News

December 15, 2008

Churchill Mining Should Be Producing Coal From East Kutai By The End Of Next Year

By Alastair Ford

There’s a very simple yardstick at the moment by which you can tell which companies are either about to go under, are in frantic negotiations, or at the very least are running scared – these are simply the ones that consistently aren’t returning calls. It’s classic psychology for those that get in to trouble with debt – barricade the door and don’t open the mail. It also works in reverse, as companies that are desperate not to let short-sellers or some spark of negative sentiment put the squeeze on their shares are clamoring even louder to be heard, especially if their fundamentals are sound. “We’re still here! Don’t burn us for no reason!” Old lags may scoff at those minnows who are wandering around town at the moment talking up their own potential positions as consolidators in a sector awash with weakness, but at least these guys are making noise, so we know they’re still alive. You have to do that at the moment. And God knows, somewhere in the middle of all this, it’s still possible to find a sensible mining company or two.

Churchill Mining is one such. It has £6.6 million in the bank and a 35 per cent stake in Australian-listed Spitfire Resources that’s worth around another A$1 million, so the cracks are not yet showing on that score. It also has 1.4 billion tonnes of coal in the ground on its East Kutai property in Kalimantan, Indonesia, coal that may be coming out of the ground by as early as the end of next year. And the negotiations the company is in, as regards moving that coal to production are far from...