Ann: Altona Welcomes MMG's Endorsement of Dug, page-7

re: Ann: Altona Welcomes MMG's Endorsemen... The other significant news out today is from Origin who have just announced a major gas supply agreement with MMG for Dugald.

This solves Roseby's gas supply question since Dugald is only 9km away and a pipeline will need to be built to it.

I know you guys are critical of AOH trumping this announcement but I think your criticism is borne of frustration. If you look at it for what it is, this is actually a crafty move on AC's part IMO, for two reasons.

First, it's a strategic and very timely announcement directed at Xstrata. It's reminding them that AOH doesn't need Xstrata at a time when Xstrata need to make a decision. Just in case Xstrata were thinking of low-balling the independent valuation to try and force AOH's hand.

Second, it's a reassuring announcement to the market in general that if Xstrata don't take the option, things arguably look better for AOH than if they do, because MMG are now confirmed as going ahead with a much bigger project, and the potential synergies with Roseby will benefit MMG as well as AOH.

This is MASSIVE news for AOH because all the infrastructure for Little Eva is now going in independent of Xstrata. AOH could never have been able to put this infrastructure in by themselves. Gas, power and rail all going in. Previous comments by AC have suggested strongly that AOH and MMG are in contact already, and if Xstrata walk away, the expiry of the option mean AOH are free to pursue a partnership.

I'm actually starting to hope Xstrata do walk. The only problem left for AOH is funding, which admittedly is a darn big problem in this market. I doubt they can realistically expect to fund Little Eva themselves so there will have to be some sort of sell down of Roseby.

Anyway. I understand the frustration of everyone here, but this is great news IMO.