News

April 07, 2008

Cambrian Mining Tries To Extricate Itself From Its Own Tangled Web… Yet Again

By Alastair Ford

It must have been more by accident than design that Mark Burridge, chief executive of Cambrian Mining, chose to release the results of his company’s strategic review on the very day that the market learned that BHPBilliton and Rio Tinto are likely to raise the price they charge customers in the Far East for coking coal by 200 per cent. Cambrian has plenty of this high quality coal, also known as metallurgical coal, inside key strategic investment Western Canadian Coal. The Perry Creek and EB deposits on Western’s Wolverine property in British Columbia hold a total of 26.7 million tonnes of saleable export metallurgical coal, according to a 43-101 report compiled in 2006. There’s also metallurgical coal at two assets belonging to 34 per cent-owned Coal International in West Virginia.

So fair play to Cambrian - coal’s a nice space to be in right now, as supply is tight and likely to stay that way, and that’s something the founder directors have been banging on about for a few years now. Cambrian’s certainly no Johnny-come-lately cashing in on the recent strength. It’s ridden out highs and lows with Western Canadian and Coal International, and now looks set to reap the benefits. Except there’s a catch, and there has been all along. Add the value of Cambrian’s stake in Western...