nmr valuation, page-7

Thanks Pizzabox and Nyc3053,

From the broker research (DJ Carmichael), the likely development scenarios for NMR would be to commercialise their asset through power generation, either via an investment partner with capacity for coal-fired power stations or through surface gasification technology, which has been used in South Africa for decades (Sasol).

http://www.sasol.com/sasol_internet/frontend/navigation.jsp?navid=1&rootid=1

Also using "existing technology and access to off-the-shelf components makes this option more attractive and could provide a route to commercialisation of NMR s coal assets in a shorter time frame than exporting large volumes of coal. Also power infrastructure is already nearby and there is a ready market for power within Botswana but more so, in South and southern Africa."

Also NMR could be a takeover target from Indian company, the reason being NMR has a good coal quality compared to its peers in the region, and also the potential size of its resources. Recall the Indian power producer JSW’s C$422m bid in late November, for ELC coal developer (at Mmamabula, Botswana).

(January 2011 Blackswan Equities Research Note/ AFR):
"With JSW unlikely to be interested in small-scale extraction, the deal signals confidence in the regions coal assets and infrastructure developments."

Cheers,