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LNC - Linc Energy

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Well we have had a string of strong announcements from LINC. There is no doubt the management is doing its best in the bear market of a century.

But LINC along with almost all other companies continues to fall rapidly.:(

The final reality of the project is still years away in terms of building and profitably running the UCG/GTL plants. What do other forum members think could be done between now and then to create and continue SP support for the company? Or is this unnecessary in the sense that in the end what will count is a productive, profitable plant?:confused:

Best ideas help to save all our bacon !

(I suppose this question covers all companies but I'm being selective)
 
Sell now and you will keep some bacon. Hold and youll be eating rice. Lincs initial price looks fair value.
 
basilio said:
Well we have had a string of strong announcements from LINC. There is no doubt the management is doing its best in the bear market of a century.

But LINC along with almost all other companies continues to fall rapidly.:(

The final reality of the project is still years away in terms of building and profitably running the UCG/GTL plants. What do other forum members think could be done between now and then to create and continue SP support for the company? Or is this unnecessary in the sense that in the end what will count is a productive, profitable plant?:confused:

Best ideas help to save all our bacon !

(I suppose this question covers all companies but I'm being selective)
Click to expand...

A $0.10 per share dividend late next year after the sale of both tenements has been finalised and tax has been paid on the sales would cost only $40 m and should be fully franked. If this intention was announced at next week's AGM it would encourage shareholders to hold onto their shares and put a floor of around $2.50 on the share price imho.
 
Mickel said:
Basilio, while PB mentions 1m bpd for 60 years I don't think he would start off with that. One 100,000bpd plant would be,as he says, 5 modules of 20,000bpd and Linc would probably start off with only that. I would also think constructing 5 modules at the same time would give some economies of scale-perhaps reducing each module to $700m-so that's $3.5b.

With the sale of 2 tenements for $1.5b (after tax) approx Linc could borrow $2b (from the future fund ?) or to sweeten the deal, Linc could issue shares for 10% of the borrowing total. Considering only a borrowing of $2b, and setting repayments (P&I) at $400m pa and using your back of envelope calculations (except they would be in USD), that would be $USD1.4b .Using exchange rate of .70 that is A$2.0b then deduct the loan repayment and you have A$1.6b or $4 per share before tax.

And that's not taking into account-
1. A premium for this ultra clean diesel
2. The other by products (which from memory were worth $40m pa on 20,000 bpd plant.)

Not bad for a start !!!

I would think that after the 1st 100,000 bpd plant was up and running they could start the next one, possibly constructing a 20,000 bpd module each year and funding it from cash flow. That way Linc could have almost a permanent construction team and reap many benefits from the experienced team.

I feel very lucky that I'm a shareholder in on the ground floor !!!
Click to expand...


Shareholder tours to the Chinchilla site from Brisbane commenced today and PB said (among other things) the SA GTL plant will start with one 20,000bpd module and the others(4) to follow in quick succession. So the back of the envelope numbers above will not happen for a number of years. PB stated he did not wish to fund any construction with debt.

He is very confident that the Chinese $1.5B sale will come through. They are in contact with the purchaser every week and are awaiting Chinese Govt approval for the funds to leave the country.

PB also said they are working on patents in the JV with BiocleanCoal and there should be some news in the 1st quarter of next year. They hope to have a demo bioreactor on the chinchilla site in the 3rd quarter of next year.

Did anyone else visit the site today or last week ?
 
Market up today by 5.8% but LNC up 11.6% to $2.60. Hopefully this will continue all this week with the added boost of AGM on Thursday.

PB also expressed his opinion at the site tour today that the market should rerate the stock to $4.00 when the chinese $1.5b sale is confirmed.
 
LNC about 2.50 now. $4 would be nice, but the market is so unreliable these day. Very volatile, so we just have to hang in there
 
done a bit of googling... will be interesting to see how the market takes this acquisition, in light of the fact we are still awaiting the cash from China...

Anyway - it appears that Gas Tech Inc, became GFS Corp (Brand?).

Seems like a good fit.. http://www.gfs-corp.net/about.php

"GFS Corp manufactures and sells equipment that enables diesel engines to operate on both diesel and natural gas. The company offers a full line of retrofit conversion systems covering a broad spectrum of diesel engines made by major manufacturers. GFS also offers project development services consolidating its proven Gaseous Fuel™ technologies with LNG/CNG production, storage, and distribution infrastructure into integrated projects throughout the world. GFS is also the Florida Master Distributor for the GTI-Altronic line of Bi-Fuel conversion technology for stationary applications."


Their big ticket item is the GFS:

The Gaseous Fuel System™ conversion technology has been designed to allow for retrofit of diesel engines without the need to change or modify the design of the engine. The The Gaseous Fuel System™ conversion hardware is mounted externally to the engine and does not require modification of the engine.


____

some background...

