... and strong support in London - this is from Ocean - as usual...

... and strong support in London - this is from Ocean - as usual .... one day some leading aussie broker may wake up -one day ..... UMC just need patience and, in these markets, sange froid .... my money is still on December 20th for $3.00.

From Ocean today

News
UMC has announced that it is now receiving assay results from its infill RC drilling program that is being undertaken on the Railway deposit aimed at upgrading the 111m tonne JORC inferred resource announced in July 2008 to the indicated category. As part of that program, drill hole Ul 314 has returned 117m @ 63%Fe, including 30m @ 67%Fe; the best intersect returned so far from the Railway deposit. Two diamond drills are currently operating at Railway, with 21 diamond holes having been drilled, primarily twinning existing RC holes for geological, assay and metallurgical information, and where appropriate deepening a number of holes where previous drilling ended in high grade material.
In addition to the infill drilling program at the Railway deposit, the company has been drilling exploration targets at Jumbo Junction, Railway East and Yandi Headwaters, with 112 RC holes drilled on Jumbo Junction and Railway East, and 14 RAB holes drilled on Yandi Headwaters. Assay results are expected to be reported in the upcoming quarterly report.
The company has also announced that newly appointed Project Development Manager Sten Soderstrom, has commenced work and is developing a work plan for the advancement of the Railway deposit, to include metallurgy, environmental management and integration of geology through to mining reserve status, hydrogeology and pre-feasibility studies to the project.
On the corporate front, the company has stated that it is currently negotiating and evaluating various alternative strategies and proposals with and from 3rd parties.
Implications
We are very encouraged by the rate of progress that the company is making on its Pilbara iron-ore tenements, and in particular the flagship Railway project. Drill hole UI 314 is significant – its grade of 63% Fe over 117m (including 67% Fe over 30m) compares favourably to the overall grade at Railway of 57.70% Fe for the 111mt resource (or 60.15% for the higher grade resource of 84.5mt).
While Railway on its own is a company making project, we look forward to the results of the drilling that has taken place at Railway East, Jumbo Junction and Yandi Headwaters which will be included in the upcoming quarterly report which we anticipate should be released to the market by the end of October. This will highlight the prospectively of UMC’s remaining tenements which are strategically well positioned, being located within a 50km radius of 6 of the largest discoveries/production centres within BHPB and RIO’s iron ore portfolios. Of these exploration targets, brief details of which are set out below, we believe that Jumbo Junction is probably the most exciting and has the potential to be bigger than the Railway deposit based on its aeromagnetic signature. Refer to Exhibit 1 on page 2.
• The Jumbo Junction prospect is a Marra Mamba target that lies on the western nose of the Weeli Wolli anticline, only 5km directly along strike to the west of BHPB’s Area C. Jumbo Junction has a similar but larger aeromagnetic signature to the Railway prospect.
• Railway East is a 6km strike zone under cover, east of the main Railway prospect. Included in the target is a long shallow Marra Mamba formation as well as a hematite detrital target area.
• The Yandi Headwaters project outcrop 6km to the NE of the Railway deposit. The target area has the potential to be the headwaters to the Yandi Channel Iron Deposits which form major production centres for both BHPB (Yandi) and Rio Tinto (Yandicoogina) and include resources exceeding 2.5bt of CID.
On the corporate side, it comes as no surprise to us that the company has confirmed that it is in discussions with a number of third parties, and in this respect we would anticipate that these discussions will include BHPB, RIO and FMG with whom the company will be seeking to negotiate access to infrastructure (either through a MGS or access to rail networks and port facilities).
The intriguing part of the announcement is that the company has also stated that it has received proposals from 3rd parties. In our recent note of 22 September, United Minerals Corporation, “Iron Ore Update – Railway prospect alone provides various options for development”, we explored the potential for a strategic or financial investor to take a role within UMC in the development of the Railway Poject. In particular we highlighted our belief that Railway fulfils the basic criteria for an Asian steel manufacturer of being able to provide 2mtpa+ of production over at least a 10 year mine life.
Key Events / Valuation Triggers
Near term news flow is expected to remain frequent and positive dominated by the development of UMC’s iron ore projects including:
• ongoing drilling programmes and assay results to upgrade Railway’s resource status and potential tonnage;
• continued diamond drilling at Railway to determine “Value in Use” criteria for ore sales;
• exploration drilling at priority targets, including Railway East, Northern CID mineralisation, and Jumbo Junction (drilling is ongoing);
• outline of findings of economic evaluation studies;
• new and ongoing discussions with a number of infrastructure owners in the region; and
• further development of the ongoing pre-feasibility study for infrastructure access.