Very cautious reaction today, which is understandable considering the volatility in the market.
Still below the 30 cents paid by MEL.
India, having restricted iron ore exports to China in response to their own domestic needs ( India way behind in infrastructure development compared with China) will be looking at overseas markets for their future I.O. requirements. Recent reports have stated a global shortage of I.O. so it is likely that MEL would be a "life of mine" purchaser of any production from Gum Flat, which is nearby to rail, road and port facilities. Set up and production costs will be much less due to MEL's extensive I.O. mining and production experience.
With production spoken for financing wont be a problem. Yes, I know its early days but cant help being impressed by management foresight. They are playing it conservatively yet confident. Progress report in the June quarterly mentions an exploration target of more than 250 million tonnes. Now that’s a good start!
Regards RBA
LML Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
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