Apologies for my seemingly monthly CPL ramblings but I though I would outline what I view as important upcoming share price catalysts which I believe will lead to significant share price appreciation.
Friday's impending announcement re Highland Park officially becoming a strategic shareholder and Colin Steyn's formal appointment to the CPL board will mark the beginning of 3-4 months of significant CPL price catalysts which should (all things considered) see the CPL share price closer to $2.00 than $1.00 in my view. Whilst this may seem farfetched to some if we look at the share price increase catalysts it is my view that real possibility exists.
***Announcement of Highland Park on board and Colin Steyn as a Director. Becoming official and their input of $22.5 mil will be seen as a positive particularly in North American markets.
***JORC update on the Coalspur Project leases which includes lands that were subject of feasibility studies by Denison Mines in the early 80s. Given CPL has been working on JORC numbers for more than 6 months we could possibly see the JORC amount incorporate a significant portion of previous drilling results.
***Acquisitions of further coal leases. During the presentation by Gene Wusaty to the Hinton Chamber of Commerce he mentioned on more than one occasion CPL's aim of increasing land holdings containing existing resources. We have speculated that this is likely to be the Mancal leases. Whilst Mancal control the lease dividing Hinton East and West they also control substantial leases that extend in a south easterly position from Hinton East. Mancals website states that they control over 2 billion tonnes of undeveloped coal resources in Alberta and Saskatchewan. I dont know the allocations but looking at their leases next to CPL's one would assume at least 1 billion tonnes is contained. Having said this, Mancal would not just give them away. Even at 10c per tonne CPL is looking at $100 million. Therefore, how such an acquisition would be funded is the unknown. It will be interesting to see what eventuates but with Hinton, Coalspur and Mancal leases CPL could control over 2 billion tonnes of coal in the coming months. A conservative (given available infrastructure) 50c ev/per tonne in situ would give a market cap of $1 billion. In addition, the economies of scale created by increased production tonnage could see FOB costs somewhere near US $40 a tonne.
***Release of coal quality results which will enable CPL to market coal to potential off-take partners and bring them on board as investors. As Gene said in his presentation (in about 3 months he and Denis are heading to Japan, Korea and China to visit their friends to market CPL's coal). As he also said this is something he has done on many previous occasions and by all accounts been very successful at. Given this statement was made late March this should occur within the next month or so. It would be a real positive going into the TSX listing with knowledge of potential off-take partner/s / investors.
***Updated scoping study for larger mine plan. According to Gene's presentation slides this could conceivably be 8 million tonnes of saleable coal per annum. At reduced FOB costs project economics become even more attractive. I am only thinking out loud but I wouldnt be surprised if CPL had already started scoping work on a mine plan looking at somewhere near 8 million tonnes.
***Pre TSX listing marketing. From what has been mentioned on the CPL thread previously, there will be no new scrip issued as part of the TSX listing. As such, all buying of CPL will need to occur on ASX in the lead up. Given the already relatively tight share register with Directors, Associates and other top 40 shareholders controlling approx 64% of available shares only 36% of shares are available as free float. Basic supply and demand forces could see the share price rise significantly with substantial buying pressures from North America/Canada prior to listing. The tightness of CPL's share register is an important factor in my view that should not be under estimated.
So whilst the previous 3 months have been relatively slow with respect to news flow I believe the next 3-4 months will be unprecedented in CPL's history and some of the most exciting for shareholders with respect to activity and news flow and as such we should start to see true share price value realised for investors.
DYOR
Regards
Danash
CPL Price at posting:
69.0¢ Sentiment: Buy Disclosure: Held
(20min delay)