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MLM and Metrocoal and Cape Alumina

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I see the floating of Metrocoal (MLM 100%)(pending satisfactory drilling currently underway) and Cape Alumina (40% MLM) as a massive upside surprise to the market once the listings are approved and taken forward.

He's some detail on Metrocoal from their website:


Queensland Focussed - One of the Best Coal Regions in the World Metrocoal Ltd. is an Australian–based mineral exploration company focused on its coal projects in the Surat Coal Basin locations of South East Queensland
Currently privately owned subsidiary of ASX listed Metallica Minerals Limited.

The 100% owned project tenements cover a total of 4,000 km˛ in Queensland’s productive coal region and have extensive coal bearing strata 3 coal projects (Surat, Ipswich & Injune) with extensive coal bearing strata targeting depths 130m - 300m for Underground Coal Gasification (UCG) as well as open pit coal potential <100m

100% owned tenements.

Value Adding Strategy

Utilising "new" technologies (Underground Coal Gasification - UCG) Spinoff of divestment from successful ASX listed Nickel focused company (ASX – MLM)

Proven Brisbane based team.

Metrocoal has an Edge “Latest” technology enhances portfolio High hydrogen Surat Basin coal suits CTL and Coal Gasification.

Previous work on tenements provides confidence of there being extensive and exploitable coal deposits and data base for further work.

Exploration Target > 1Bt Coal
<300m depth + seam thickness 3m

Metrocoal Summary

Shallow, deep coal utilising UCG technologies
4,000km˛ coal tenements in currently under utilised but coal-rich Surat Basin.

Excellent locations for infrastructure.

Low sovereign risk.

Experienced team with successful ASX track record.

Clear strategy for diversified growth in Southeast Qld Coal and Energy.

Cape Alumina:

An initial resource statement released in January 2007 of 54 million tonnes of indicated
and inferred in-situ bauxite. Further drilling aimed at defining 10-15 year mine life
based on 7mtpa of pisolitic bauxite production.


Export Export revenue of A$250m-$300m pa (subject to positive feasibility study). Export
Sales proposed to Xinfa, one of China’s largest bauxite importers and other Chinese alumina majors.

What's 40% of just that mean for MLM?
How they can be trading at this MC is a bit odd.

Looking forward to drill results and getting on board the IPOs!

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Updated 23rd-June-2008 at 09:26 AM by kennas



  1. Miner's Avatar
    Thanks for MLM update Sean

    Could you please advise who is the sponsoring broker

  2. kennas's Avatar
    Just added some stuff on Cape Alumina too.

    Not sure about brokers.

    Need to call.
  3. kennas's Avatar
    MC just over $50m with potential revenue from CA $250-300m at 40% = $100-120m alone.

    Longer term looks undervalued just on CA.

    Throw in the coal and Ni...and 25m Cockatoo Coal shares.
  4. JTLP's Avatar
    Haha kennas a bit of analysis on MLM i like it. I too am waiting for a re-rating...damn 60!

    Can you tell me this...when they spin off these IPO's, do MLM still share in the benefits/rewards of these spin off companies? (i.e. profits etc as they are under the one umbrella) Or are they now considered seperate entities?

  5. kennas's Avatar
    MLM will hold a certain % of each newly listed company. Ann just out on seed financing for the Metrocoal IPO. All done. MLM retains 84% at this stage. Interesting they got the financing before drill results. Market doesn't know these guys exist yet by the looks. Probably due to their focus on Ni. Not a really sexy project IMO, but will be a cash earner eventually. The spec appeal is the Coal for me.
  6. JTLP's Avatar
    Haha thanks mate!

    Would you look at that...my questions are answered. MLM retaining 84% seems good...do they then distribute a % of this to shareholders? If so, please be tiny !
  7. Miner's Avatar
    thanks Kennas and JTC

    Weipa is bloody rich with alumina in Cape York
    No crusher or digger - Rio Tinto just digs the ore with no blasting. Very rick resources, Alcan used to have thousands of sq km of alumina there and now with take over it is very rich again.
    Now with Cape Alumina there MLM will be interesting
    I have lived and worked in Weipa for Rio and if MLM stake is equally bigger then the opportunity for them will be explore and sell to Rio back. It will not be cost viable feasible option for any third party to set up a new plant in Weipa as per my understanding - but you never know any way
  8. kennas's Avatar
    Yep, looks like an easy operation. I've tried to find where the RIO operation is in relation to Cape A, but can't find it. Any ideas? Potential for an offer from RIO down the track perhaps? Obviously MLMs 40% would be a hurdle.
  9. kennas's Avatar
    Regarding IPOs and allocation for MLM holders:

    Thanks Sean,

    At this stage we have reserved 2 million Cape shares ($1 million) out of a likely retail total of $8-$10 million for Metallica shareholders. The shares will probably be allocated to Metallica shareholders informally by for example, getting them to return their applications to the Metallica office.

    Metrocoal is a little further away as an IPO, but at this stage, we would expect a similar mechanism to apply.

    Hope that is of some help.


    John Haley
    Director/CFO/Company Secretary
    Metallica Minerals Limited
  10. mu5hu's Avatar

    Just to clarify, the IPO for Metrocoal won't be floated till later this year or maybe early 2009? So the ex-record date hasn't been annoucened yeah?

  11. kennas's Avatar
    Yes, seems some time off.

    In the meantime, the sp will be effected more by Ni prices and general market sentiment. Looks pretty choppy right now and we need a long term vision.

    I'm not holding many really, and am waiting for that 60 level to break to jump in head first.
  12. kennas's Avatar
    Hooly dooly, what an upgrade to Cape A.

    Double the resource.

    When the market wakes up. he he he....

    Cape Alumina doubles resource at Pisolite Hills Project to 100 million tonnes of insitu bauxite

    Cape Alumina has today released details of a doubling in bauxite resources for its Pisolite Hills project on the Weipa bauxite plateau of western Cape York, Queensland.

    The new resource statement, which now represents a Mineral Resource of 100.8 million tonnes of Indicated (75.8 Mt) and Inferred (25.0 Mt) insitu bauxite, is the first since the Company’s maiden resource statement in January 2007.
  13. JTLP's Avatar
    I reckon Kennas...when will mister Market wake up and smell the Bauxite/Coal/Nickle...LOL.

    It was nice to end the day on 50 cents; there just seems to be a lot of selling pressure atm.

    Does anybody know when MLM plan to sink some drills into their coal grounds and get some resource estimates? Maybe that will send a nice rocket under the SP (roll eyes here)
  14. kennas's Avatar
    They are drilling the coal right now.
  15. JTLP's Avatar
    Thanks Kennas.

    Maybe if MLM gets its much warranted rerating we can have a beer in Mexico...have you been to Cabo? It looks lovely :P!



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