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Chawkey, I have resigned myself to the fact that I have no idea as to what effect the latest developments or future developments will have on the share price. I say this because ORD is nearing one of the most undervalued stocks on the market. I cant understand why we are trading at such low prices given where we are.

I have just completed a round of analysis on local Bauxite producers and its throwing up some interesting facts. Its always good to compare against peers to ensure your investment is as good as you think it is. I'll post this up in the next couple of weeks.

In terms of ORDs/SARCOs resources - its a bit more than extending mine life. You are right the bigger the resource the longer ORD will be able to produce, however it also means:
a) If production rates can be ramped-up, they will make more money faster. The more resource they have the more they can produce over a sustained period of time. 600K-1.2mtpa is conservative. Months ago I posted some analysis on value and I specifically did not discount the profit figures as I believe the number of years that ORD will be in production will be longer than 20.
b) The more resource the company has the better supported an IPO will be. Its better to come to market with an enormous JORC than a resource that is looking to "be expanded". The great thing about ORD is that it will come to market will a huge JORC AND the JORC will be expanded. ORD is currently the largest OZ holder of Bauxite resources, excluding AWC Ltd. IRM is pretty close at 89.4MT. ABZ is at 84MT, but its grade is amazing at around 45% total Alu, where ORD has got circa 29% total Alu.
c) The larger the JORC the better 'placed' the company will be. Dont forget the resource is an asset to the company. It derisks many things not just the project feasibility. Conceptually ORD/SARCO 'could' sell the bauxite which btw, is trading very strongly. This would avoid the cost and risk in building a refinery. The bauxite is worth billions of dollars and all ORD has to do is dig it up. The resource is at shallow deep, thin overburden, and high utilisation/low cut-offs. Classic example: 180MT x current bauxite FOB price @$40/T = $7.2Billion. Opex will be a low at around $30/T, which means profits margins of $10/T, or 1.8Billion. We need to share this will NFC but thats still around 800Million to us. If this seems unbelievable to you, feel free to check my figures, I could be wrong but I doubt it. It assumes we just dig the bauxite up, with no IPO etc.

On the Caledon option. I have speculated on what might happen with the option - my suggestion will never be a negative Chawkey as the option was acquired at zero risk. Sometimes we need to take a step back and not over complicate things. Reflect on what the option is: GRAM gave ORD the option to acquire 5-10% of CCD at the accepted bid price post financial close. Now, you have to ask yourself..if ORD had 50Million required to exercise the option why didnt it just buy CCD ON MARKET. The answer is it doesnt have 50Mill and it never had any plans to buy a stake in CCD. If ORD had 50Mill at its disposal we'd be at 50cents and rolling around in SJ gold. The key with the option deal is to find a way to extract a value from it. I obviously have my own view on how they will do this.