ansteel , page-5

Well YE 2011 will only see 4mt of magnetite mined as production begins in Q4 2010. I believe your predicted SP is prudent as I think PE will be higher because:

- Magnetite would have been mined for 6 months only.

- Large scale infrastructure setup, with capacity to significantly surpass initial 11mtpa startup production (4mt pellet, 4mt concentrate, 3 mt DSO).

- Generating a profit (assuming it does) as a start-up operation should create confidence among investors.

- Port Oakjee "should" be under construction with a finish date established. Market will assume greater tonnage to come in the future. Would be foolish to believe otherwise.

- The world economies should have settled (in theory) and the outlook more certain. Hence GBG's expansion plans should come apparent via Ansteel. I'm hoping we hear expansion plans via Lodestone on top of Karara in a few years time.

I realise I have made a lot of assumptions, however this is why I have invested so much in GBG. In the long term the potential is really there. The dilution is a $%^& to my projected EPS however at least it ensures our project goes ahead given the economy "fell off a cliff".

I am also under the impression that IO prices should decrease over the next 2 years. However it will level out and begin an upward movement assuming the economies pick up. A 40-45% decline from current contract prices would mean we revert to 2007 IO prices. It should probably stablise just below 2007 prices after 2 years of decline.

I agree the hype of IO is gone in most cases, however some stocks like FMS never cease to amaze me.