Epic : CDN

Web Site : http://www.caledonresources.com

Broker Note 1st Aug 2007 : http://www.caledonresources.com/Images/FileManager/192.pdf


About Caledon: Caledon is quoted on the London AIM market (Ticker: CDN). In 2006, the Company acquired two Australian coal projects; the Cook mine and the Minyango coal project, both situated in the Bowen Basin, Queensland. The Cook mine is host to a mineable reserve of 17 Mt of coking and thermal coal with a 10 year mine plan. On 21 March 2007, Caledon announced commencement of production at the Cook mine with targeted output to reach a 100,000 tonnes per month rate by the end of 2007 and 1.5 million tonnes per annum in 2008. On 14 March 2007, the neighbouring Minyango project resource was brought to a JORC standard of 240 million tonnes which was an increase of 17% on original estimates. Caledons aim is to develop the Minyango project to potentially increase the Companys production in the near-term to accompany its already producing Cook mine project.

**********************************

Caledon Resources PLC Interview With:
Mark Trevan Managing Director

Dated September 20, 2007

http://www.wallstreetreporter.com/page.php?page=featured&id=26736

Demand for Coal and for Coke appears to be very strong presently.


http://www.busrep.co.za/index.php?fArticleId=5021098

Coal prices soar to record over $100
September 27, 2007

By Jackie Cowhig

London - Physical coal prices for delivery into Europe broke record levels over $100 a ton on Thursday, as the worldwide rally in energy prices broke through into the opaque and fragmented coal market.

Coal prices have been rising all year as availability has progressively tightened. Unfortunately for consumers, freight rates have also repeatedly hit record levels, forcing up the delivered cost of coal.

Three Q4 delivery coal cargoes traded on Thursday, one at $102.00 a ton DES ARA and one at $101.00 DES ARA on the globalCOAL trading platform. A further parcel was sold at $101.00 through brokers, traders said.

These were the first visible, on-screen coal trades ever at over $100.00 a ton. In January, CIF/DES ARA coal prices were around $65.00 a ton.

Prices of prompt loading South African coal cargoes bounced back above $65.00 a ton free-on-board (FOB) Richards Bay on Thursday, having drifted down to around $63.85 for an October cargo on Wednesday.

A flurry of four trades within minutes of each other on electronic trading platform globalCOAL saw prices rise to the highest traded level on Thursday of $65.50 a ton for a December loading panamax.

Two November loading panamaxes traded at $65.00 and $65.25 a ton and two December panamaxes at $65.50 and $65.30.

There were several companies involved in the trades including banks, traders and a major European utility/trader.

The buyers were covering short positions for Q4, one of the companies involved said.

South African availability for Q4 and Q1 is tight and getting tighter, traders and utilities said.

Prices for prompt cargoes could rise to $70.00 or more within weeks if Indian buyers return to the market as expected for two million tonnes for Q4 shipment, traders said.

Coking coal prices set for a boom ahead ?

The key line, as far as CDN is concerned, is "and with a rebound in prices for thermal and coking coal likely,"


http://www.dailyreckoning.com.au/australian-dollar-6/2007/09/27/

Strong Australian Dollar Sign of Strong Economy

Posted by Dan Denning on Sep 27th, 2007

The Aussie dollar once again moved up against the greenback, nearing 87 cents. The strength of a currency is often a referendum on the strength of an economy. Australias economy has some notable weaknesses, namely the trade deficit and the high level of household debt as a percentage of GDP (see yesterdays letter). But it also has some obvious strengths which make it appealing to investors.

The Australian Bureau of Agricultural and Resource Economicswhich has the clumsiest name of any government agency weve ever encounteredannounced earlier this week that Australian commodity exports should generate nearly US$144 billion in sales in 2007 and 2008. The stronger Aussie dollar actually lowers the sales figures a bit. Commodity sales priced in US dollars are then converted back into the Aussie. With a falling greenback, Aussie export earnings take a hit.

So far, however, high commodity pricesespecially for nickel and copperhave kept export sales growing. With BHP (ASX:BHP) and Rio Tinto (ASX:RIO) negotiating a hefty increase in the iron price for next year, and with a rebound in prices for thermal and coking coal likely, the Australia-China parternship looks as strong as ever. Not just boom. Sonic boom!

I didn't realise that TW had a 70p base valuation target on CDN but with Minyango offering lots of upside to that 70p.

Jolly good.

Update from GE&CR today :

...........On September 3rd, Caledon Resources announced that it had made its first sale of coking coal with the shipment of 14,000 tonnes in August 2007. Due to a change in vessel arrival dates, this first sale of coking coal was below the forecast indicated in the Companys AGM statement announced on 31 July 2007. Forecast sales of coking coal for September are in excess of 60,000 tonnes.

On September 11th, the company announced its interim results. These showed that it had made a pre-tax loss of 5.73 million in the half calendar year, resulting in a loss per share of 3.91p. The losses reflect the cost of the companys successful completion of the Cook mines refurbishment and re-commissioning. With output from the Cook mine now increasing sharply, a process accelerated by the introduction of the Magatar Mining System in October, it is likely that production will reach levels of 100,000 tonnes per month by the end of the year.

