Referendum on Asset Sales

[Oscar]

So has coal production stopped worldwide? I mean if its not cost effective to dig up coal then the world then no one must be digging up. Why would they - through your vast intellect you have shown us that cost is a -30% industry.

Hooray the world will have to stop using coal because it costs too much to get out of the ground. The world is saved.

Or your wrong? Just a thought.

(I do know more here - but I will let you react barbarically and defensively as to why you are not wrong. But I will give you a hint - Solid Energy failed due to expenditure......not getting coal out of the ground and selling if for profit).

Or it could be that the demand for coal (and subsequently the price) reduced after the GFC.

[husaberg]

The value of those mineral licences is only the value of the minerals removed, minus the cost of doing so ...

With a 40% drop in coal prices worldwide that value has gone ...

Given that roughly 70% of the price of any product is the cost of it's production, that leaves 30% for taxes, profits ... but a 40% drop in price cuts out al of that 30% taxes and profits and cuts into the cost of prouction ... i.e. it will cost more to mine than the product will sell for ..

Solid Eergy on that basis is a worthless company ...



Great ..

So has coal production stopped worldwide? I mean if its not cost effective to dig up coal then the world then no one must be digging up. Why would they - through your vast intellect you have shown us that cost is a -30% industry.

Hooray the world will have to stop using coal because it costs too much to get out of the ground. The world is saved.

Or your wrong? Just a thought.

(I do know more here - but I will let you react barbarically and defensively as to why you are not wrong. But I will give you a hint - Solid Energy failed due to expenditure......not getting coal out of the ground and selling if for profit).

Its not just the Coal most of the Coal fields are not fully explored the reserves Solid Energy hold are vastly underestimated and it is mostly high quality.
Coal will swing up again, The time to buy is when its low. tieing up the NZ reserves also increases the price (supply and demand.)
Any buyer does not have to behave the same as the SOE did either.
The prospects for recovering the coal seam gas and for underground coal gasification the are huge.
Also all the plant for Solid energy is in place most of it very new.
That's not not even including the peat and lignite for Nitrogen fertiliser and synthetic fuel. Thermal electric power anyone.

[mashman]

Its not just the Coal most of the Coal fields are not fully explored the reserves Solid Energy hold are vastly underestimated and it is mostly high quality.
Coal will swing up again, The time to buy is when its low. tieing up the NZ reserves also increases the price (supply and demand.)
Any buyer does not have to behave the same as the SOE did either.
The prospects for recovering the coal seam gas and for underground coal gasification the are huge.
Also all the plant for Solid energy is in place most of it very new.
That's not not even including the peat and lignite for Nitrogen fertiliser and synthetic fuel. Thermal electric power anyone.

9 May 2007

Solid Energy has expanded its bioenergy business with the acquisition of biodiesel producer, Canterbury Biodiesel, and plans to increase annual production to 70 million litres within three years which will meet more than half the Government's 2012 target for biofuels.

So they were going into biofuels for a reason i.e. legislation.

However

"In 2009 the National Government repealed the biofuel legislation and the obligation for all companies to sell a percentage of biofuels. We repealed the Act in the face of the sustainability issues, and because we believed it would force up the price of fuel for consumers. Existing biofuel production continued, but it was from local feedstock and mostly waste products such as used cooking oil and tallow."

Someone got their wires crossed.

[pete376403]

I assume (dangerous word) that the major uses of coal are electricity generation and steel making. While there are alternative methods of electricity generation - hydro, solar, wind, even nukes, is there a practical alternative to using coal for steel making? If not, then surely the demand for coal must at some time rise again.

[Zedder]

9 May 2007

Solid Energy has expanded its bioenergy business with the acquisition of biodiesel producer, Canterbury Biodiesel, and plans to increase annual production to 70 million litres within three years which will meet more than half the Government's 2012 target for biofuels.

So they were going into biofuels for a reason i.e. legislation.

However

"In 2009 the National Government repealed the biofuel legislation and the obligation for all companies to sell a percentage of biofuels. We repealed the Act in the face of the sustainability issues, and because we believed it would force up the price of fuel for consumers. Existing biofuel production continued, but it was from local feedstock and mostly waste products such as used cooking oil and tallow."

Someone got their wires crossed.

