buy side disappeared, page-13

The macro environment is going from bad to worse - everything is getting hit with no end in sight except for the occassional meaningless comment from Bernanke, Merkel, Rajoy and Draghi with a few days respite.
CLR has a fantastic little deposit of Met Coal at Grosvenor West with some nice little exploration plays, plenty of cash to see it through 1.5 years of exploration and pain.
If you take Helmsec's analysis of CLR (consultant and shareholder - perhaps bias????). They value Grosv West at between $2.66 & $3.28 per share UNRISKED based on mining method.
The "problem" with CLR is that it is a high cost operation and is highly leveraged to the coal price. Helmsec have used $200/T to arrive at their valuation. Every 10% movement in the coal price increases or decreses the per share valuation by $1.47. Likewise they have used an exchange rate of AUD0.875/ 1USD - the leverage is that every 5c move in the exch rate increases or decreses the per share valuation by $0.87.
If Grosvenor West was producing today (someone injected $1billion - CLRs other problem) at a coal price of circa $180T and an exchange rate of 1/1 parity - the Helmsecs value of CLR at todays spot prices would be negative $1 per share to negative $0.36 per share depending on mining method.
That is stock specific, of course if you have a long term (5 years) bullish view on coal which I do then the reverse is the case and CLR would be a strong performer in time.
Grosvenor West is not economic at current exchange rate and coal price and will not secure funding, hard to see a JV solving these problems. One for the bottom drawer and averaging down if you can + hope manangement conserve cash to avoid dilution / cash raisings
Disclosure : bought $1.60s - sold between $1.30 to $1.05, if they fall 50% from here I will be buying with a 5 year view / dont expect they will go that low though.
Definately a hold if you are in and dont need to sell