Xstrata Website
https://www.xstratacoal.com/EN/Operations/Pages/DonkinExplorationProject.aspx
As per the website Donkin is now a 5 million tonne per year operation. 1.25 million tonnes for Erdene. $35 cost is higher than PEA on a ship. I have an email from Akerley when hard coking coal was $200 asking him what our met coal would be worth. He says 175. HCC is now over $275/ tonne. Quick math 1.25 million tonnes @ $100 profit a year (ie double costs and reduce market price by 30%) is 125 million a year. 10 times earnings gives Erdene a market cap of 1.25 billion or $13/ share. There is 100 years of coal at 5mmtpa in Donkin currently.
If we take the costs from the PEA of 28 dollars on ship and todays soft coking coal price of $230 a tonne we would get a 10 times earnings share price of $26 for Erdene.
This gives no value for Zuun Mod or exploration, or Granite hill or anything else. Don't get scared. 1.45 is very cheap. The folks in India, Indonesia, Brazil, China are not going back to their huts and rice paddies any sooner than I am going back to the falling down farm house in the prairies. Urbanization is a 1 way street. No better way to play than Erdene.
Fast Facts
Location
Canada, North America
Products
Coal
Employees
15
Annual production capacity
Donkin is being considered as a 5mtpa underground Longwall operation. Markets are anticipated to be both domestic and export. The short shipping distances to the East Coast of the United States place Donkin in an ideal position to enter this expansive market.