Our current valuation of the Cook Mine alone is 71p. We expect drilling results from the Minyango lease to be published shortly - they are currently held up by the analytical lab in Australia. Our valuation of the Minyango lease is at 3.6p per Caledon share. With an estimated cash at bank figure of 1 million our estimate of fair value is 76.45p per Caledon share. At 36p our stance remains buy.

http://www.marketwatch.com/news/story/bhp-billiton-says-coking-coal/story.aspx?guid=%7BEE4BD93C-868A-4745-8CCF-64DDC0A2AFFD%7D

BHP Billiton says coking coal demand very strong

By Alex Wilson
Last Update: 5:30 AM ET Oct 2, 2007

MELBOURNE (MarketWatch) -- BHP Billiton Ltd. (BHP.AU) said Tuesday that the coking coal market remains very strong.
BHP's marketing director for carbon steel materials, Peter Toth, said infrastructure constraints continue to limit supply and that demand from traditional customers remains strong, while China and India continue to grow.
"The underlying fundamentals of the coking coal market are very strong, and it's the strongest that we have seen for some time" he told analysts.

http://www.investegate.co.uk/Article.aspx?id=200710040701401149F

October 4 2007
Caledon Resources Plc

Caledon Resources plc ('Caledon' or 'the Company'; AIM: CDN) is delighted to announce a substantial uplift of both Resources and Reserves at its Cook Coking Coal Mine

39% increase in Cook mine Resources to 176 million tonnes in the Measured and Indicated categories

Cook mine Reserve has increased by 38% to 23.6 million tonnes

Group total JORC compliant resources have more than trebled to 416 million tonnes since readmission in 2006

Final coking coal sales figure for September amounted to 70,000+ tonnes.

Caledon is delighted to announce a substantial uplift of both Resources and Reserves at its Cook operations following an extensive study by independent consulting group, SRK. The previously stated Cook Mine Resource was 126.5 million tonnes. Further drilling has confirmed a 39% increase in Resources to 176 million tonnes in the Measured and Indicated categories. A detailed mid-term mine plan study has also substantially increased the mines Reserve. The Cook mine Reserve has increased by 38% to 23.6 million tonnes. Both Resource and Reserve statements are to the JORC standard.

The Company also takes this opportunity to update the information regarding September sales of coking coal from its 100% owned Cook mine. Final sales for the month of September 2007 totalled in excess of 70,000 tonnes. The coal was sold under existing marketing agreements at a price in line with industry expectations.

Chief Operating Officer Peter Seear said 'This latest study by independent consultants has added a further four years of mining to our mid-term mine plans, with substantial further upgrades to come in future years as drilling continues.
Caledon has taken the unusual step of planning its long term mine design and has now developed the mine plan out to 2020 with substantial additional expansion to come. In the short term we continue to focus on the implementation of the Magatar mining system as soon as possible.'

Mark Trevan Managing Director of Caledon Coal added 'Caledon now have JORC Resources of 416 million tonnes at its Minyango and Cook properties with substantially more expected to be defined as drilling continues. This is further evidence of the commitment that Caledon has made to develop these world class coking coal properties. Since Readmission on 14 December 2006, the Company's total JORC compliant resources have more than trebled to 416 million tonnes.'

Excellent!

This looks like a pump and dump exercise if ever I saw one.
Stay well clear I say!!!!

Moving up again.

Yep, well, the new system is being implemented this month, so we should get an update some time of success in doing this, and of course, once its in, then increased coal production.

You cannot be serious.
In these days of green fuel what chance has a coal mine these days?

Caledon jumps on resource upgrade
Thursday, October 4, 2007, 09:05 AM
Caledon Resources (AIM: CDN) received a boost to its share price this morning after announcing a substantial increase in the resources and reserves at its Cook Coking Coal Mine in Australia. Caledon said that the measured and indicated resource had increased by 39% to 176 million tonnes and the coal reserve had increased by 38% to 23.6 million tonnes. The brought the total JORC compliant resource to 416 million tonnes, more than treble the estimate when Caledon was readmitted after completing the acquisition of Cook from Xstrata Australia. Caledon also added that in September is sold 70,000 tonnes of coal.

Mark Trevan, Managing Director said "Caledon now have JORC
Resources of 416 million tonnes at its Minyango and Cook properties with substantially more expected to be defined as drilling continues. This is further evidence of the commitment that Caledon has made to develop these world class coking coal properties. Since Readmission on 14 December 2006, the Company's total JORC compliant resources have more than trebled to 416 million tonnes."

Shares in Caledon jumped 12% to 38 pence on the positive news.

I still think these will head south when the dust settles.

transco, you are entitled to your opinion, I presume you have no interest in this company!, so whats your point??

My point it is dangerous to invest in companies like Caledon where web sites like these can pump up a share price and bring about short term spikes only to see it come to nothing later.
This is a pump and dump stock take my word for it.

Punteres beware!!!!!!!
imho sorry goal just my view - time will tell

Errrr pump and dump stocks tend to be smal illiquid shares with no current real business. Certain people buy into them, and then ramp them like mad, and with the stock being illiquid, the SP will suddenly jump massively to which they sell out. A pump and dump cycle is a couple of weeks, no more.

However, Caledon has a business plan, it has an ongoing business, its now producing and selling coking coal, and if their expansion plans come out fine, then in a short period of time the production output will make the present market cap look undervalued imv.

PP i agree with you on the business plan, they are believe to be testing the new equipment at present, which should push up tonnage quite considerably. And of
course theirs a question of reserves which have been increased of late to the Cook
Project and we await drilling results form Minyango, which could be a real ice topping?
cyril

Papal,

Sorry old boy but all aim stocks are as you describe small illiquid thats why they are there.
Caledon is a perfect example of a pump and dump exercise.
If the new reserves were as they say why does the SP not reflect it?
Reason - Australia is floating on coal (100 years of reserves) so its hardly surprising they have found more - on the other hand its a dying fuel and has no long term future.

Sorry but investors stay clear - if im wrong I will eat my hat.

IMHO

transco,
CDN are producing Coking Coal for which their is a world shortage along with a growing demand and will be in the growing future.
How would you like your hat seasoned?
cyril

Exactly cyril, the demand for coking coal is far outstripping supply.