Brookfield Reports Progress on DBCT Regulatory Proceeding

Reproduction
Thu, Mar 25, 2010

Coal Company News
Post by Mike Rodger, Coal Reporter

Brookfield Infrastructure Partners L.P. (NYSE: BIP) (TSX: BIP.UN) announced progress in its regulatory proceeding for the Dalrymple Bay Coal Terminal in Australia with the Queensland Competition Authority (QCA), the regulatory agency responsible for overseeing DBCT.

The press release is quoted as saying:

As part of its periodic rate review, DBCT recently filed a revised Draft Access Undertaking (DAU) and associated submissions with the QCA, in accordance with the timetable established by the QCA. The revised DAU and submissions, which have been filed with the full, written support of all of DBCT’s customers, effectively encompasses a roll forward of all the current regulatory revenue building block parameters, including maintenance of the equity beta at 1.0 and updates of other parameters of DBCT’s weighted average cost of capital to current market prices such as the risk free rate and cost of debt. The revised DAU has also been amended to encompass system master planning principles which are designed to promote alignment and efficiency across the broader coal supply chain.

Click here to access the entire press release

Click here to access Brookfield Infrastructure Corporate Site

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M. Montgomery

In my statement that batteries will “provide a much needed new market,” It means that manganese is tied in to the steel market, just as with many base metals used in alloys, like molybdenum. Therefore the manganese market is dependent and price is tied to the whims of the steel market almost entirely.

Diversification is a good thing, by increasing market size, and demand, the rising price of manganese should lead to inflows of investments in mining companies such as American Manganese and others, increasing supply to meet the new demand. At least according to economic fundamentals. These projects do take time to catch up and reach homeostasis.

For example, as China’s economy slows, and steel demand for large infrastructure projects decrease, manganese will decrease as well. However, if manganese takes off as a battery material in consumer good that will still be in high demand regardless of large infrastructure projects, the demand for manganese will remain high, therefore mitigating the impact of slowing steel production.

Does this help clarify?

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