gazman, page-17

Gents,

Coal is a hot sector. All forecasts and demand profiles are bullish. Thermal coals look to be less affected by global issues because its linked to people needing energy. Coking while collecting a premium in the boom times can be severely affected during slumps.

Most of the juniors are really going to struggle due to the quality of their tenements. There has been a lot of land grabs over the last 10 years leaving not much decent ground at all. That being said being penny stocks they don't need to find a world class mine to make some coin. They do however have to find a deposit that is profitable. Coal is a bulk commodity and works best on the large scale.

On the juniors with some potential:

Guildford have a chance behind Maryborough...but the rest of their tenements are not flash.

Endocoal has ground at Rolleston that Xstrata would like to have so they may get a free ride. It will be interesting in the extreme to see if they can go underground at Rolleston as I really doubt the economics and feasibility of going underground there. This could rerate some of the other tenements held by juniors.

East Energy Resources has a very large deposit but is marginal on some quality specs but with some good marketing and an efficient bulk mining proposal could make a go of it in years to come.

Rey resources has a deposit in WA and while it is reasonably untested historically they have A-Class geological and coal quality people backing it. A few hairs on it none the less.

Any of the players in the Galillee are capable of scraping a large deposit together but is an expensive province to develop and whilst huge tonnages are report the seams can be very variable coal quality wise. Longer term play.

There is probably quite a few flying under the radar still with chances equal or better to the ones I have listed.

As I said many of the late comers are going to struggle with their ground. But some of the developments proposed by the mid tier coalies is only marginally better. There is no two doubts that as the prices change so does the type of deposit that can be mined. But there are quite a few that are atleast 10-20 years ahead of their time.

Gaz