. Resource value

International Gold Field (IGC) is a mineral exploration and development company. During the year 2007, the Company began divesting from its Western Australian gold interests and commenced earning a right into the Genorah Platinum farms in South Africa.

Background

Investment Summary
INTERNATIONAL GOLDFIELDS LIMITED.. (IGC) has been on our radar for some time now, and we believe the time is now right to recommend the stock as a ‘spec buy’.

• Initial Resource for Genorah Project   Click here

White Energy’s BCB technology allows low quality or ‘sub bituminous’ coals to be upgraded to a higher quality product known as ‘bituminous’ coal. Higher quality coals contain more energy, which attracts a higher sales price, and contain less moisture, making them lighter and less costly to transport. Transportation is one of the biggest cost drivers in coal mining. In addition to these financial incentives, White Energy’s technology has environmental benefits, as the upgraded coal gives off fewer emissions when burned and carries less dust and ash compared to both unprocessed high and low quality coals. Of the four JV’s currently established, that with Indonesia’s 8th largest coal miner, Bayan Resources Group, to operate the Tabang coal mine in East Kalimantan is the most advanced. The structure of this JV provides clues as to how others could be established. White Energy has a 51% interest in the Bayan JV, and funds its share of the capital costs associated with plant construction in return for a proportional share in profits generated by the mine. In addition White Energy receives a 9% royalty payment on all sales. After taking capital costs into account this structure could provide White Energy with a 15% profit margin on sales of upgraded coal.

Background
White Energy is the exclusive worldwide license holder of the Binderless Coal Briquetting (BCB) process that upgrades relatively poor, high moisture coals and significantly increases their energy efficiency. The technology was developed by the CSIRO throughout the 1990’s. White Energy is in the process of commercialising its technology and is currently constructing a major commercial plant in Indonesia. In addition to its Indonesian focus, it is actively pursuing opportunities to deploy its technology across various markets including China, India, South Africa and North America.

Investment Summary
White Energy has been on our radar for some time now, and we believe the time is now right to recommend the stock as a ‘spec buy’. The stock has made a bullish break from a long consolidation phase and we anticipate that completion of the feasibility process in regard to its US JV, and the commissioning of its local small scale production plant at Cessnock, both targeted for June, will be key catalysts in driving the stock higher in the near term as investors realise the company’s future earnings potential. The absence of any current or near term earnings is a key risk facing the stock, as the company’s market cap is a hefty $660m on a fully diluted basis, which suggests that negative feedback from current feasibility studies could have a severe impact on the share price. However with the company supported by the likes of BHP Billiton, we are comfortable with the risks involved. The key to White Energy’s future growth hinges on the successful commissioning and rollout of its initial plants, after which increasing capacity, additional plant construction, and establishing more JV’s will become the focus. With over 30Mtpa worth of demand in the pipeline, the company’s earnings potential will be very strong should premium coal prices remain strong.

Cue Energy Resources aims to drive share holder value by developing its established and geographically diversified hydrocarbon inventory towards production. After years of exploration and appraisal, its total proven and probable (2P) oil reserves now stand at 3.49million barrels, while 2P gas reserves stand at 365billion cubic feet (bcf). Cue already receives revenues from its minority share in the SE Gobe oil field in PNG. However the company’s growth prospects hinge on the development of its other oil and gas assets, particularly the Oyong in Indonesia and the Maari Oil Field in New Zealand. Oil production at Oyong has already commenced, while first oil is expected at Maari in Q308. On going development of projects and the onset of additional revenues are expected to be key share price drivers during the year ahead.

Background
Cue Energy Resources (CUE) is an emerging oil and gas producer with a focus on Australia, New Zealand, and South East Asia. Cue intends to grow its value in excess of $500m by developing a range of exploration and near term production assets. Given the company’s relatively large market cap, production setbacks or lower than expected flow rates are key risks facing the stock, along with oil and gas prices. However the company’s very large undeveloped gas reserves should provide valuation support over the longer term.

Investment Summary
The commencement of first oil production from the Oyong field in Indonesia in September last year timed well with the oil price surging to record highs. The next phase of development at Oyong will involve extraction of its gas reserves which stand at 80-103bcf. First production at a rate of 60m cubic feet per day is targeted for Q309. Boosting the potential for gas production at Oyong, was a nearby discovery known as Wortel. Wortel’s close proximity to Oyong allows the possibility of developing Wortel gas through Oyong facilities, with Wortel gas potentially coming on stream at the same time as Oyong gas. Cue’s other key development is its 5% interest in the Maari oil field in NZ, which is due to commence production in Q308 with full production by early 2009. In addition to Maari, the Wortel and Oyong gas fields will attract much of the market’s focus over the year ahead. However from a longer term perspective, we are encouraged by the fact that Cue’s estimated gas reserves at Wortel and Oyong form only 6.6% of the company’s overall estimated gas portfolio.