HUN - Hunnu Coal

[Bushman]

Thread starter on a new coal IPO - Hunnu Coal Limited.

It has the following coal exploration targets in Mongolia:

ArZuulGol& ZuunGolProjects 200 Mt target, Advanced exploration

TsagaanDelgerProject 100 Mt target, Grass roots exploration

DelgerehProject 50 Mt target, Grass roots exploration

MunhHaanProject 50 Mt target, Grass roots exploration

Some large numbers there and Mongolia is close to China. Tight capital structure and likely newsflow in 2010 and beyond. Mongolia is certainly and emerging commodities market.

On the watch list; DYOR.

 

[Mondaine]

Too right Bushman.

Hard to believe that anyone has missed this, up 100% on the float (20c to 41c opening day, current price 37.5c). Higher highs, higher lows. Once this is discovered then it will go up (like most other coal producers at the moment). Coal stocks had a bit of a scare with the China slowdown, but reducing the stimulus isn't reducing demand much. China is still blistering. Coal is used as part of the aluminum production process, aluminum for new cars. With the Indian and Chinese consumers buying cars the demand is there.

Will post some information on other coal producers, it makes for pleasant reading.

Could be the next SMR.

Mondaine

 

[Riddick]

Too right,

Definitely seems to have flown under the radar somewhat. Upon investigation HUN seems like it could have a bit of promise:

1. It has 9 exploration licenses in five provinces across the country.
2. Significant stakes in projects that are in the final stages of exploration planning, having been strategised and timelined and, it would seem, funded too.

Most importantly though it seems the board have a bit of knowledge about what is actually below the ground. That is, G.Tumur has first hand experience in digging coal out of the ground in Mongolia and it would seem incredulous that he would have no idea of the potential of this type of play in this country. Looking at the to 20 shareholders list it would seem there is lots of big money that thinks likewise. Some mega action.

And with drilling as early as April this year it looks like HUN is a very considered operation. I.e they know what is there and have made a pretty good plan as to how they are going to get it out and who they are going to sell it to. IMHO that is.

Well done to those that picked it up early!

 

[Mondaine]

You can say that again Riddick... Some floats *cough* cbio *cough* provide a surprise of the wrong kind on their first day trading, I'd like to get 75% on the open.

 

[slinky]

I have also taken an interest in this stock

They're going to acquire an additional thermal coal project in Mongolia.
"The Company has an exploration target* of 40Mt to 60Mt for the Erdenes Coal Project based on existing exploration work."

Taken from the 10/3/2010 asx announcement

Will be interesting see what unfolds for them this year - I have high expectations (just MY gut feeling!)

 

[DVEOUS]

I may be a bit slow, but coal has just appeared on my radar.

With the dramatic rises in CEY and the like, it will be interesting to see what happens with HUN, when it comes out of a trading halt on Monday.

I wonder if it would be too late to jump on board at the market rate for HUN come 10am Monday morning???

 

[J&M]

Got these at .44 18Th Feb now up to .88 should have brought more

This is copied from the last Ann. 12/4/09 I am no miner but seems to be a lot of coal with easy access.


