Cline Mining Corporation T.CMK

Conversation with CFO

[courtney10]

I just had a 30 minute discussion with the CFO (Ernest Cleave)

Here is the summary.

1-  At the time of the AGM, mgmt was expecting approval of the mine plan for the Blue Seam,  the approval has been delayed . So, company was running out of money, needed to do an equity issue. They were not expecting the delay with the approval.  The company is not allowed to release news on pending MSHA approvals.

2 Allen and Apache seams have been approved,  Blue Seam approval expected in September at the earliest. They have hired an engineer to assist with the approval, he is basically at the MSHA office on a daily basis.

3- Without Blue Seam approval - company will do about half of the 350k tonnes this year and in 2012 - will do about 1.5 million tonnes  ( this is from the Apache and Allen seams)   Company will be able to sustain cash flow from just the 2 seams (this is worst case scenario for them)

3- With blue seam approval,   350k tonnes by year end is achievable, and 2.7 million tonnes in 2012 is achievable

4-  He will be very careful with spending the $81 million.   They need to buy the continuous miners right away and other expenditures are needed immediately, but will delay spending money on the rail spur until Blue seam approval is obtained.

5-  No contracts to be announced anytime soon, need to stockpile more coal and thus guaranty product delivery before a customer will sign with them.  Coal pricing today for them would be between $230-$270 tonne.

They are frustrated with the approval process from MSHA,  but seems confident that the mine plan will be approved.

[straightbull]

Good feedback. Thank you.

[ckstar83]

hey courtney thanks for the post,does that mean that maxwell, apache and allen seams are all aproved and the blue seam is the only remaining for approval?????any info would be great, thanks,

[miner8740]

mining machines not on order, it will take at least 6 months for JOy to produced a mining machine suited for the mining conditions, may  be high risk, sound like 350 k will not be meet this year

[jkallas]

I can't believe that such a material change had to be coaxed out of them by ...Courtney UN fricking believable. Courtney since your news, the stock has fallen about 8 cents... That's great digging. I am will look at this POS at $2

[Caerus88]

"3- Without Blue Seam approval - company will do about half of the 350k tonnes this year and in 2012 - will do about 1.5 million tonnes  ( this is from the Apache and Allen seams)   Company will be able to sustain cash flow from just the 2 seams (this is worst case scenario for them)"------------------------Am I missing something here? My understanding was that management

[brundall]

This post has been removed in accordance with Community Policy

[pastafagoli]

On point #1 - re company cannot release news on pending MHSA approvals - they Press released that they expected approval before christmas last yr - this drove the stock On Point # 5 - why the low prices - recent contracts were $330 and cline coal should get a 10% discount !!  why are they expecting 230 - 270 !! 

[mski]

pastafagoli, the $330/tonne you refer to related to the highest quality coking coal.  The stuff CMK has is a slightly lower value coal (ie. PCI coal) which typically settles at a discount of between 15% to 25% of the highest quality coal.  Hope that helps.  Best regards, mski

[Wolfhunter2]

Well there ya go Jkallas all your BS about cutting me up and now we find out they can not even be truthfull about things .