BFE - Black Fire Minerals

[bhutos]

Thought i'd start a bit of a thread on BFE giving they're due to spud Moriary in the next day or so. EGO is going to attract most of the attention, but it'll be BFE/BFEO sitting on the sidelines with better leverage (BFEO at any rate) that could be very interesting to hold through to Lake Macleod. LGO has great leverage on the heads, but with 141k cash on hand it's not quite as sturdy.
I'm not overly concerned with Moriary, but it's a good time to position for Macleod's April/May drill. Director just bought shares.

Moriary: 3.5-11mmbbl - 10% BFE
Lake Macleod: 150mmbbl - 7.5% BFE

Cash on hand: 3.174M
Shares on Issue 61.5M: 30,750,000 BFE | 30,750,000 BFEO (EXP 2010)

 

[surfingman]

Re: BFE - Blue Fire Energy

Thought i'd start a bit of a thread on BFE giving they're due to spud Moriary in the next day or so. EGO is going to attract most of the attention, but it'll be BFE/BFEO sitting on the sidelines with better leverage (BFEO at any rate) that could be very interesting to hold through to Lake Macleod. LGO has great leverage on the heads, but with 141k cash on hand it's not quite as sturdy.
I'm not overly concerned with Moriary, but it's a good time to position for Macleod's April/May drill. Director just bought shares.

Moriary: 3.5-11mmbbl - 10% BFE
Lake Macleod: 150mmbbl - 7.5% BFE

Cash on hand: 3.174M
Shares on Issue 61.5M: 30,750,000 BFE | 30,750,000 BFEO (EXP 2010)

I think it's Black Fire Energy not Blue

Empire has a 40% exposure to Moriary, I am sure there will be a few supporters there also posting once it spuds.

 

[bhutos]

Re: BFE - Black Fire Energy

Nice, trading halt for a proposed aquisition, on top of the activity at Lake Macleod within the next month we should start to see a bit of a fire lit under this one.

 

[bhutos]

Re: BFE - Black Fire Energy

Nice, trading halt for a proposed aquisition, on top of the activity at Lake Macleod within the next month we should start to see a bit of a fire lit under this one.

Nice. Up 233% on open, close at 150% on BFEO, heads closed 40% up. Personally I think the direction is a little opportunistic but it's always been a nicely leveraged punt so I'm not going to argue.. provides a good floor in the event of failure at Lake MacLeod.

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

Guys just a quick heads up,

These are dirty markets and there are bargains galore, BFE is one I liked primarily as an Iron ore play in Africa, search through the ann's you'll find it,

But just realised they also offer massive leverage to the upcoming EGO Lake Macleod well

Also Steinpris bought 250k shares yesterday on mkt at 18c which clinched it for me


More info to come

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

More info as promissed,

Like I have said I am sticking with my strategy of buying dirt cheap (or at least what I think are dirt cheap, resource stocks in Iron Ore, Coal and Oil n Gas,

BFE fits the bill as an African Iron Ore play but also has its hooks in a very large upcomng Aust Oil well,

Chart wise 18c looks like support

But what has me really imoressed is that the famous Ascent Capital/Stienpris group who founded this company (like many others) are still buying on mkt, as if you read the ann you'll see they bought 250k yesterday at 18c, I see that as a real vote of confidence, what do they as directors and deal makers know that we as mug punters don't?

Also most importantly it says to me at these levels they are buyers and not sellers which in current mkts is very reasssuring as they are putting their oney on the line with mine

 

[smurfette]

Re: BFE - Black Fire Energy

Hi YT,
I like the mix of ironore and oil. I'm sure everyone will agree that you can't really go wrong putting your hard earnd in these areas. Director buying on market is healthy. You don't see that sort of thing that often any more.

Comsec shows market cap as $5million. Looks light if it's got the backing of these big wigs as you say it does.


Smurfette

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

Smurfete where you been hiding during all this carnage? Don't hide in caves, bears live there! lol

BFE has 35M shares on issue with 20M to be issued as consideration for the project = 55M so at 18c the Mkt Cap is closer to $10m with $3m cash = EV of $7m

The company has acquired a project with a historical 400-600Mts averaging 30-35% Fe = 120-210Mt's of Magnetite

At 25c/t EV = $30m - $52.5m = 55c - $1 undiluted as a minimum value

All in all the company looks very cheap however so does the whole of the ASX, for me this is a buy and hold and wait for proper value/re-rating

No doubt EGO's upcoming Lake Macleod drilling in a few weeks will create alot of interest

 

[Sean K]

Re: BFE - Black Fire Energy

Yeah, looks a little undervalued LN.

These 2 slides from their last presentation sums them up.

The steel plants nearby are a little bonus. Just a little.

I personally don't care about the O&G potential, got no idea about O&G.

Agree with the .18 support, but under that it's looking dodgy.

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

Well finally a positive day in the US, hopefully sentiment clears up a nd people start looking for bargains,


It will be interesting to see if Steinpris continue to buy on mkt, I was thinking about this before, Steinpris/Ascent Capital, have hundreds and hundreds of deals and are worth hundreds of millions of dollars, now correct me if I'm wrong but I am pretty sure I haven't seen them buy stock on mkt for any other deals for a long time

Anyway, if there happy to be buyers at these levels thats good enough for me

 

[Sean K]

Re: BFE - Black Fire Energy

Hard chart on this one LN.

