Prices heading north even as strikes continue
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PrintPost by Melissa Pistilli, Potash Reporter
By Daniella D’Alimonte – Exclusive to Potash Investing News
The TSX main index made a turn-around from its bearish outlook on September 10. Commodities played a part in this bounce-back after a string of bad sessions.
Potash Corp. of Saskatchewan (POT: TSX) made a 2.2 per cent gain to nearly US$153 per share and is still on the rise.
There are speculations that Potash Corp. could take over Incitec Pivot Ltd., Australia’s largest producer of fertilizer. With the company’s lack of debt in addition to its US$39.8 billion dollar value, six times that of Incitec, Potash Corp. could make the purchase without selling any shares.
Incitec failed to comment on speculations when questioned by Bloomberg.
Norway’s Yara International ASA, Agrium Inc. and Mosaic Co. are also possible contenders to make the purchase. Potash Corp. has announced a private-agreement purchase of 500,000 of its shares for cancellation from a third party seller. The company has now bought 15.15 million of the 15.82 million shares for its previously announced repurchasing program.
One month after strikes began at Potash Corps Allan, Cory and Patience Lake, workers are still standing their ground, demanding a larger cut of the company’s record earnings. The company maintains that its employees are already the highest paid in the industry, thus, refusing to budge.
Workers recently held a barbecue in an effort to boost morale. “We are feeling pretty good. We are prepared to wait. We won’t run out of money — the Steelworkers have a deep strike fund,” said Ron St. Pierre, strike coordinator and a worker at the Allan mine, in an interview with Saskatchewan News Network.
Business is full steam ahead at Athabasca Potash Inc.’s (TSX: API) Canadian Burr Project. A potentially profitable quality of potash was located in four of the wells drilled and the company’s 2008 drilling program has been increase from six to nine holes. In addition, Athabasca has applied for licensing for five more wells. This process is expected to be completed by the end of November.
Shares, which went public at the end of last year, are now trading around US$3.60 per share. Western Potash Corp. (TSX: WPX) has been granted a further exploration permit for 49,000 hectares of land south of its Russell-Miniota property in Manitoba. Seismic data has shown potentially expansive areas of potash deposits, according to the company’s press release. Several wells are being developed to access these deposits.
Potash One has confirmed the initiation of its drilling program at its Legacy Solution Mining Project. Into the first phase at the southern Saskatchewan project, the company has found promising solution mining development areas that have long term potential. This first phase will produce three to five wells while the following phase will produce an additional nine.
Ohio-based Boulby Potash mine could soon play a part in scientific history. An experiment held at CERN (European Organization for Nuclear Research) near Geneva from September 10 attempted to re-create the ‘Big Bang’ theory to better understand gravity and black matter. Over in Cleavland, 3,000 feet under the ground in a small lab beneath Boulby, scientists are also working to pinpoint black matter as well as beat the Swiss project to the punch.
“It is a race in the world astrophysics community to directly observe dark matter – and we would like to be first,” Dr Sean Paling, a Boulby researcher, told the Evening Gazette. Boulby has been considered for this research since the 1990’s, with its depth making it an ideal space. The CERN project could be completed in about two years while the Boulby project could succeed in half the time.
Questions about this article? Leave a comment below or contact our editorial team at editor@resourceinvestingnews.com.
September 15th, 2008 at 1:09 pm
It is painfully obvious that Daniella Dalimonte is very bullish on potash corp stock using her writing skills to prop up this sagging stock.Todays market decline gives us more insight as to where this OVER PRICED STOCK is heading.She claims it is heading north but smart investers know it is heading south to $80 to $90 where it should be.Now is a good time to dump POT and buy back in when PCS gives a fair contract to their employees.The only contract offer that PCS has tryed to force feed its employees will never be accepted because of all the strings attatched with it.One is forced over time.The employees would also like a far better pension plan.With this existing plan I have to work for 41 years to achieve an unreduced pension,41 years underground,that is pathetic and a sad truth.We want a better wage structure,all costs of living are skyrocketing but wage increases dont keep up.PCS throws all kind of THEIR ASSUMED FACTS in their presentations of this so called sweet contract offer including things like averaged over time with their calculations.These figures they continually present are garbage and very misleading from the real truth.I work very little overtime only 12hours so far this year.My family comes first,my kids upbringing is far more important than any extra hours spent working for these individuals.The 3 or 4 top brass at PCS own piles of their stock having given themselves a sweet deal of cheap byback prices.They have recently repurchased more in an effort to controll this slide but you investers are too smart not to see this.SELL OF POT NOW. MB
September 16th, 2008 at 7:25 am
Good Afternoon Daniella
I’ve been reading through your website and finding it particularly insightful,It is fascinating to learn about other investment ideas such as Potash… Great stuff!
I would like to extend to you an invitation of being a founding member of a social network for investors.You would be an asset to members…they would learn about the field of fertilizers……..
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September 16th, 2008 at 8:23 am
Very interesting remarks from “Mark”. Truly words spoken from emotion and despite. Why would an emplyee want to see their company’s stock decline in a general act of vengence towards the hand that feeds him. Potash emplyees are of the highest paid in the industry. There’s plenty of people looking for work in Canada, outside union influence. I highly doubt the steel workers union has a stronger contingency plan for it’s members than Potash has running it’s business. I give the union heads 60 days max before they cave in. The longer they’re on strike, the greater the chance the workers will vote for anything offered just to get back and provide for their families. I am very confident a settlement will be in place by end of November, that is if the union is smarter enough to not risk layoffs for its members.
Enyoy the time off while it’s there. Just remember, union dues thrive on member contributions. As long as there are contributions to be provided. Understand ?