get ready for next leg up / valuation $3-$3.50, page-15

Just some back of the envelope verrrrrrry rough calculations on Sphere. All extremely speculative and slightly silly, but still, I can dream……

Total JORC resources 2996 million tonnes (Sphere’s share) of magnetite iron ore mostly @ 30% ish grade.

The plan is to process the ore to produce pellets at 65% grade odd. I think pellet value around $100 per tonne.

Shares on issue 147 million. Hence 20 tonnes magnetite PER SHARE. And, concentrated to 65% around 9 tonnes of pellets PER SHARE. Gross Value $900 of pellets PER SHARE ($1 share price!).

Of course the key is to be able to produce the pellets at a profit! No profit and the shares are worth nothing BUT, lets make a guess and say just ONE (1) dollar profit per tonne (1% profit) is made ---> it still gives $9 net profit per share (over the life of the projects).

It gets staggering if profit is closer to 10% ($90 net profit per share over project). It gets even more staggering when you relaise Sphere appear to have only JORCed less than half the available ore, so you can double all the above calcs.

Just imagine if a ten tonne truck turned up and dumped a full load of iron pellets on your front lawn for $1 !!!!