. Peabody’s total unpriced volumes at year-end include 15 to 25 million tons for 2006, 90 to 100 million tons for 2007, and 155 to 165 million tons for 2008.
New markets for coal are rapidly emerging via Btu Conversion initiatives. Coal to natural gas and coal to liquids greatly expand the product line for coal and Peabody long-term. For instance, the U.S. EIA for the first time estimates coal-to-liquids applications will add another 190 million tons per year of additional demand over the next 25 years. Peabody is uniquely positioned to participate in these emerging markets, with more than 9 billion tons of proven and probable coal reserves.
GROWTH INITIATIVES
Capital expenditures for 2005 totaled $503 million (excluding acquisitions) and included a number of productivity and growth investments, including $118 million related to the acquisition of high-Btu, ultra-low sulfur Powder River Basin reserves.
“In anticipation of strong Powder River Basin demand, we made the largest investment in reserves and capacity additions in the Powder River Basin in recent years,” said Executive Vice President and Chief Financial Officer Richard A. Navarre. “This positions Peabody to capture both surging demand and pricing in the PRB over the next several years.”
Peabody is targeting 2006 capital expenditures of $450 million to $525 million, excluding previously committed PRB lease payments, as the company implements a number of growth initiatives by focusing investments on high-growth, high-return projects. Approximately $250 million is allocated toward maintenance and replacement capital, including construction of the Black Stallion metallurgical coal mine in West Virginia. Replacement and maintenance capital represents about $1 per ton of production capacity.
The remainder of the capital is associated with growth projects and corporate initiatives. Peabody will invest more than $90 million to increase production by 15 million to 20 million tons at its PRB mines in 2006 to accommodate customer demand. Another $65 million is being invested for mine expansion projects in the Midwest to serve growing markets with an additional 4 million tons of production coming online by 2007.
“Peabody’s unique combination of high-quality reserves in growth markets, expected strong cash flows and sales backlog allows us to target organic capacity growth of more than 75 million tons by 2010,” said Navarre. “We expect these capital investments to average $15 to $20 per ton of new capacity, which is substantially more efficient than the industry average.”
Among other capital projects:
• Development, permitting and sales contracting initiatives are progressing for the 30 million to 40 million ton-per-year School Creek Mine, an ultra-low sulfur PRB mine that will be the largest new U.S. mine in a decade when it comes online as early as the last quarter of 2008.
• The new El Segundo Mine in the Southwestern United States is being developed to supply the recently signed 19-year, 65-million-ton coal supply agreement with Arizona Public Service (APS) that will generate revenues well in excess of $1 billion over the life of the agreement. El Segundo will begin operations in 2008 and will have the capacity to produce 6 million tons annually to serve APS and other customers. Approximately $90 million will be invested to develop the mine, including a small amount in 2006.
• The Twentymile Mine in Colorado is installing a new longwall system in the first half of 2006, which will allow the mine to increase capacity to 12 million tons per year by 2008. The installation will increase productivity and production capacity to meet growing demand for high-quality, low sulfur Western Bituminous coal. Twentymile Mine is one of the safest, largest and most productive longwall operations in the United States.
• During the first quarter, the high-quality metallurgical coal mine North Goonyella in Queensland will install a new longwall system purchased in 2005 to increase reliability and productivity.
• The Harris Mine in Appalachia will begin production from the James Creek reserves near mid-year 2006. Harris was originally scheduled to close in 2005, and the transition will extend Peabody’s access to high-margin metallurgical and thermal coals for several years. Approximately $15 million is being invested in 2006.
• A third dragline is being installed at the 90 million ton-per-year North Antelope Rochelle Mine to lower costs, further expand capacity and increase productivity. The dragline, which will improve productivity and reduce dependence on higher cost truck-and-shovel systems, is expected to begin operations in early 2007. Total cost of the dragline is approximately $60 million.
• Peabody is proceeding with site selection with ArcLight Capital to advance the development of a commercial-scale coal gasification project in Illinois, which would use ConocoPhillips technology to transform coal into pipeline-quality synthetic natural gas.
OUTLOOK
Peabody is targeting full-year 2006 EBITDA of $1 billion to $1.15 billion and earnings of $3.75 to $4.85 per share. Performance will be largely impacted by metallurgical coal production and pricing, as well as PRB rail performance. While customer indications suggest that 2006 Powder River Basin demand could increase by 15 percent or more, the railroads expect that they will only be able to accommodate half of this pent-up demand. Peabody is targeting 2006 production of 230 to 240 million tons and total sales of 255 to 265 million tons.
For the first quarter, Peabody is targeting EBITDA of $200 to $250 million and earnings per share of $0.60 to $0.90. Results will reflect lower production and higher costs related to significant longwall system installations at several of the company’s longwall operations, as well as an increase in fuel, explosives and health care costs.
“We are targeting significant earnings growth in 2006, and an even brighter outlook beyond,” said Boyce. “The full impact of improved prices in our key coal markets will be realized as long-term contracts are repriced. We also look forward to benefiting from planned capacity additions, new higher-priced contracts, and the expanded markets created by Btu Conversion projects.”
Peabody Energy (NYSE: BTU) is the world’s largest private-sector coal company. Its coal products fuel more than 10 percent of all U.S. electricity and 3 percent of worldwide electricity."