Ann: Trading Halt , page-9

Here is my understanding:

1, "a funding and product marketing arrangement"

"a" indicates funding is related with the "product marketing", from same party.

2, Just 5 days after "Multiple purchase orders received from Indian domestic steel producers" then the funding/market arrangement comes, indicates:

a, offer could be from one of these steel producers
b, ore quality is excellent
c, buyer/investor is quite confident

3, The purpose of the funding is to help NSL accelerate iron ore production to meet buyer's actual needs.

4, considering 3, the funding should be debt funding,in addition, NSL didnot mention CR,placement.

analysis:

1, "trial quantities (100 – 1000 tonnes) of iron ore produced"

should have been done, or buyer already found the ore quality is excellent, otherwise "marketing arrangement" cannot be finalized so quick.

2, whoever wanna lend/invest decent money to NSL,the trial result is the most important index , this is commen sense. It must already know the quality is quite good.

3, 200ktpa or 400ktpa is not enough to supply a medium size stell producer, buyer needs more iron ore supply from NSL, hense provides funding to help NSL accelerate production.

at 200ktpa, only 16kt/month, at 400ktpa, only 32kt/month, not enough supply even for a small steel maker.

NSL planning to rump up to 400ktpa by the end of 2012, 5 month to go, clearly this production rate cannot meet buyer's needs.

conclution: Buyer will provide funding for NSL to accelerate production to 800ktpa ASAP. NSL will sign off-take agreement with this buyer and further ramp up production immediately.

best result: NSL will achieve 1.5Mtpa by the end of 2013, not 2014.

Whatever the actual case is, funding to help NSL grow quickly is welcomed!

cheers