Oils. They're a big player in this field and have been for a very long time. You may as well be asking, why Newmont digs up gold, or why Woodside is producing oil. It's just what they do.
They've been digging it up before this cyclical mining boom even started and are profitable even at the troughs we've seen in the prices.
They have an existing large scale, low cost iron ore operation in Winderling adjacent to the project they acquired from AWD back when it was called GDN. The synergies are obvious. And they're local experience in that area (political and also geological understanding) made it a no brainer.
The royalty estimate is based on AWD's knowledge of the area before they sold. The exploration data is all with Cliffs now including all the additional and ongoing drilling they have carried out and continue to carry out on our old tenements.
As they're ore-reserve grows, so too does the amount of money that will come our way as a royalty payment in the coming years. This is why it would make sense, if you were Cliffs, to just buy it out and enjoy any upside to full effect instead of just giving it away.
In either case, we come out winners.
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