Gas Technologies, Inc. of Weston, Florida, the leading supplier in the design, manufacture, and application of bi-fuel conversion systems for industrial diesel-fueled engines was acquired in 2002. Bi-Fuel systems enable standard diesel engines to operate on a combination of diesel fuel and natural gas (up to as high as 70% natural gas content on an energy equivalent basis), typically with no change in engine power rating or efficiency. Fuel flexibility and all of the economies associated with such flexibility are the primary benefits to the customer. In most cases, natural gas is less expensive than the diesel fuel being replaced. Additional details on the GTI Bi-Fuel Systems can be found at www.gti-altronicinc.com.

The GTI product line will be marketed through large engine-generator packagers and engine accessory distributors. Altronic, Inc., is the leading producer of ignition systems for industrial engines worldwide and a producer of instruments and controls for engines and compressors.

--------------

PS - anyone see the Trading Halt sign and immediatley think the chinese cash was in the bank!!!
 
Trading Halt today for an announcement of some American company.
Looks like a big jump tomorrow considering the asking rate has been shown as $4 in ASX site.

I can see the grinned faces of LNC holders. I was waiting to buy it hoping :banghead: it will sink further (Sorry current holders);)
 

Attachments

  • LINC ENERGY 3DEC08 HALT.pdf
    106 KB · Views: 1
Trading halt

Interesting... Announcement is out in the media well ahead of a release to the ASX. Is this allowed because the company is in a trading halt? If the announcement is out, why is the trading halt not being lifted? All of us Linc holders would be hoping they announce the $1.5bil while they are at it!!
(Disclosure - holder)
 
Goldmann said:
also this may be of interest, delay of Monash/Shells Coal to Liquids JV:

http://business.smh.com.au/business/rising-costs-stall-monashs-clean-fuel-project-20081202-6pr1.html

and Miner - commsec is showing the anticipated indicative price of LINCs next open at $2.45. so you may still get your early entry.

The confirmation of the Chinese sale will be the only thing that drives LNC back to $4 (my opinion only).
Click to expand...

Thanks Goldmann for your 99th posting giving me some hope to buy LNC at $2.45 :D

I was talking with LNC Investment Relations person last week asking about the company's future considering it has risen and dipped much faster than market rise and fall. She obviously did not provide any guidance (legally not allowed to) but provided some good glossy documentation by mail which reads very good and have good information.
 
Miner - release out now to Joe Average (that being non-media sources through the ASX), and trading halt removed.

and price stablising mid 2.50's... $4 is still a long way away (well maybe not if they have the signed MOA for the Xinwyen Purchase!)

could be worse - could have a stack of OZ Min shares (apologies to those who do!)
 
Makes me happy i sold mine yesterday at 2.35 now I can buy in again at the top and do a repeat.
Still Oil is going down were does this leave LNC?
 
I think this is a very clever acquisition by LINC. Like the Sapex deal it brings in excellent coal reserves and the opportunity to establish a UCG/GTL plant on another site, this time in America with full control over the profits.:)

Linc pays in scrip so no cash outlay. Scrip is valued at $4.00 which in a sense improves the value for current shareholders. Of course the shareholders in the takeover target have a chance to see their latent coal assets converted into big bucks - which makes the deal excellent from their point of view.

And all the time the Chinese are humming and harring about finalising their piece of the action. I see this as an excellent rocket for the negotiations. Everyone wants to be with a winner and as it becomes clear that LINC is going full steam ahead with other parties the Chinese will not want to be left behind.

As far as the price of oil goes the geology of oil depletion means we will have severe shortages within a few years. The rate of depletion of current assets and the postponement of other energy projects in teh current environment will hasten this process.

Perhaps one of the more significant shortages will be skilled staff and engineering capacity to build the plants. I suggest the next takeover could be a desperate mining services company - again for scrip !:2twocents
 
Closed at 2.39 i think after some late selling, so not all is lost.

About the oil (and coal, and all raw materials) question - this doesnt affect miners that arent actually producing yet... What matters to Linc is the Oil price when they roll their production barrels of the line... If you think Oil is going to stay sub $40 forever, then i would question why you would invest in LNC...

I.e. Oil price affects Woodside's operational profit (and EPS) today, but LNC SP is reflecting pure potential at the moment... until the sale of the Coal tenements come through and the SP is rated based on cash assets.
 
basilio said:
As far as the price of oil goes the geology of oil depletion means we will have severe shortages within a few years.
Click to expand...

ah yes, defiately heard that before - the best brains and compters in the world (Club of Rome) predicted same in 1978 but here we are, oil trundling back to sub $40 after a manipulated trip to $100 plus.
But maybe, there is only enough oil to last the world another 6 days - maybe.
 
Well Treefrog if Peter Bond and the other directors at LINC didn't believe there would be strong long term demand for diesel at a good price we wouldn't have LINC.
 
Glen48 said:
Makes me happy i sold mine yesterday at 2.35 now I can buy in again at the top and do a repeat.
Still Oil is going down were does this leave LNC?
Click to expand...

Glen48

You did not lose much considering LNC closed at 2.39 today and who knows if it will go south or north tomorrow ?

So a loss of 4 cents compared to today's closing rate you are actually cooking with gas.:)
 
Its not the money I am worried about chase LNC up and down its my sanity and will I last the distance.
 

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