With SDL in the past having struggled to secure a strategic partner for the project, I have always wondered why SDL don't focus on proving up more resources, in order to generate some interest and create some excitement amongst the market and potential strategic partners.
I believe that SDL have a lot more Iron Ore in the ground, then what they publicly promote or have lead us one to believe, and I also think that they have really just scratched the surface with their drilling results to date. But my question is, if SDL have struggled to secure a strategic partner in the past, why haven't they been trying to sell the company, by spruiking about just how much potential resources they actually have.
Over the past 12 months, I have been a little disapointed with the amount of drilling results, considering how much potential resources they have, and how much time they have had to prove up more of these resources.
To me, the above just doesn't make any sense. If you are trying to sell or find funding for any business, you always put your best foot forward, and try to talk it up to its full potential. However when it comes to resources and drilling results, SDL have always seemed to play things rather conservatively, and not tried to get too carried away with the potential or possible amount of resources.
I am just speculating, but I have been wondering as to whether or not SDL have strategically been doing this on purpose. While they haven't appeared to be focused on publicly proving up more resources recently, I am just wondering whether they have busily been drilling away in the background and waiting for the right time to announce a massive resource upgrade.
Now I appreciate that they can't withhold drilling results from the market, however this doesn't mean that they can't set a drilling program, that aims to have the results released to the public on a certain date.
The perfect time to release drilling results/resource upgrade, would be once the permits have been issued, because this would not only further encourage Hanlong/China to seal the deal, but it would also stimulate more interest amongst potential bidders such as Xstrata/Core etc.
Anyway, I may be way of track, but if I was in charge of trying to get the best price possible for the project, that is what I would do and I am just wondering whether someone like Westcott has any thoughts on how much drilling SDL has done recently, and whether there is any chance that we could see a massive upgrade announcement over the next few weeks.
SDL Price at posting:
45.0¢ Sentiment: None Disclosure: Held
