For illustration purposes, the NPV model has been reworked using...

For illustration purposes, the NPV model has been reworked using significantly more adverse assumptions:

> Exchange rate remains high at 0.83 for the next five years
> Discount rate of 15% instead of 7% applied
> Full cost per tonne of Iron US$50 instead of US$40
> No further increases in the iron ore contract price

Though it is highly unlikely unfavourability to this extent will eventuate, if it does, the model still projects that Frances Creek will add $2.08 of value per share on an EBIT basis.

The TFE post on http://wacq.wordpress.com has been updated with a new .pdf that shows the above.

Encephalon

Disclosure: Long