There has been a lot of discussion on the OZL threads about OZL...

There has been a lot of discussion on the OZL threads about OZL doing at/o of RXM. The general mood seems to be that it is the right thing to do, (for growth and current 2018 hole in production), the issue is the when.

I have been tracking RXM shares and on Friday they fell below 70c for the first time. 70c seems to have been a strong support line. RXM holders are as depressed as OZL holders (read the threads to get an idea what I mean).

As some posters have pointed out, REX is due to release it's PFS (Pre-Feasibility Study) this year. Please note - this is NOT a BFS (Bankable Feasibility Study) - the BFS will be released in 2013.

(Page 18 of the latest presentation has this timing. Here is the link http://www.rexminerals.com.au/wp-content/uploads/2010/10/20120731-Resource_Investor-Presentation_July-2012.pdf )

Personally, I think buying RXM before the PFS comes out would be a t/o with high risk. RXM's sp (like OZL's) is in a downward trajectory. Waiting for some certainty from the PFS would mean that the t/o is significantly derisked.

RXM's ability to get funding to bring Hillside to production is close to zero. They would need to do a cap raising that was 3 times their market cap, and then borrow the balance, and, if anyone has been following HGO, find that there is a cost blowout and then need to do another cap raising. I would suspect that RXM is waiting quietly for OZL to come knocking.

The only issue with waiting is that another miner might jump in. But who? Hillside is a Tier 2 mine, the big boys are not interested. In Aust, IMO, OZL is the only contender in town.

HT1