MNM closing green on a market wide red day that would have been perfect for the cappers to try and belt the SP down to 11c suggests that they may have finally filled their order and closed up shop.
if that is correct then it is probably because they can smell the twin threat of the moisture content and EL5294 ann's on the MNM horizon.
don't be surprised if an update on the progress of MNM's discussions with the Calleja's about the development of the Maddingley BM brown coal mine is also made before the end of this month so that all the ducks get lined up before the CCV conference on 30/31 March.
For the benefit of newcomers to MNM the story goes like this:
The Victorian brown coal plan started with the surprise, out of left field, arrival of Ian Kraemer as the new CEO of MNM a few years ago. At that stage MNM had nothing to do with brown coal, and was focused on the black coal potential of Mt Mulligan in Qld, and the phosphate potential of its large NT tenements near to MAK's Wonarah project. These 2 projects alone saw the MNM SP touch 50c in 2008. They are both still being progressed, and are highly prospective for MNM.
Then we learned that Ian had been a senior coal infrastructure engineer with Thiess, and had been for several years seconded from Thiess to head up the exergen project. We now know that exergen is partly owned by Thiess and Sedgman, who, in combination, are Australia's biggest coal project infrastructure players through a JV they have for that business. Sedgman/Thiess JV have designed and constructed many of Australia's biggest coal plants, and do the same overseas as well.
We then found out that TATA and Itochu, who are global scale players in the coal buying game (google them), are on the inside of the plan as part owners of exergen as well. They deliver all the offtake capacity and financing muscle that the project will ever need. Between TATA and Itochu they had revenues of more than US$100 billion in 09/10, and employ over 400 000 people in 90 countries. (TATA employs 49 people on the issue of reduced carbon emissions alone.)
TATA Power, a division of TATA Group, burns coal to provide electricity to the booming Indian economy. They project (on their website) a 700% increase in coal demand by 2017. And strict new carbon emission rules will have started in India by then which clean brown coal from Victoria would comply with.
None of this meant much to MNM holders until it was ann'd late last year that MNM had entered a company making, binding 50/50 JV with exergen to develop a brown coal mine and processing operation in Victoria. The scale of potential revenues from this JV for MNM are Fortescue-esque.
The MNM board has played this all to perfection, and MNM holders are now very close to knowing whether their years of planning and implementation will bear fruit in the form of a landmark brown coal conversion and export facility for Victoria. If it becomes likely that the JV will commit to build the plant at BM adjacent to the Maddingley Mine then the MNM SP should instantly re-rate to 50c+, and then climb steadily for years to come.
MNM Price at posting:
13.8¢ Sentiment: Buy Disclosure: Held