After it started down the fe way (spike) I'm not sure if you can include anything from before. Some residual investors from the oil days maybe, but they are probably happy with the new priority.

So, yes, .18 is current support, but under that, who knows. No mans land really.

If it hadn't have done the recap thing, then it's a tasty looking flag and pennant with a target around the 45c mark, but I don't think it's really valid. Not enough psychology vested in it.

Looks undervalued to me on the numbers. People won't be happy with W Africa, but having the King on the board might be an advantage. eeeek

 

[grace]

Re: BFE - Black Fire Energy

Market doesn't want to give much value to lower grade stuff at the moment unfortunately. Actually, market doesn't want to give much value to higher grade either.

As a comparison

Holding Brockman BRM
MC of $130 mill (excluding cash of $120mill).

1.1 billion jorc resource (50 mill DSO, balance upgradeable)
MC = 12 cents / tonne (before benefication)

After benefication 680 million tonne grading +59%
MC = 19 cents / tonne

Seems all of the iron ore juniors in the same boat at the moment.

 

[smurfette]

Re: BFE - Black Fire Energy

I took a deeper look last night

It has held up quite fine when one looks at its share price against the All Ords

19c seemed like a good level so I'm in just hope the markets have bottomed.


P.S, What King are you talking about Kennas The King Of Queens?

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

Hey Grace,

Yeah Mkt just isn't recognising value, along with the BRM comparison if you compare to DMM its even crazier,

However SDL ACS and NSL have all managed resonable EV's 25c+/t so there is still hope,

I thing the big+ here is as Kennas has pointed out readily available infrastructure ie rail and more importantly 2 Steel Plants in need of feeder ore

Still mkt cap is so damn small you can't go to wrong and these guys are notorious for pulling off excellent deals

 

[Sean K]

Re: BFE - Black Fire Energy

P.S, What King are you talking about Kennas The King Of Queens?

The King becomes the No 1 holder once the company reaches it's targets and issues shares to the principles.

He may have some influenece in getting things moving along.

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

We all know Africa is corrupt,

And so you either work against them or work with them,

I much prefer to align shareholder interests with that of management and in situations like this vendors of projects

How you ask? Well instead of paying $5m cash or $10m cash up front for a project, you give the vendors shares (what BFE is doing) further you escrow those shares for at least 12 months so they can't just dump those shares on the mkt (what BFE has done/will do)

That way in 12 months time the only way Mr King here will make money is if we too as shareholders make money, his interets are directly aligned with us as shareholders and thats the way it should be, if he wins we win, ie we all win, this also ensures he will try hard to make the project work and being the King and Soverign Ruler of the area I'd say BFE shouldn't have any political or country risk

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

In addition to aligning our interests with "The King" by having him as a major shareholder,

BFE has also ensured that we get first right of refusal of other projects, now considering BFE started off as an Oil explorer and Nigeria is one of the most prolific Oil provinces in the world I wouldn't be surprised to see some Oil related projects bought in


Oh and Kenaas, as I said don't discount BFE's 7% interest in Lake Macleod, EGO will grab the mkts attention leaidng up to spudding and this will rub off on BFE given its a partner

 

[smurfette]

Re: BFE - Black Fire Energy

Just read the asx release on the Iron Ore, so this King is he gonna be like Elvis? Seriously though I thought they had presidents now not Kings.... then again Mugabe is a dictator.

I agree when operating in such a corrupt area its very good to have the corrupt officials with you. As they say if you can't beat them join them...... or at least let them join you hey?

Also agree and like the fact that he is not getting paid cash but rather shares like you and me and like the fact that he can't just dump them and take his money and run.

So now I say we sit back and let the "King" build us an empire!!!!!


Smufette

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

lol so Elvis "The King" is alive and living in Nigeria? : lol

Yes Smurfete like I said what BFE have done is align shareholder interests with that of the vendor of the project (Elvis) by paying him in shares rather than cash and escrowing his shares for 12 months

18c is imo good support and after seeing Steinpris buy 250k at 18c a few days back it would not surprise me if some of those large orders at 17c are them

 

[YOUNG_TRADER]

Re: BFE - Black Fire Energy

This stock is sooo tight

Only 25k traded yesterday, sooner or later those buyers below 18c will have to realise that no one is selling below 18c and if they want volume they will have to pay up, heck the Steinpris directors realised that and hence they went up at 18c, not sure why the others don't

I suspect this will trade in a tight range of 18c-20c but will break out on the back of news/update of the current project, a new acquistion or even in the lead up to the spudding of Lake Macleod,

Also of interest are some of the substantial shareholders that have been buying on mkt,

EQT is a listed trust on the ASX and quite large by the looks of things, I wonder why or how a small micro cap like BFE caught their attention

http://www.eqt.com.au/home/default.asp

Adam Liernet is (according to my broker) a senior guy over at Bell Potter Stock Broking, again why or how BFE caught his attention and caused him to buy even in the 20's on mkt is a mystery to me

However the fact that all these groups are buyers and not selles at current levels explains why 18c is a floor on the stock,

I expect big things from this little one once the mkts settle