Australian (ASX) Stock Market Forum

LNC - Linc Energy

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Long time reader, first time poster.
A year ago I took the plunge and dived head first into the Share Market. Playing it safe as one does, my portfolio was loaded with quality blue chips, however the gambler in me wasn't going to let me get away without adding a speculative share. A short piece in the financial review sold me on the merits of a new energy source and Linc was added to the fold.
I stumbled on this forum and have perused it almost daily. Whenever my confidence was failing me I could read the quality posts about the future of Linc, which was most helpful. Thanks to the likes of Basilo, dogeatdog, Jonathan111 and Mickel for your wise insights and obvious knowledge of the company.
It appears that exciting times are indeed on the horizon for Linc and I for one am more than happy that it is part of my portfolio.
My one question would be, has the boat sailed yet, or is the current price still cheap enough to add to holdings. I ask this as a still inexperienced investor (apology if asking for trading advice is frowned upon).
 
No advice is allowed to be given to members of this forum as noone is registered legally as a financial adviser (except the few who actually are, but that's their day job, why they'd bother to do it in their spare time as well would be beyond me).

Anyway imo it's not too late to load up on a few more LNC (purely opinion of course, go to blog and read my "legal stuff" tab if you want the full spiel). LNC is very much a stock for the future, their technology hasn't really been applied yet (once it has been, the margins on this stuff will be brilliant), and they haven't really gotten that established revenue/cashflow wise, beyond the coal sale.

However the company is in the process of changing that, and imo that's what will cause the rerating, there are almost limitless projects in which LNC can participate and make money with their rather unique technologies, and I for one would rather be in it at todays prices than out of it (the 'real' question you're asking).
 
I think ParleVou overviewed LNC potentials very succinctly. It's also worth pointing out

1) LNC has around $400m in the bank with probably another $500m due from the next coal sale in 3-6 months. It won't be going broke.

2) Their leases and ownership of underground coal prospects will be worth many, many billions of dollars if/when they start turning underground coal into diesel or CO2 free power stations

3) The EOR operation (Enhanced Oil Recovery) where they simply turn the underground coal into gas and then force this into current oil fields to produce more oil seems likely to be an instant early winner. This hasn't been factored into the equation yet.

4) The direct and indirect investment in AFC (Alkaline Fuel Cell) is another blue sky opportunity. If AFC get going then LNCs 10% stake will be very valuable. And of course if the fuel cell technology proves effective LNC has the exclusive rights, technology and resources to exploit it around Australia and around the world.

So is it still undervalued ? Just maybe a little....;) IMO

And good luck with the rest of your portfolio
 
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I know I'm not exactly the expert on Linc and I must say that coverage here has been excellent and informed and balanced, but there is just so much exuberance that I thought I might play the devils advocate.

How much exuberance is priced into Linc ? They have SO much new tech promise and real company beating prospects (backed up by real assets I know) that they are quite possibly going to have misfires along the way, potentially major.
I think it is worth asking the question in regards to how much impact a major new unseen hurdle will have on this stock's fantastic ascent. There are very few stocks which run this well, and seemingly from strength to strength. It is great, and I hold Linc and have certainly always felt that management just seem to have the Midas touch this year, but when some jitters come, it could correct fairly painfully. LNC have good underpinning, but with the gains people have on their books, they may be quite happy to then sit aside and watch and wait for a re-entry signal.

I only bought in before the coal asset sale so have not been through the ringer like long term holders probably have and perhaps this is why it seems a little too good, but I just wanted to bring this to the table for a quick reflection.

perhaps this is the way a new Exxon is born.

Before anyone gets defensive, please understand that I am as enthusiastic about the future of this stock as anyone, but to trade effectively you must always remain detached from the excitement and pessimism that can pervade when you look at the percentage gain column every day and feel that surge of smugness.
 
Having held and traded LNC for a few years, the impetus for a massive re-rating will be a steady process-driven revenue stream imo.

Should any of their technologies yield a major breakthrough, then the big players that dont invest in companies that dont make a profit will want in.

Blue sky will be the limit if they can make it really work.
 
Having held and traded LNC for a few years, the impetus for a massive re-rating will be a steady process-driven revenue stream imo.

Should any of their technologies yield a major breakthrough, then the big players that dont invest in companies that dont make a profit will want in.

Blue sky will be the limit if they can make it really work.
Click to expand...

Sums up the whole deal. And lets remember that at the very worst LNC has already sold one coal asset with around $2b residual value and a couple of other coal deposits that are still appreciating in value and worth at least $600m.
 
mr. jeff said:
PUBLIC SERVICE ANNOUNCEMENT
I know I'm not exactly the expert on Linc and I must say that coverage here has been excellent and informed and balanced, but there is just so much exuberance that I thought I might play the devils advocate.

