RE: RE: RE: RE: RE: Bignikhey dimwit denny,
do you know jack about mining? ever worked at a mine? I bet you dont know the first thing. I have worked in mining for 15+ yrs, and have worked at these exact mines you are talking and think you konw about.
First, EVCC will produce about 15-16 Mt this year and likely next, and no $85 only applies to 20-25M tonnes prodcued, now the fixed costs are spread over less tonnes, its accounting 101, something else Im sure you know jack about. Its a mystery as to where it lands but my guess is about 105-110 prodcution costs. ALso have you considered sensitivity to the cdn us exchange? or do your high school math levels allow you to do so? you will find that a 10 cent increase in cdn, knocks the net revenues down by 30 to 50%, and guess where the dollars headed? Net revenues from EVCC will be quashed this year, even if the dollar holds 90 cents.
Second, have you seen the major axings in the iron ore market, ie the market most closely correlated to this met coal one? 30-40% axings off the raw price, not really negotiated, but dictated by the chinese and japanese. Demand is not there,
Third, east coast australia has structurally lower costs than EVCC, and always, will, it has to do with their stripping , but more importantly, their proximity to port. they will always have about 20-40 $ less costs to get their product to port, and there in will always have a competitive advantage, and sell more product, and have greater market share, and power than teck will.
Also, if you you knew anything about the steel markets in asia, you will know that the hundreds of small plants inland, will be making way for 2 to 3 mega steel plants on the coast, and all the little guys will be shut, do you know the effect this will have on price, its like a cartel in an oversupply case, they will have all the pricing power, because the market becomes and oligopoly.
and lastly, no 800 Million pre tax does not justify a 9B purchase price, 800 Million is worth a mere 5 to 6 BLN, but if you werent so stunned you would realize the revenue attributable to this deal is only half, in fact its 48%, so whats 48% of 800 Mln, that more like 400, 400 M cash flow ABSOLUTELY DOES NOT JUSTIFY 9B in CAPEX, expecially once disounted, 400M per year is worth about 3 Bln to any real investor or controller of funds.
now stick your tail down and get on the sidelines, dimwit denny, you are clearly a novice just like SEANJ !
BigNick.