northern energy (nec), page-41

re: nec - the coking coal game Cobby, longer term looks good. The main game plan here is at Ashford, where we are expecting an intitial JORC resource of 7-10mt of cocking coal in the previously mined ("hatched") area. If you go back and have a look at the posts by jj (look under PLL about 2 weeks ago)it is a very good analysis for the longer term potential of the company. I am just using US$5/t (last contracted price for HARD coking coal was US$125/t) of JORC resource in the ground for a basic valuation. If you take 75% of the project, approx 60m shares on issue and 7 - 10mt of INITIAL resource you get a value of 55c to 78c of INITIAL valuation and takes into account no value for exploration or Taroom (Thermal Coal project). This would obviously expand once they explore outside the small area that was previoulsy mined and get into some of their other projects. So you can see there is significant upside

This is not an exact science and many would agree and some disagree with this method of valuation but it is easy and straightforward to understand.

You can work out the numbers for yourself that in a booming coal market that there is significant upside over the longer term as the stroy develops