My thoughts Pretty much exactly what I wrote yesterday funnily enough. Erdene is not in control, it's a big company Xstrata and they take their time. If it was really bad they wouldn't have spent 30 million researching it. Everything is a gamble but my take is this:
Xstrata's website says 5 million tonnes a year. 1.25 million tonnes/ year to Erdene. Value of this coal is over 200 dollars (todays market price is likely around $300/tonne). Cost to get it out according to the info we already know is $28/ ship less washing. Lets wash it for $10/tonne, high but conservative. Long term thats $160/ profit per tonne. That gives us 200 million a year in net revenue. Our current market cap is $130 million which also includes Zuun Mod which is big and getting bigger.
To add to the joy Devco spend a 100 million in 1990 dollars to build the access tunnel for the harbour seam. We can get up and running for the cost of a few trucks and a continuous miner, and ramp up production to reduce start up costs- and dilution.
So not much risk from here. It is however big gains for some and they are sweating and selling a little bit. WTN went from 39 cents to 12 dollars and although are coal isn't quite as good it doesn't need to ride on a train for 1200 kilometers after a 100 kilometer truck ride to get to a boat. Our coal just gets on a boat pretty much.
Thats my take. For gamblers Erdene also looks for coal in Xstrata and Xstrata pays for ALL expenses, Erdene gets to keep 25% of what they find. They are the old masters of exploration in Mongolia and have 100,000's of hectares of prime exploration land.
Plus they have some great properties in the states including 100 million tonnes of granite and some of the worlds best Kaolin deposits.
Good luck to all and I hope my decision to stay long isn't the wrong one. My head says yes, my heart says- you've made lots of money get out now. Kind Like I did selling WTN for 3.20 after buying at .51.
Cheers!