cgv_cxy comparisons, page-3

Further comments on CXY thread as followed:-

Sungar,

They are not drilling 1507, they are drilling 1506 and 1539 accoriding to the drilling announcements.

In 1982 when 1506 & 1539 were relinquished the margins in open cut mining allowed for, at best 3:1 strip ratios. Today 7:1 and higher is still profitable open cut mining. Banding is common and easily and in-expensively separated.

I tend to agree that the QLD government won't change its policy soon, especially if Arrow accept the Shell/PetroChina offer. Shell/PetroChina will seek similar commitments as the British Gas (BG) deal for Queensland Gas which will see the review period for UCG extended. Bligh can't reject their request given she has already set a precedent.

Apart from the Shell/PetroChina, Arrow issue, there has been no positive government news on UCG and it's blatenetly obvious that the QLD government is right behind CSG. And when you consider the multi-billion dollar cost of the proposed LNG plants, Surat to Gladstone pipeline and all the other mega CSG deals getting done in Queensland, its unlikely the QLD would want any of that investment to be jeopardised. Why do you think Linc is proposing to go to SA for their first commercial plant?

CGV's comment in relation to commercialising UCG in QLD did state "in the near future" which suggests they do believe commercial UCG in QLD will happen, but not soon. From memory the policy outlined a report to be completed between December 2010 and December 2011 with the report to be tabled in 2011/2012. That means its highly unlikely that any commercial UCG project would be considered for approval before 2012. This to me, and I would imagine any other reasonable person, would support CGV's claim of no commercial UCG in QLD "in the near future".

If you followed your logic in relation to Ergo's connectoin to the last remaining commercial UCG plant, we'd only invest in Linc because they now on more than 70% of Yerostigaz, the Angren UCG operators. Blinderman (Ergo) is ex.

I don't think I implied it was a race to the finish, more who can commercialise UCG for the least amount of capital.

CGV have higlighted they will need to complete further capital raisings, that's obvious. However, if they come up with a coal resource that they can sell this eliminates going to the market. And I'm sure they will be more realistic on the pricing of any coal resource they find compared to Linc.

I don't know you'll find CGV much cheaper than what they are.

Cheers
SG