How much exuberance is priced into Linc ? They have SO much new tech promise and real company beating prospects (backed up by real assets I know) that they are quite possibly going to have misfires along the way, potentially major.
I think it is worth asking the question in regards to how much impact a major new unseen hurdle will have on this stock's fantastic ascent. There are very few stocks which run this well, and seemingly from strength to strength. It is great, and I hold Linc and have certainly always felt that management just seem to have the Midas touch this year, but when some jitters come, it could correct fairly painfully. LNC have good underpinning, but with the gains people have on their books, they may be quite happy to then sit aside and watch and wait for a re-entry signal.

I only bought in before the coal asset sale so have not been through the ringer like long term holders probably have and perhaps this is why it seems a little too good, but I just wanted to bring this to the table for a quick reflection.

perhaps this is the way a new Exxon is born.

Before anyone gets defensive, please understand that I am as enthusiastic about the future of this stock as anyone, but to trade effectively you must always remain detached from the excitement and pessimism that can pervade when you look at the percentage gain column every day and feel that surge of smugness.
Click to expand...

Very good point MR Jeff.
So easy to get carried away, especially with Lincs meteoric sp rise since the Adani deal.
Like you "Kaisersosa" I'm new to investing my own cash, and only got into Linc, and the general investing gig back in June, pushed by a good friend who has been a long term investor in Linc.
Since June, I've followed this thread, and gained valuable insight from those previously mentioned contributers.
MR Z especially seems to have his finger on the correct pulse.
MR Peter Bond inspires confidence, which can be over done at times, as former failed coal sale tenements have proved.
However, like so many others, this company is going places, and worth holding, or adding shares on dips.
$5 a share minimum, soon, or as us cricket loving poms like to say, "OR I'll eat my hat". AIMHO
 
Thanks Kaisersosa,

IMO I would be very unhappy to sell out of Linc now, i think its potential income will be huge, ucg will be cheap to produce..

IMO it looks unlikely to head back below $2, the first coal sale is done, lots of balls rolling now, hopefully there is less stock on the market with long term holders (institutional investors like the North Americans) buying up. Although there has been alot of short selling happening while the price kept rising and rising... The shorters must have been burnt hard or are still holding with huge loss potential..

EOR seems big enough on its own to take Linc higher.. I am eagerly awaiting the announcement of the EOR sites and its tests and start up.. Along with the JV/s.

Does anyone know if there are any old oil fields in the 122000 Alaskan acres? or is PB buying? I remember there was a seller a couple of months ago looking to offload some old oil fields in the area..


With the first ann of the coal sale being a dud, I think PB was mislead by the potential buyer. Now, i think he is quite cautious and awaits due diligence/FIRB approval, and may have already recieved favourable offers for the current sale.


Imo LNC has the potential to go into double digit $, even high double digits.. The amount of growth potential is huge.. UCG, GTL, EOR, AFC, CO2 sequestration, power generation, tenament sales, ...
 
As PB said at the AGM, there are hundreds of depleted oil fields in Alaska. The one he mentioned has 500M barrels that can't be recovered without EOR . . . and he said he might not get all of it, but by God he'll give it a try. At a $50 profit margin per barrel, there's $25B in the ground for us . . . in the one depleted and otherwise worthless oilfield. If EOR alone will be producing 100,000 barrels per day within 5 years, then that's a profit of around
$1.8B . . . justifies a sp of $20 from EOR alone.

He also made it clear that the Teresa coal sale will lead to another dividend . . . another 10c early in the new financial year probably. I'm sure he wants a divvy every year.

I'd like a little more retrace in the sp before Peter does his publicity tour from Brisbane to Perth in the Lincmobile in early January . . . coz you just can't have enough shares in this company. :p:
 
After the close today, 4.10pm there were approx 200,000 share traded at 2c below the 4.00pm $2.88 close price. Making the new close price $2.86 As far as I could tell the day was finished at 4.00pm

'Scuse my ignorance, but what is that about?

Thanks
 
Bondie put out an update on the Galilee coal sale today. It looks as if Adani is in full flight and keen to start knocking up the planned 50-60m tons of coal sales a year from 2014 onwards.

Obviously Peter wants to make sure the market remembers (and factors in) the fact that LNC will collect at least $100 m net a year (indexed to CPI) from that project.

It is self-evident that the royalty agreement Linc Energy has with Adani becomes increasingly more valuable the greater the progress Adani attains, continuing until production of the first tonne of coal from the Carmichael coal mine is delivered in 2014. Mr Peter Bond, Chief Executive Officer said, “With confirmation recently that the Adani Group plans to commence production by 2014 and produce up to 60 million tonnes of coal per annum, I’d like to wish Mr Adani and the Adani Group all the success for the future with the Carmichael Coal tenement.
Click to expand...

http://www.lincenergy.com/data/asxpdf/ASX-LNC-303.pdf

That works out at a minimum of 20c a share net earnings.

