"Independent Geologist’s Report in relation to EPC Applications 2336, 2337, 2338 establishes exploration target of between 6.6 billion and 18.1 billion tonnes of thermal coal product in the Winton Formation"
since NSL announced the exploration target in July, the only stock I keep buying is NSL.
I remember the BND story, soraing from 2c to 25c(before consolidation)
CEO from 1c to 18c TVN from 1c to 9c ZYL from 1C to 30c MNM from 3c to 29c--just based on 2 billion tonnes of brown coal which MNM only owns 50%. EER from 8c to 70c ICX from 18c to 37c--in last 3 month. NRL from 3c to 19c
1, If we only talking about resource potential, actually ATM, NSL has much higher potential than all of above companies.
"Target 6.6-18.7 billion tonnes of thermal coal in west-south Queensland."
2, I tend to doubt this target all the time but NSL announced in its latest QR: "the sufficient coal thicknesses interpreted from historical drilling warrant further investigation."
Historical drilling results maybe not available for us, but clearly, the resource estimation has strong support by the previous drilling.
3, Majority coal seam thickness is 4-8.5m. I think this is why the Winton Formation has much higher potential than other Queensland coal projects--Normally, the coal seam thickness is 2-3m in QLD for many coal projects.
4, Next door EER has confirmed 1.2 billion tonnes thermal coal resource, ICX just confirmed significant coal seam thickness in its 2197 licence and these are all less than 5 km to NSL's tenements.
Considering the coal resource in place, NSL has strong potential to be QLD's LARGEST COAL MINER.
NSL's near term iron ore production--30 days to go!
1, After years delay, finally NSL has commenced the beneficiation plant operation, 30 day to go for our first produt batch.
"In addition, the Company confirmed that the construction phase has commenced on the iron ore beneficiation project in to initiate first stage commissioning by year’s end and deliver maiden revenues in 1H 2012."
"The beneficiation project remains on track to meet these milestones."
2, NSL predicted "only 90 days to recover the total investment" after production running in Dec, the mining opreation will provide USD$ 800k net cash flow per month--which is circa A$10 million per year.
Overall iron ore production cost is $55/t, profit margin is rought $50-60/t. This is reasonable, supported by the low labour cost in India--In AUS is not possible at all.
3, SH should notice that "NSL is so far the only foreign company granted the right to own and operate iron ore mines in India, which is the world’s third largest iron ore exporter", many of you may ignore this info, but for me it's very important, because this means NSL's success would be important for India gov as well, if first foreign iron ore miner canot make decent profit, how to attract other foreign investment in iron ore industry? So, logiclly, The India/local gov will fully support NSL's production and make NSL as a showcase for foreign investors.
1, The bigest achievement in last Friday is the SP breaking 6.7c, close at avove 7c, technically, this has confirmed the ongoing uptrend and there is no more significant resistance between 7c to 10c-- gap already been filled.
There is only less than 900k shares offered for sale under 10c, sale side is get extremly thining.
2, 350m shares on issue, potential net cash flow U$800k/month, $10million/year= circa 3c/share net profit before tax = 2c net profit/y after tax.
At PE 10, the fair value for SP should be 10*2c=20c, NSL also mentioned it could process the local iron ore stock owned by local small miners using extra capacity,which should generate extra profits; the ongoing exploration to improve JORC to above 100Mt should also increase the PE by 2 or 3. So logiclly, the PE should be 15, the fair SP should be 30c --achievable in next 6 month.
3, Coal resource
EER has $45m-120m MC in last 6 month, I noticed NSL's coal resource has at least 5 times higher than EER, coal seam thickness nearly doubled. But as NSL's coal project is at very early stage, I reckon $50-70million valuation is fair and conservative.
So ATM, we should add 15c to 20c to the SP valuation, plus the above upcoming Iron ore production, the total fair SP is between 35c (at PE10)--50c (at PE 15)
Once initial coal exploration successful like ICX, the coal resource valuation can easily pass $150 Million mark.
Which could result the SP in exceeding $1.0.
Good luck SHs, obviously not a good time for sale when you know only 30 days left for our first batch of iron ore product.
NSL Price at posting:
7.1¢ Sentiment: LT Buy Disclosure: Held
(20min delay)