Yep, not only that though, Don Elder the Solid Energy CEO lead the high risk expansion strategy in 2006 based on a far too optimistic view regarding oil and coal prices with no supporting information. According to Treasury documents released under the Official Information Act, however, it took 5 years for the truth to come out.

Oddly enough, Elder was still being paid his NZ$1.3 million salary up until August this year.

[mashman]

Yep, not only that though, Don Elder the Solid Energy CEO lead the high risk expansion strategy in 2006 based on a far too optimistic view regarding oil and coal prices with no supporting information. According to Treasury documents released under the Official Information Act, however, it took 5 years for the truth to come out.

Oddly enough, Elder was still being paid his NZ$1.3 million salary up until August this year.

Given the legislation and political direction of the day it probably seemed like a good idea at the time.

Lucky fucka.

[Zedder]

Given the legislation and political direction of the day it probably seemed like a good idea at the time.

Lucky fucka.

No actually, he was a maverick. He also bought up large amounts of land and mineral rights in Southland without consultation or authorisation.

How many beers?

[mashman]

No actually, he was a maverick. He also bought up large amounts of land and mineral rights in Southland without consultation or authorisation.

How many beers?

Lucky fucka.

[Zedder]

Lucky fucka.

I'd say 4.

[mashman]

I'd say 4.

Why not...

[husaberg]

Gee guys really CEO's are not the people who actually Run SOE's.
http://fmacskasy.wordpress.com/2013/...d-fall-guys-2/
http://www.scoop.co.nz/stories/PA130...y-for-cash.htm
http://fmacskasy.wordpress.com/tag/solid-energy/
http://norightturn.blogspot.co.nz/20...rgy-files.html
http://www.nzherald.co.nz/nz/news/ar...ectid=10871331
http://www.nzherald.co.nz/nz/news/ar...ectid=10871040
http://www.parliament.nz/en-nz/pb/bu...and-assistance
http://www.parliament.nz/en-nz/pb/bu...ncial-position
http://nzfirst.org.nz/news/solid-ene...nks-government
http://www.treasury.govt.nz/publicat...es/solidenergy
http://www.sourcewatch.org/index.php/Solid_Energy
http://new.rankinfile.co.nz/nrf20130...Management.pdf

[avgas]

Or it could be that the demand for coal (and subsequently the price) reduced after the GFC.

Actually the opposite happened - because China (the LARGEST BY A FACTOR OF 2 - Consumer) could buy more for less.

[avgas]

I assume (dangerous word) that the major uses of coal are electricity generation and steel making. While there are alternative methods of electricity generation - hydro, solar, wind, even nukes, is there a practical alternative to using coal for steel making? If not, then surely the demand for coal must at some time rise again.

Perhaps I didn't highlight the blatant lies before......Coal usage did not, I repeat, DID NOT drop.
People assume that because the US, NZ, UK and Aus slowed their use of coal that it dropped.

Here is a consumption graph:


and attached is the graph that shows China's consumption....


So if the price went down 40% all we had to do was sit on a reserve until china ran out and we could charge anything we wanted for it. Therefore Solid Energy is far from useless.

[MisterD]

So if the price went down 40% all we had to do was sit on a reserve until china ran out and we could charge anything we wanted for it. Therefore Solid Energy is far from useless.

Which is all well and good, unless you've borrowed a shit load of money and need to service the debt. *That* is SE's problem, they weren't able to service their borrowings, so the Government had two options 1) gouge the taxpayer to pay down the debt or 2) restructure and force the lenders to take a haircut or lose everything if SE went into liquidation.

It's because SE is still a long term viable proposition that restructuring was a possible.

[husaberg]

Which is all well and good, unless you've borrowed a shit load of money and need to service the debt. *That* is SE's problem, they weren't able to service their borrowings, so the Government had two options 1) gouge the taxpayer to pay down the debt or 2) restructure and force the lenders to take a haircut or lose everything if SE went into liquidation.

It's because SE is still a long term viable proposition that restructuring was a possible.

Mr D the bit you are missing is the Government Gouged Solid Energy, follow the links i posted if you don't believe me.
They were the ones that told them to Borrow so heavily and they are the ones that told them to borrow to pay the dividends They also as a legacy of the Koyoto gave the government an extra 125 million or so in Carbon taxes, Ask yourself where did that money go