Compliance Energy Corp CPYCF

RE: RE: RE: RE: RE: 88% Met Coal 12% Thermal...

[chrisale]

Oy. 2guys. You need to stop accusing of false things. I did not "imply" anything I quoted DIRECTLY FROM THE FEASIBILITY REPORT. As did you. You seem to not understand what "thermal middlings" product is. It is not the same as a "High quality Thermal". The feasibility study states it clearly:
https://www.newswire.ca/en/story/748713/compliance-energy-corporation-positive-feasibility-results-received-for-the-raven-coal-project

Quote:
Middling(2)
Product

(2)	Although metallurgically a SSCC product, the ash content is in excess of 10% and thus this portion of production is classified as a Middling product.

The "High Quality Thermal Coal" has 15% or more ash in it. IT IS NOT A MIDDLING PRODUCT.
To further explain it here is the information straight from the PAH Technical Report (June 2011 on SEDAR)

22.5.1 Product Target Specifications

The basic target specification for the metallurgical coal product is:

? 10 percent ash (dry basis)
? ~ 1.2 percent Sulfur (dry basis)
? ~7.0 percent Moisture as-received

The basic target specification for the thermal coal product is:

? 15 percent ash (dry basis)
? ~ 7,000 kcal/kg (dry basis)
? ~ 1.2 percent Sulfur (dry basis)
? ~ 7.0 percent Moisture as-received

So perhaps you will understand it better this way:

The two modes of the Processing Plant as proposed by Raven "base case" and "alternative case"

Mode A metallurgical:
Percentage of product from the raw material: 43%
Production:
88% Semi Soft Coking Coal (<10% Ash)
12% SSCC Middlings Coal (>10% Ash therefor only suitable for Thermal)

Mode B thermal:
Percentage of product from the raw material: ??% (I believe it is around 50% but I haven't been able to confirm this)
Production:
100% High Quality Thermal Coal (15% Ash)

TABLE 22-23
Compliance Energy Corporation
Raven Coal Project
Raven Project Financial Analysis Summary

Parameter	Base Case	Alternative Ca se	Note
Cost of Production (C$/Product tonne)
Production and Processing Costs Range	48.52-69.92	39.93-54.75	Steady state production (2015-2026)
Production and Processing Costs Average	58.17	46.33
Onsite Costs Average	61.02	49.18
Offsite Costs Average	15.48	15.17
Total Cost of Sales Average	76.50	64.35
Revenue (C$/Product tonne)
Semisoft Price Range	150.00-190.00
Semisoft Price Average	179.38
Thermal Price Range	113.00-143.00	113.00-143.00
Thermal Price Average	136.45	136.14
Overall Price Average	174.22	136.14
Earnings (C$/Product tonne)
EBITA Average	97.73	71.79
Capital (C$ million)
Initial Capital Investment	219.7	216.2	To steady state production (2012-2015)
Total Capital Outlay	291.9	288.4	Includes sustaining capital
Financial (C$ million)
NPV05	540.0	476.8	Base year 2012
NPV08	378.0	328.1	Base year 2012
NPV10	297.5	254.6	Base year 2012
Internal Rate of Return	28.70%	26.50%
Undiscounted Cash Flow (EBITDA) Payback	Year 5	Year 5

And as you can see from this table from the Technical Report, the actual financial difference between Mode A (base) or Mode B (alternative) is not huge. It would not take a huge swing in prices, or drop in general demand to compel the company to switch given the reduce operating costs in Mode B and (I believe, but not confirmed) less waste.

Hopefully THAT puts it to rest. Raven is prepared to sell 100% thermal coal from its mine if market conditions warrant. So the PR about 'it's all for steel' is just that, PR, they have left their options open and neither they nor you can know how it will all pan out.