Energybuild Share Discussion Threads

[roks] 18/6/2008 14:56

Thanks Lasata, that was a good read.

[lasata] 18/6/2008 14:46

Minesite article posted 198

June 17, 2008

Energybuild Less Likely To Be Misunderstood Once It's Producing 440,000 Tonnes Of Coal Per Year


By Our Man In The City



"I tell the story of Energybuild and how we are keeping coal mining alive in Wales and people just respond by asking 'When are you starting production?'", says managing director Rhidian Davies. "It's frustrating when we've actually been selling coal for years". It's easy to see why Energybuild is misunderstood. Since listing on Aim last summer, the company has primarily talked about redeveloping the former British Coal-owned Aberpergym mine, near Neath in South Wales. With a current production target for the year to 30th June of 22,000 tonnes of coal, Aberpergym can hardly be considered large-scale. And the 2,000 tonnes a week that comes out of the company's Nant y Mynydd opencast mine next door is also relatively small-scale for coal miners. But it's the planned ramp-up of production that Rhidian wants to be judged on. In 2009, Energybuild aims to produce 265,000 tonnes of coal, rising to 440,000 tonnes by 2010.
To help the market get a better understanding of its current assets and development plans, Energybuild hosted two days of site visits for investors, analysts and the media including Minews. Upon entering Aberpergym, it becomes immediately clear that the underground infrastructure is far more sophisticated that one might expect for a junior mining company. The old British Coal workings remain in good shape, with solid steel supports propping up a maze of tunnels that runs deep into a Welsh mountain. Rhidian and his team have completed the first stage of their development programme, repairing the infrastructure and introducing new machinery to speed up production.

The next task in hand is a new drift to increase ventilation so more coal can be extracted without methane levels getting too high. Cambrian Mining, which owns 50 per cent of Energybuild in conjunction with Coal International, is on site to assist with the 18-month project. Colin Stocks, a senior mining engineer at Cambrian, says he spends ten days a month in Wales offering technical assistance and ensuring that his employer's investment is paying off.

Energybuild's reserves include low-sulphur coal that commands a premium selling price. This, together with the general price rise across the board in coal, will help to offset the relatively high underground production costs. "It's £51 per tonne to get coal out from underground, but only £20 per tonne for the open cast mining", says Rhidian. "Once we get the volumes up, the underground costs should ease back to the mid twenties."

Energybuild has 12 months' reserves left on the Aberpergym open cast mine and is evaluating a further three projects. "There's a possibly of extending the existing open cast operation, but it all depends on getting planning permission," comments Rhidian. As ATH Resources has found out over the past few years, planning permission is one of the biggest challenges for a coal miner in the UK, as there are plenty of people who don't want to see an ugly coal pit on their doorstep. Energybuild seems confident of getting the green light from the planning committee because of its contribution to the local economy and the jobs that will be created.

The Welsh Assembly has so far been co-operative towards the company's developments, most recently contributing towards the costs of re-training former Tower Colliery workers who are now working for Energybuild. Rhidian hopes the company will also get financial assistance for a conveyor belt from its mines to the rail head, so that it doesn't have to transport the coal by truck. A decision may take some time, but Rhidian is already arguing that as the Scottish Executive gave a grant towards ATH Resources' 12.2 kilometre conveyor belt from the Glenmuckloch mine, so Wales should do the same.

There are many ventures keeping Rhidian and his team excited about coal. If they can achieve the sharp ramp-up in production over the next few years, then Energybuild won't have to worry about people misunderstanding the business, as its name will be hard to miss in the industry.

[lasata] 18/6/2008 14:44

Perhaps CBM will takeover EBG at a fair price sometime

[roks] 18/6/2008 12:54

CLN owns 25% and CBM own 25%, CBM bought CLN, so CBM now owns 50% of EBG......I think taths how it works...

[jonwig] 18/6/2008 07:39

Minesite article, dated yesterday.
(Register first - free)

[cool hand kev] 17/6/2008 23:04

roks:why whats the connection?

[golspie] 17/6/2008 21:06

I m smiling here which is not what i am doing on MDX! Buy and hold looks okay here.

[roks] 16/6/2008 12:14

thats good to know....LOL.
I beginng to think that no boday knows about this company. With the takeover of CLN etc I thought there might some activity here.

[pyglet] 13/6/2008 17:39

i'm with you.

[roks] 13/6/2008 16:47

another good day here....feels like I'm on me own here.....

[roks] 13/6/2008 11:07

is this a break out?

[roks] 12/6/2008 16:46

nice finish, let hope it continues tomorrow.

[roks] 12/6/2008 09:28

Looks like its trying 30 again.....hopefully it will penetrate through this time....

[2pointers] 12/6/2008 08:44

Cheers Jonwig, I have a good feeling about these on the whole. Wish I had got them at a better price though.

Any new from the site visit anyone.

[jonwig] 10/6/2008 17:31

2pointers ... they've referred to the sandstone seam on a couple of occasions, in very positive terms.

It's a potential revenue stream, they can either get someone to pay them to quarry it, or do it themselves.
Pretty expensive stuff, pure sandstone ... even with a housing crash.

I suppose it might have been coal - that's the only negative which springs to mind!

[2pointers] 10/6/2008 15:18

Does anyone know much about this sand stone seam they have come accross and if there is much money in it? I took this as a bit of a negative.

looking forward to hearing your news from the visit Lasata.

[bubface] 10/6/2008 11:35

would like to get involved but the spread is such a killer over 12%.there are no low prints near the offer showing so it could just be a defensive markdown by the mm's who are long of stock in the mid twenties and don't want any more before clearing some inventory...might get an opportunity if someone panics.

[bossman1978] 10/6/2008 11:25

Big fall today, anyone any thoughts? I thought we might see a little rise ahead of the mine visit

[bossman1978] 09/6/2008 15:53

sorry, i see it is
wednesday

[bossman1978] 09/6/2008 15:42

When is the mine tour this week?

[roks] 06/6/2008 12:32

Not holding up very well......

[golspie] 05/6/2008 22:46

Given that pre-float the talk was a listing at 40p this rise is overdue. If the cambrian Coal merger goes ahead I will worry about what will happen to EBG. I would have thought the concert party permit ' flotation should no longe apply.

From a conversation with a director i think the prospects are good though capital expenditure will be needed.

[steban01] 05/6/2008 15:50

They'll take you away if you keep talking to yourself, then you'll miss all the action.

Still looking good, tiny drop this pm.

[lasata] 05/6/2008 14:47

Talking to myself again but i don't think that i shall be after end of next week......

Very close to breakout now.