PDZ Overview (2/2)11 Feb 2018 18:30
Jan Karski:
PDZ has signed a strategic cooperation agreement with China Coal. China Coal is the second largest coal mining company in China and most prolific company worldwide at constructing new Coking Coal mines. They have constructed more coal mines in the last decade than the rest of the world put together (PDZ CEO previously worked with China Coal for 5 years as their overseas investment banker).
China Coal are completing a Bankable Feasibility Study (BFS) for Jan Karski following which a construction contract to build the mine in return they have to bring PDZ a Chinese Bank Financing Package. PDZ have already got and agreed provisional favourable terms with Chinese bank.
In country experience � immediately next door to Bogdanka mine which has been operating successfully for over 30 years. PDZ have now appointed the former CEO of this mine as their top executive in Poland. Bogdanka is the lowest cost most profitable coal miner in Europe today, market cap of around $1billion.
Newsflow:
- BFS is due this month.
- Environmental permit submitted end of 2017 and granting news expected Q1 2018.
- Offtake agreements Q1-Q2 2018.
- Project financing package with China Coal & China Bank Q1-Q2 2018.
- Mine Construction Q3-Q4 2018.
Debiensko:
Former operating mine back 1980s
All infrastructure in place, railway, electrification, office buildings, mine shafts etc.
Fully Permitted. Environmental Permit already in place
Immediately adjacent to two JSW coal mines that are currently operating today & are hugely profitable. These mines however are nearing the later stages of their mine life. This means that JSW are on the look out for new coking coal assets that they can develop new rather than spending increasing amounts on keeping old mines going. This leads nicely on to PDZ�.
JSW have now confirmed that discussions are taking place with PDZ to acquire the Debiensko licence from PDZ or have a stake in the development of the project. JSW current market cap is $2.2billion and announced last week that they are looking to raise $400-$500m to capitalise on such opportunities.
Not really hard to join the dots here, PDZ have the mine and all the rights over the mine that JSW want. PDZ are in a position of strength to negotiate a good deal for shareholders which looks to have currently flown completely under the radar by the market.
The next newsflow on this front will be very interesting, and potentially incredibly rewarding for PDZ shareholders. Although negotiations are early stage it may well be that JSW just put a takeover offer in for PDZ outright.
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