________________________________________________-

After the close today, 4.10pm there were approx 200,000 share traded at 2c below the 4.00pm $2.88 close price. Making the new close price $2.86 As far as I could tell the day was finished at 4.00pm

'Scuse my ignorance, but what is that about?
Click to expand...
Teabagger

From 4.00 to 4.15 there is a "mini " share auction. Buyers establish a price they want to buy at while sellers put their sell price. This is the same as the pre open practice which establishes the initial opening price of the share.

At the cut off time the SP is established by finding the point at which the lowest sellers meet the highest buyers. In todays case there were obviously a number of sellers who wanted to get out of LNC at 2c less than the 4pm price and therefore got their wish.
 
Thanks Basilio.

I probably should have asked that question in the general begginer class forum as it would apply to all stocks instesd of taking up Linc forum space!
 
Well LNC is not holding up that well. Closed at $2.74 for the second day running with quite sharp drops in the final 15 minutes of trade. Obviously another buying opportunity....:(

One thing that hasn't surfaced yet and perhaps is a reason for the pullback is news on the Alaskan drill. I think we expected there would be a decent gas find that would represent an immediate income stream. Not a peep so far and it has been a fair time. Anyone have knowledge ?

Cheers
 
basilio said:
Well LNC is not holding up that well. Closed at $2.74 for the second day running with quite sharp drops in the final 15 minutes of trade. Obviously another buying opportunity....:(

One thing that hasn't surfaced yet and perhaps is a reason for the pullback is news on the Alaskan drill. I think we expected there would be a decent gas find that would represent an immediate income stream. Not a peep so far and it has been a fair time. Anyone have knowledge ?

Cheers
Click to expand...

Hey Bas, unable to offer much of an insight, but PB did mention it wasn't likely "to be a gusher".
Wondering if the recent sp decline, due to institutional guys closing positions before the holidays, as well as profit takers???
I would worry about buying in now. Negative news from Alaska would certainly cause a further drop. Tough call! IMHO

Long term share holder :)
 
Chincilla along with almost the rest of Queensland (it seems) is underwater. I wonder what the situation is with the LNC CTG operation centre and drills? I think we should know because it would have a very material impact on progress.:(
 
basilio said:
Chincilla along with almost the rest of Queensland (it seems) is underwater. I wonder what the situation is with the LNC CTG operation centre and drills? I think we should know because it would have a very material impact on progress.:(
Click to expand...

I'm told the Chinchilla operation is not right at the actual town of Chinchilla which is very close to the Condamine river. I'm not entirely sure exactly where it IS but I took todays' sell-off as a chance to pick up some more at 2.56.

I'm of the belief that any interruption to LNCs operations will be tempoary and I'm holding for the long term so not too worried.
 
Good to see a reversal today from the downward trend of the last week.

The LNC Chinchilla site is some distance from the township (8+km) although less "as the crow flies". From memory of my visit in Nov 08 the GTL plant and the Lab which was adjacent, appeared to be on raised ground- it may have been only 4 to 8 feet- from the surrounding ground.The latest is that the river has peaked (for the moment) at Chinchilla, so, if the site isn't flooded now, it won't in the short term.

I've also just noticed an updated Analyst Report on AFC Energy by Allenby Capital.

They value AFC at GBP 2.20.

"Valuation incorporating SCG revenues
Due to the outstanding technological and commercial progress being made by AFC in potential mainstream power generation markets, valuation by DCF (discounted cash flow) can result in astronomical fair values. To keep forecasts, and hence expectations, within the bounds of market acceptability, a set of sweeping conservative assumptions have been made; both within markets that do contribute to the valuation, and as to which markets are included in the valuation at all. Adding heavily discounted potential SCG cash flow into our previous model, and pushing the chlor-alkai and UCG roll-outs back by 1 and 2 years respectively results in a NPV for AFC of £381m and a fair value share price of £2.20. The full rationale behind this valuation is laid out in this section."

Here is the link on LNC website-
http://www.lincenergy.com/data/media_news_articles/LNC-Related_Reports-578.pdf

Very interesting for both AFC and LNC. Check out Exhibit 1 on page 9.
 
Mickel said:
Good to see a reversal today from the downward trend of the last week.

The LNC Chinchilla site is some distance from the township (8+km) although less "as the crow flies". From memory of my visit in Nov 08 the GTL plant and the Lab which was adjacent, appeared to be on raised ground- it may have been only 4 to 8 feet- from the surrounding ground.The latest is that the river has peaked (for the moment) at Chinchilla, so, if the site isn't flooded now, it won't in the short term.
Click to expand...

it looks like only parts of the town were flooded..

A general view of the town of Chinchilla affected by floods in Queensland, Australia

69619344-general-view.jpg




http://www.allvoices.com/contribute...la-affected-by-floods-in-queensland-australia

I emailed Linc mid last week asking about the flood but have not recieved a reply yet.
 

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