Both the results from the scoping study and the progressive release of JORC resources for the Coalspur project should move the share price significantly.
Not that I am a true believer in Broker valuations but Patersons have a 50c valuation on CPL which currently attributes no value to the Coalspur leases as there is no JORC. It has been mentioned several times on the CPL thread that management believe the Coalspur project will bring them to somewhere near 1 billion tonnes of coal for both the Hinton and Coalspur projects combined. This therefore means the Coalspur project will add approx 550 million tonnes. At a Patersons valuation of 50c per tonne in situ a new valuation should sit at somewhere near $1 a share (very rough calculation).
Now the best part of all of this is that management projections are based on existing data in that the Coalspur project was subject to a Bankable Feasibility Study in the early 1980's by then owner Denison Mines (Dentherm Resources). Let's not forget that both the current CEO, Gene Wusaty, and newly appointed Vice President of Operations, Denis Lehoux, both worked for Denison on the Coalspur Project so they know exactly what they have.
Given a BFS has previously been completed on the Coalspur Project we should have a combined JORC resource of somewhere near 1 billion tonnes progressively reached within the next month or two and with that and the results of the scoping study, a considerable re-rating by the market.
As an aside it is interesting to note that Citi Group has recently issued an updated valuation for thermal coal of $105 US per tonne this year and averaging close to US $100 per tonne for the next 3 years.
I believe investors will be well rewarded over the next month or so.
Regards
Danash
CPL Price at posting:
35.0¢ Sentiment: Buy Disclosure: Held
(20min delay)