The Company is very pleased to announce that it is acquiring a 60% interest in the Unst Khudag Coal Mine and surrounding licenses, which are located in the Dundgobi Province of Mongolia.
The Unst Khudag Coal Mine is strategically located 200km from an operational multi party coal loading facility on a major rail line.
Consists of two Exploration Licenses and one Mining License covering over 59,000 hectares.
Approved Mining Plan and Feasibility Study for the mining of 98.7Mt of coal.
Hunnu is targeting first production from the Unst Khudag Coal Mine in the latter half of 2010.
Off-take agreements are currently being discussed with Mongolian and Chinese coal users.
Exploration Target of 250Mt to 500Mt.*
Past trial production of approximately 30,000t for bulk test work with potential off-take partners and local utilities.
Single coal seam with average thickness of 20 metres dipping at 0 to 5 degrees.
Coal at less than 4 metres from the surface.
Low strip ratio at less than 1:1 from startup.
Coal analysis reveals high quality thermal coal with quality parameters on average Qdaf = 6460 kCal/kg, Ash = 13.9% and Moisture content = 23.9%.
The Unst Khudag Coal Mine is located in Dundgobi province, 290km from Ulaanbaatar, and approximately 200km from the Mongolian railway grid. The project consists of two exploration licenses and one mining license covering over 59,000 hectares of area. The mining license covers approximately 1,600 hectares, on which the relevant government authority have approved the mining of 98.7Mt of coal.
Exploration programmes undertaken at Unst Khudag have included mapping at various scales, trenching, geophysical surveys and drilling. A total of 39 drill holes have been completed to depths less than 100 metres deep. Drilling has intersected a single coal seam with thicknesses varying from 5 to 31 metres. The coal seam has approximately four metres of unconsolidated overburden and dips under cover gently at zero to five degrees.

 

[vincent191]

It is worth pointing out that Mongolia has worldclass
deposits, but is unlikely to develop them any
time soon. There are just too many hurdles in terms
of rights, regulations, and infrastructure.

Quote from Investment newsletter that I subscribe to.

 

[J&M]

Vincent
I tried to find a link to the investor mag you were talking about
Do you have a link to the web site or the full name of the mag.

All I found was lots of sites talking about the new lease

Thanks
James

 

[vincent191]

Vincent
I tried to find a link to the investor mag you were talking about
Do you have a link to the web site or the full name of the mag.

All I found was lots of sites talking about the new lease

Thanks
James

The newsletter is called Diggers & Drillers. I love to cut and paste the bit about Mongolia here but it will infringe copy right rules and will not impress the moderators.

 

[GumbyLearner]

Does anyone know how proximate any of the Hunnu tenements are from the RIO/IVA Oyu Tolgoi mine development?

 

[DVEOUS]

Does anyone know how proximate any of the Hunnu tenements are from the RIO/IVA Oyu Tolgoi mine development?

I didn't know RIO had any interests in the area.
Thanks for the heads-up.

Having started a bit of research, I found an interesting map;
http://www.southgobi.com/i/pdf/PropertyMap.pdf
This is from SouthGobi Energy Resources, who Ivanhoe Mines have an interest, who in turn RIO have an interest in.

One thing of great interest, you will note, are the two new railway lines that are under construction now. (The green lines). Assuming HUN get access to these lines, it will make it easier to bring coal to market. The map is quite informative. I didn't realise the proximity of Baotou and Jiayuguan steel making centres. Why wouldn't the Chinese like coal from Mongolia.

The recent run on HUN (coming out of trading halt on Monday) was due to the news of their acquisition of a 60% interest in the Unst KHudag coal mine. But this mine is located in the Dundgobi (or Dundgovi) province, which is to the north of where the IVA mine is.

However, HUN have EL15147 and EL14049 in the vicinity of the IVA mine, near the town of Dalanzadgad.
I think these two ELs relate to what Hunnu call Tenuun-2 & Khuree-2.
http://www.hunnucoal.com/Tenuun2AndKhuree2Projects.html

... which all appear to be in the same area.

 

[DVEOUS]

So who do you think is actually buying Hunnu Coal???

I have been sitting on the sidelines for the last 10 days, watching, thinking it can't possibly go any higher... yet it does.
And each day I have been kicking myself that I didn't get in the day before.
This bubble has to burst sooner or later.

There has been no main stream media coverage on this stock, so I am wondering what is pushing HUN upwards?

 

[vincent191]

So who do you think is actually buying Hunnu Coal???

I have been sitting on the sidelines for the last 10 days, watching, thinking it can't possibly go any higher... yet it does.
And each day I have been kicking myself that I didn't get in the day before.
This bubble has to burst sooner or later.

There has been no main stream media coverage on this stock, so I am wondering what is pushing HUN upwards?

