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CBM Asia Development Corp.
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TICKER: TSX.V:TCF, OTCBB:CBMDF
DESCRIPTION: CBM Asia Development Corp. has acquired the rights to exploit
coal bed methane (cbm) in the Kutai Basin in Indonesia. This is a prolific
coal producing region and has recently been opened for cbm exploration. There
is an estimated 80TCF of cbm in the basin. CBM Asia's concession is 2
kilometers from a pipeline and 18 kilometers from the largest LNG facility in
Asia, which is currently running far below its capacity. LNG sells in Asia
for 4 times the NA price because of huge demand from Japan, Korea and China. CBM
Asia intends to deliver this valuable resource to this enormous market. The
company has an area of approximately 83,066 hectares within the Kutai Basin
of East Kalimantan, Indonesia, and is currently mobilizing drills to the
property.
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WEBSITE: http://www.cbmasia.ca
The information below is based on the most recent information we have
received from analysts and the companies participating in The Energy Report. We
encourage you to visit the company's web site for updates.
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TER: Any news on the LNG front in Europe?
MK: I would actually focus on LNG in Asia. LNG isn't going to hit North
America because of the new unconventional discoveries. . .Marc and I agree
that right now the best opportunity for that is in Indonesia with a company
called CBM Asia Development Corp. (TSX.V:TCF) (OTCBB:CBMDF). They're
literally about 30 kilometers from the Bontang LNG plant, the second-largest
LNG plant in the world. Just to tap into that costs a fraction of what it
takes to build a plant. And this company, CBM Asia, has multi-TCF potential. With multi-TCF
potential, this stock has literally 5- to 10-bag potential upon drilling.
MB: Another thing worthwhile to note here is that the gas price they're going
to see will be much greater than anything we're going to see in North America
in the next four or five years for sure.
MK: That's because they're right in an area of demand, which is Asia. This is
my biggest thumbs up in the LNG sector, without a doubt. And I love CBM
Asia's ticker symbol, TCF. The stars have aligned for this company. If anyone
wonders what TCF stands for, it's trillion cubic feet and that's hitting the
equivalent to a 10-million-ounce gold deposit. . .There is production
adjacent to CBM Asia's block. There's no project as well-situated with such a
tight market cap. They're cashed up, a good management team, excellent
projects, great people. And in the junior market, it's also about share
structure. Theirs is as clean as a whistle.
TER: Do we want to move around the world with other LNG opportunities? Or do
we stop in Asia because the biggest opportunity for LNG is there?
MK: I think you want to end it there because of the costs. For example,
there's a great project in Papua, New Guinea. Fantastic geology, great
people, great project, but what's missing? A plant. In today's dollars in a
depressed market, a plant there would cost in excess of $10 billion. Why do I
want to go there when I've got CBM Asia, a junior, trading just above cash?
I'd rather go with a plant that's 30 kilometers away. It's a no-brainer. I
wouldn't even direct your readers anywhere else. They can just stop right
there. That's all they need.
- The Energy Report Interview with Marin Katusa & Dr. Marc Bustin
(06/11/09)
TGR: A few weeks ago you wrote that now is the time to buy CBM Asia.
BM: I was in Indonesia, where they have a big coal basin that they'll be drilling
in a month or two for coal bed methane. Investing is quite simple. You have
to be a contrarian. . .We know peak oil is real and that we need energy even
if we're in a massive depression. We know we need food and food is an analog
of energy. They're drilling in Indonesia and will know a month from now where
they stand. That's exactly the time you want to invest.
TGR: So from a macro overview on energy, this is a specific play, buying it
out of cycle before they have drill results.
BM: Correct.
- The Energy Report Interview with Bob Moriarty (05/20/09)
"CBM Asia Development Corp. is a Canadian-based company focusing on the
exploration and development of coal bed methane (CBM) in Indonesia. The
energy industry in Indonesia is well-established both domestically and
internationally, with good infrastructure. The country is one of the most
important natural gas exporters in the world. New legislation has opened 450
Tcf of CBM opportunity in the country's immense coal reserves, whereby the
government currently takes 55% interest in CBM projects, as compared to up to
70% interest in conventional oil and gas projects.
We believe the company's current projects represent good upside potential for
coal bed methane in light of the large coal deposits in its project area. CBM
Asia's primary objective to delineate a 3P reserve for its Kutai West block
in 2009 through its pilot drilling program, we believe, is essential to
confirm and increase the company's value. Based on our review of the
company's projects and valuation model, we initiate coverage of CBM Asia
Development Corp. with a BUY rating and fair value estimate of $0.58 per
share."
-SIDDHARTH RAJEEV, FUNDAMENTAL RESEARCH CORP. (03/18/09)
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