Ann: Letter of Intent with Panyu Chu Kong Steel P, page-5

re: Ann: Letter of Intent with Panyu Chu Kong... It is interesting to note this Chinese company is in the oil & gas industry. Looks like they will be making steel pipes and other stuff to sell to others. I noted CNOOC being one of the major operators listed on that company's website.

So the concept of importing semi-finished product from Australia, rather than simply iron ore - is workable. Even after the higher wages for Australian workers.

Having slabs ready to be processed into finished goods definately an attractive advantage. If you are the Chinese company this means that you bypass many layers of red tapes (pun intended) and middle-man such as iron ore & coal importers and local steel mills who would also make some profit in the initial processing of the raw iron.

Less processing work done in China also means less carbon emissions there. Would our buyer be offered some incentives from the Chinese Govt.? Not sure.

Just a few thoughts here. It's been a long while.