Analysing everything in terms of the dividend only is silly. FMG...

Analysing everything in terms of the dividend only is silly. FMG is a business with earnings and risk.

The point of IBO is not its effect on the dividend. The point is its effect on FMG as a business. IBO is an early step towards completely changing FMG as a business including changing its growth and risk profile.
FMG is a low grade and low inventory producer compared to the other Pilbara majors and competes directly with them as a blast furnace feed. That puts it in a relatively weak position at the moment and explains its low earnings multiple compared to the rest of the ASX.
IBO creates a different high grade product feeding new steelmaking technologies instead of old fashion blast furnaces. It moves FMG away from competing with the other Pilbara majors and towards a new market. The new technology for the flowsheet will also open up new opportunities if the flowsheet works.
Thats why IBO is a big deal. Forget the IBO effect on the dividend it doesnt mean anything. If the IBO commissioning goes well its a massive plus for FMG as a business. FMG then becomes the only major in the Pilbara with a genuine growth profile.