i think our comparable resource is the giralia transaction...

i think our comparable resource is the giralia transaction (about $2 a tonne)

a mate of mine was at the egm yesterday and said the following (as a result some 'informal talks' after the resolutions were passed):

-they'll start drilling about 8 weeks after completing the transaction (due to getting govt approvals). getting the money is pretty much in the bag (just have to collect on everyone's committments)

-they are very confident that they'll be able to DOUBLE the resource size in a few months i.e. to about 150mil tonnes (this is what the independent geo AND their iron ore consultant said)

-they will start negotiating ASAP for their next tenement, which borders wonmunna and is currently owned by FMG

-the NPV of the project (mine gate sale to a major mine nearby) is anywhere from $100mil to $200mil+ (depending on the output of the operation)

-imants said there was 'at least' a 70% chance of the mine gate sale happening because wonmunna's ore matched almost perfectly with the ore needed by the other mine (apparently he hinted it was rio, though there were a few interested parties)

-he said they should be producing the first ore from this project in about 2 to 2.5 years.. very keen to get moving quickly but the slowest part was getting all the necessary approvals. apparently under their independent financial moddelling, they'll net $24mil from their first year of operation, and it increases from there (also said the models were very conservative)

-there was discussion about the rhodes ridge project, and imants kins apparently mentioned that the people putting this deal together have very close ties into rhodes ridge, and 'rico resources' will leverage themselves into that project in whatever way they can (apparently he also said that it could happen quite quickly)

-he said they had pitched the full strategy to TLM and they (including kerry harmanis) were right behind them and believed in what they were trying to do in the pilbara


the overall impression was that they have got the project for a huge bargain and will look to increase the share price / value very quickly. there's a heap of drilling / exploration upside, plus new projects they will look to acquire.. and they won't need to raise cash any time soon. after this they'll have about $9mil in the bank which they'll use to increase the resource base


shame it's suspended - it'd be nice to buy some more after that news !!