announcement out, page-28

nzak,

I didnt actually compare australian coal and african coal, I compared the strip ratio to calculate a cost per tonne coal ore mined.

I even scaled it down by a factor of 4 due to cheaper labour and equipment.

Secondly, I agree the coal quality and deposite size are similar between AFR and NMR, however few key differences emerge immediately:

First. They have rail infrastructure for power generation in place

Secondly. They have a bed depth of between 30-60 metres (from top-earth to the seam) with a seam thickness of 10-35 metre, averaging 14m, giving a strip ratio of 1:2 and max of 1:7, which cuts cost dramatically. (compare to 3m thick seam at 60-150m depth, it is a huge cost difference) and from the AFR announcement, average strip ratio of 1:2.84 is maximum. AFR costs are roughly 15$/tonne of washed coal (12.69 for raw tonne, 3.5 for washing).

Thirdly, a full washability study has been done and proved two things, firstly a 28% yield of export thermal coal (valued at 80$/tonne roughly) and an additional 50% yield (totalling 78% yield) which can be used for local market/power generation (30-40$ per tonne).

"Coal Processing and Handling
The Sese coal deposit can produce two products:
? Domestic coal for power stations, hydrocarbon conversion and regional consumption, and
? Export coal for regional and international consumption.
The export coal can be produced by processing ROM (run-of-mine) coal through either single stage or two
stage washing plant." from AFR announcement.

Finally, AFR is on a proven belt of coal resources with customers lined up and low initial capital.

The main point is not that NMR isnt a good company with a good resource, but rather that the current market valuation of NMR is pretty on-track.

There is a lot of risk pre-washability and pre-feasability.

This is what announcements i'd look for, but hey, what do i know, im just a simple process engineer working.