cusp of major phosphate breakout.....

This is now my preferred phosphate or agricultural play.

Its is the only AG stock that hasnt yet put on 200%+.

It is one of only 4 ASX listed co that have a RESOURCE.

THEY HAVE A 500MT PHOSPHATE RESOURCE AT MT ISA QLD WITH EXISTING INFRASTRUCTURE.



Here is some research that was posted earlier


http://www.goldencross.com.au/proper...e-20071224.pdf

also more info can be found on the companies web page





Projects
Mt Isa Phosphate, 20% Free Carried by Legend Corp, Qld near Mt Isa and near to Incitecs exisitng Phosphate mine

Qld Govt Historic JORC 500Mt's@15%Phosphate

Now this is a historic resource and the only reason it deosn't meet the JORC standard is because it was defined prior to the existance of the JORC code, ie any deposits no matter how ell defined that were established prior to the JORC code don't meet it, but really its just a technicality

See for yoursefl on the Qld Govt Minerals Database
http://www.vizmap.com/NRM/Commodities/493685.htm
http://www.vizmap.com/NRM/Commodities/491206.htm
http://www.vizmap.com/NRM/Commodities/494076.htm
http://www.vizmap.com/NRM/Commodities/494100.htm



GCR's JV partner is Legend International a major Phosphate player in Aust, for more info on Legend see http://www.lgdi.net/

Now Legend are working towards getting the whole project area towards production, they recently completed a scoping study and have an updated presentation which shows cost etimates, margins, production scenarios and resulting profit scenarios as well as timelines etc well worth a look http://www.lgdi.net/pdf/Legend_Phosp...ril_2008v2.pdf


Valuing Mt Isa
EV
Now the task of putting a value on Mt Isa, my prefered method of valuation is to use an Enterprise Value or EV which simply gives a company a value per tonne of given resource

Now because the Poo sector is light on companies the easiest and most obvious way to extract an EV is to determine the EV being attibuted to GCR's big brother Legend

Legend current shareprice = $3.10 with 200m shares fully dilluted its MKT CAP is now $620m US = $680m AUD

Legend has a NET 1.3Bt's@15% Phosphate (1.4Bt's but 100mt's is GCR's)

$680m With 1.3Bt's@15%Phosphate = 52c per tonne ore @15% Phosphate or $3 per tonne Phosphate

GCR has 20% of 500Mt's@15%Phosphate = Net 100Mt's

@ 52c/t = $52m 8.2c GCR

To keep an eye on Legends share price ann's and mkt cap see http://www.lgdi.net/inc/redirect_share_price.php but remember the Mkt Cap given doesn't take into account the 20m or so options and thus is 10% under what it should be



A % OF IGV
Another methood used (though I'm not sure how credible) is to use 10% of a deposits IGV as the value attributable to a company. I AM NOT A FAN OF THIS METHOD

Mt Isa PHOSPHATE:
500Mt'[email protected]%P = 75Mt's of Phosphate

The current spot price for Phosphate is $350-$400 US/t = say $400 AUD roughly

So I.G.V. Mt Isa = 75Mt's x $400/t (current Phosphate Price) = $30BILLION now even though GCR 20% they have a net attributable amount of $6Billion

10% IGV = $600m = 95c


Conclusions Mt Isa
- Based on my prefered valuation the EV GCR is worth 8c+ on Mt Isa alone
-GCR is one of only 4 ASX listed companies with an actual Agricultural deposit
IPL's mkt cap is $8Billion
MAK's mkt cap is $275m
RWD's mkt cap is $130m
GCR's mkt cap is $25m

- GCR's deposits are between 60kms-150kms from IPL's operating Phosphate Mine
- GCR's project is part of a bigger project for big brother Legend kinda like the CUL/AQA relationship, the big brother has the deep funding pockes and expertise needed to advance these projects to production allowing GCR to advance its many other projects.