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AVA, AVIVA CORPORATION LIMITED
melanie
post Posted: Jul 25 2007, 06:41 PM
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In reply to: jacsar on Wednesday 25/07/07 12:30am

Interesting to follow this one, Jacsar! Aviva’s argument is that if its North Perth Basin coal deposits were used for power generation, it would free up domestic gas for other industrial users (Annual Report ’06). By mid-2009 to 2011 it is forecast there will be significant domestic gas shortages in WA. So “dirty coal” has been winning out over its cleaner greener gas rival. AVA estimates the magnetite operations at Karara and Mt Gibson together would consume 200 MW of power. Gindalbie Metals (GBG) said in June it was unable to secure a long-term gas supply contract for Karara and was negotiating with proposed coal-fired power generator – that could only be AVA? (Jun 15, thewest.com.au)

AVA could come up with a “clean coal” technology that would have potential to attract a major grant – major stakeholder Wasabi Energy (WAS) has acquired an interesting technology licence to do with greenhouse gas emissions abatement, and other technology to do with power generation. WAS proposes to take over 12.3M shares in AVA that are held by Xtract Plc. Wouldn’t that be fun if dirty old coal gets a green grant! (this is nothing but a thought, but similar happened in Vic recently – “clean coal” grant for a brown coal power station)

AVA can remove its overburden without blasting – cheap to mine the coal. Gas has at least doubled in the past year in WA.

But worth being aware that ENB and AVA are both contenders for base load power in the Mid West. ENB has a gas supply contract in place and has MoU’s with potential customers. And its initial 168 MW capacity can be upgraded to 365 MW in its Stage V development. I have no idea if there can be two “winners” in these stakes.

(posting research info for anyone interested, not intended as investment advice, I no longer hold)

 
jacsar
post Posted: Jul 25 2007, 12:30 AM
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In reply to: melanie on Monday 02/07/07 05:31pm

Great comment melanie.....[ If the infrastructure consortiums in the Mid West can build ports, railways, mines, I’m really interested to see what they will do to service Oakajee, which will need power, water, gas. ]...the key is infrastructure, basic facilities such as ports etc cannot operate without base load power in place..renewables are an add on extra if conditions right but one needs the hard basics in place before them. ..sold my AVA to put towards unit but still follow with great interest...cheers

 
haspete
post Posted: Jul 24 2007, 01:48 PM
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Anyone got the code for the oppies.
Ta Pete.

 
melanie
post Posted: Jul 2 2007, 05:31 PM
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The Geraldton and Mid West region has been identified as a prime area for wind power generation, even now there is capacity that cannot be added into the grid as it is at full capacity. (Both wind farms and fossil fuel proposals are unable to be added into the grid due to shortfall in transmission network, until the upgrade). (from Western Power) I am beginning to understand the meaning of “capacity constraints”!

A coal-fired power station would support the Mid West mining expansion, and AVA targets adding base load power to the grid. AVA targets commissioning in 2011. Wind – renewable, but has disadvantage of being intermittent without back-up storage. Gas – at this point more expensive than coal, and reliant on continuity of supply. (Approvals already granted for gas-fired power station, 168 MW). Aviva’s coal – on site, no transport costs, amenable to open-cut, so reliable source for base load power. AVA targets Q4, 2008 for the approvals process and financing arrangements. Re exporting coal if power plant is not approved, will wait and see. I accept the risk that electricity Generation Licence has not been granted, and that the process will take its time, with “carbon-neutral” targets competing with “industry needs” in an unpredecented “window of opportunity” for the Mid West iron ore industry. I have not seen anything in the public domain to indicate it will be knocked on the head, and development of the North Perth Basin coal deposits is advocated in public-access documents (from Net), as well as gas and wind for power.

Project in Botswana is targeted for financial close and approvals in 2009 – the market demand for power there is really huge compared to W.A., it is unfamiliar territory to me, but adds another string to AVA’s bow. (2000 MW pa demand growth estimated by power utility Eskom, for South Africa).

If the infrastructure consortiums in the Mid West can build ports, railways, mines, I’m really interested to see what they will do to service Oakajee, which will need power, water, gas.

 
crooked
post Posted: Jul 2 2007, 10:43 AM
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In reply to: melanie on Friday 29/06/07 06:10pm

The renewables target will surely have a role to play in the development of the power station. What's your veiw of the company if the power station does not go ahead. There is still a significant resource to be mined and exported??

 
melanie
post Posted: Jun 29 2007, 06:10 PM
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I found the answer to that question in a recent WA Govt. document - 5 Yearly Infrastructure Report Western Australia (April 2007). It is stated: "Some sections of the transmission system can not accommodate any more generation (ie Perth to Geraldton line)". At the same time, it is stated that some 720 MW of power capacity will be removed over 3 yrs due to decommissioning of old plants, (SWIS) and more generation capacity will be required. A target for WA for "renewables" is set at 6% by 2010. Coal is still part of the scenario for power generation in this document. WA is not part of the NEM (National Electricity Market) and must be self-reliant for its power needs.

 


melanie
post Posted: Jun 28 2007, 03:22 PM
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In reply to: crooked on Wednesday 27/06/07 05:42pm

Like you, Crooked, I am keenly watching. The infrastructure side of the Mid West expansion may come more into the spotlight after the big infrastructure deals are bedded down. Re upgrade of the transmission line you mentioned below, (Pinjar-Eneabba)according to Western Power's website, this is due for completion summer 2010/11. But is it required before extra base load power can be added into the Mid West regional system?

 
crooked
post Posted: Jun 27 2007, 05:42 PM
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In reply to: melanie on Wednesday 27/06/07 05:17pm

Thanks for the update Melanie, eagerly looking forward to the progression of this development.

 
melanie
post Posted: Jun 27 2007, 05:17 PM
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Aviva Corp (AVA) has converted “resource” status to JORC-compliant "reserves" status, calculated at 72m tonnes of coal at its Central West Coal project, or sufficient to run a proposed 400 MW power station for 30 years. Aviva is targeting production of base load power to the rapidly expanding Mid West region of W.A.

 
melanie
post Posted: Jun 18 2007, 09:15 PM
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AVA - one of the stocks to watch in relation to development of electricity in the mid west region. No certainty a coal-fired power station will be approved, but I believe the professional team is now there to put a coal-fired power station into production, pending successful feasibility studies. Quantum leap in expansion of mid west region foreshadowed today, with the announcement of MMX and Mitsubishi JV to advance port, railway, mine - all dependent on an expanded supply of electricity. Whoever wins in the provision of power stakes, can be sure the WA govt. will fast-track approvals to take advantage of this "window of opportunity" for development of the mid west region.

 
 


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