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205 Posts.

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27/06/14

15:09

Post #: 13581102
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Originally posted by In Da Hood ↑

Hi Zoomy & others,

Going off the non DFS $56/t figure from 2010 it's actually $36/t profit so I rounded down to $30/t which was CNF to Qingdao not sure if it factored in state royalties.

The MUIOF comment is in my own opinion based on the likely hood that Rio and Roy Hill's additional 100mt by mid 2015 will make the other minnows unviable And life very difficult for FMG as intended IMO.

GWR was talking $75/t break even at best, the magnetite is forgettable in the current climate as Grange Resources will probably be the next one Into receivership after Cairn Hill being the highest cost producer in oz plus Gindalbie and Citic have real trouble making any cash.

Which minnow do you like for the MUIOF? Most lack any DSO of substance, FAS has 24mt and probably 100mt more in SHIP north from a channel deposit such as Yandi fines which are the 2 lowest cost iron ore mines in the world Rio's being slightly cheaper at $16/t over BHP's before you add in state royalties of course the point is channel deposits are a gold mine.

Granted slightly lower grade than Platts 62% FE but the Japanese & Korean steel mills loves the fines so if it's anything like Yandi ore none of that is even bought by China leaving it impervious to a potential China slowdown In terms of ability to sell the ore price will drop but I'd say a further leg down May be on the cards. Hence my view MUIOF is dead unless MinRes or Cliff's have a wonderful cheap iron ore deposit to develop in a good transport location. FAS has the only credible deposit to lend against and they've repeatedly stuffed up looking for finance lol what a joke. In sight of retrospect a DFS would have been great and they should have used the GWR share sale to do just that in theory the alluvials on top are easy to mine so a closed loop freight review etcetera seemed like the way to go in a tough market when speed to beat your competitors to the port space is out the door doesn't look like such a smart decision to forego the DFS.
The tougher the iron ore market becomes the more likely a takeover target FAS.becomes I would imagine the one thing they aren't joking about is the fact the SHIP deposit is a unique and desirable deposit Someone will develop it.

Cheers

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Hi IDH
FAS has mentioned 18% recovery in a presentation a while ago, so without a feasibility study do not see how it is going to make a reasonable return. I do not understand why you say SHIP is the only credible deposit to lend against.

Surely FAS would release information if SHIP really was desirable and it makes me think if there is a reason other than money for no feasibility study.

Would like to understand your perspective and how you came to be so positive.

FAS Price at posting: 0.4¢ Sentiment: None Disclosure: Not Held
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