IMO HUN is a good long term investment. As I quoted earlier it will take a years to finish the railway and a coal port and there are lots of hurdles to overcome before production can even start. Just look how long it takes in Australia to go from discovering a resource to production start up. I estimate three to five years just for the mine.

I will give you a first hand experience I had years ago in that part of the world (not Mongolia but Inner Mongolia). They just started a large coal mine and they were hauling it by rail to somewhere in China, the train made very frequent and long stops because it also hauled passenger compartments!!! Everytime it stopped peasants could come out and help themselves to the coal !!! Worst still, they started using the train as a moving garbage disposal unit and tossed all the rubbish into the now half empty carriage. Eventually when the cargo reached it's destination, the Client got less than they expected and half of it is rubbish!!!

But, general opinion is Mongolia promises to hold many world class resources including Gold that is why many major mining companies are already setting up in Mongolia and helping them to setup mining codes. It is very much a matter of first in, best dress.

IMO, if your investment horizon is long term then HUN is most probably not a bad choice. This is only a very brief and general post, DYOR.

 

[slinky]

The sp is really taking a hit today. Down 8.7% for the day as I type

Which is good news for me. I can now buy more

 

[J&M]

I am also new to trading I sold 3000 at the high price and
re-invested the same amount at a lower price and got 3200 then the price went up again
first time I have done this
Still being very careful with shares

James

 

[DVEOUS]

The upbeat mood on this stock (after it came out of trading halt) did last a week longer than what I was expecting, so not wanting to wait any longer, I finally got in yesterday at $1.16... and, considering the general market mood in recent days, I really regret not waiting another 24 hours to see if was to bottom out more!

It see it got down to $1.01 today, and it was very tempting to accumulate, but how much further will it slip? The $64 question.

The next week or so should start to give an indication of where the resistance point is.
After all, this newly listed stock is in unchartered territory, so it is difficult to know at what price would be good for a re-entry.

 

[J&M]

Just a quick up date on the progress of Hunnu coal

I see this is a strip mine and close to the surface
Train lines close by
The shares dropped sightly today ????



COMMENCEMENT OF DRILLING AT THE UNST KHUDAG COAL MINE
The Company is very pleased to announce that it has commenced an exploration and development drilling programme at the 60% owned Unst Khudag Coal Mine and surrounding exploration licenses. The Unst Khudag Coal Mine is located in Dundgobi Province of Mongolia and is being developed by Hunnu Coal to deliver high quality premium thermal coal to both domestic and Chinese off-take customers.

The Unst Khudag Coal Mine is strategically located 200km from an operational multi party coal loading facility on a major rail line.

Consists of two Exploration Licenses and one Mining License covering over 59,000 hectares of area.

Approved Mining Plan and Feasibility Study for the mining of 98.7Mt of coal.

Hunnu is targeting first production from the Unst Khudag Coal Mine in the latter half of 2010.

Off-take agreements are currently being negotiated with Mongolian and Chinese thermal coal users.

Exploration Target* of 250Mt to 500Mt

Past trial production of approximately 30,000t for bulk test work with potential off-take partners and to local customers

Single coal seam with average thickness of 20 metres dipping at 0 to 5 degrees.

Coal at less than 4 metres from the surface.

Low strip ratio mine start up at less than 1:1.

Coal analysis reveals a high quality thermal coal with quality parameters in average Qdaf = 6,460 kCal/kg, Ash = 13.9% and Moisture content = 23.9%.

Three drilling rigs currently operating on site.
The Unst Khudag Coal Mine is located 290km from Ulaanbaatar, and approximately 200km from the Mongolian railway grid. The project consists of two exploration licenses and one mining license covering over 59,000 hectares of area. The mining license area covers approximately 1,600 hectares of area, on which the relevant

 

[adobee]

Got a package of these today... Same storey as above but its all coming together pretty quickly.. loving the Mongolian storey at the moment !

 

[adobee]

The Bull Steven Hing, Novus Capital
BUY RECOMMENDATIONS
Hunnu Coal (HUN)

JORC & Offtake agreement announcements expected in December.