Re your comments below. You say you hold, you shouldn't given your view. But let me say this. Analysts and the chinese have been saying this for 15 years. By the way, if priced do drop, last man standing will be a handful of which SDL will be one given exceptionally low costs. Also, the quality of IO is very high. Recently analysts have been steadily upgrading their forecasts.
SDL is not an expensive project in terms of payback and IRR (internal rate of return) AND that is at the low price of $65 per ton.
Let's say they ship 50 mt tons for other in a given year. Fortecue are argi bargi around $7 per ton. By 2015, call it $10. 50mt x $10 = $500 mill. Indutry PE is 10 say. That is 5 billion in cap. Five times what we are now. Every $10 per ton they get at 35mt (and there is a lot more than that I am sure)= $350 mil = $3.5 Bill Cap. Divide it by two for partners etc...and you end up with a hefty number. This is in addition to what is in the DFL re current status.
The investment is for infrastructure that in itself will be hugely profitable.
Your post of earlier today:
The only commodity that should fall back to a low price is iron ore, there is so much of it in the world. There are manny projects that will come into production within 5yrs.
Copper, nickel, and tin is in short supply. Coking coal and high quality thermal coal there is short supply.
SDL is a very expensive project has a long time lag from constrution to production. That increases risk.
SDL Price at posting:
36.0¢ Sentiment: LT Buy Disclosure: Held
