RE: Bond will mature in Feb 2014 EOIM, that was a typo on my part saying the debt matured in 2013. In my earlier posts I mentioned 2014 as the maturity date. The point is that I don't see New Elk starting up in 2012 given the current coal market conditions. So even if they start up production in early 2013 that only gives the company a little over a year to make enough profit to pay back the $50 million. The problem is the level of coal sales required to make $50 million of profit also implies a much higher level of cap-ex. I don't see CMK making enough cash flow in a little over a year to fund cap-ex and to pay back debt. Don't forget these guys will be a high cost producer and I am willing to bet that their marginal cost structure will be even higher if they are not producing an optimal amount of coal as their fixed costs would be spread over a lower number of tons. The higher the costs the more difficult it is to generate positive cash flow.You can call me a basher but I have always provided support for my opinions. And so far I have been right as the fundamentals of this company have deteroriated and CMK stock trades like a penny stock on the old Vancouver Exchange.
As far as the value of the two other properties Cline owns. The first being a speculative iron ore resource in Madasgasgar. Here's a quote from the Cline website about the property.
"Until this drilling has been completed and results obtained, estimates of mass in these three prospects have no economic significance. Readers are cautioned that the “estimated total mass” identified in our July 30, 2007 news release is conceptual in nature, there has been insufficient exploration to define a mineral resource and it is uncertain if further exploration will result in the target being delineated as a mineral resource."
The second property is an abondoned gold mine in Northern Ontario that once produced some gold in the 1930's. I'm sorry but I don't see any entity paying up for either of these two properties especially given that CMK needs cash now.