mzi in a nutshell - worth a spec buy ? yes imo

Current updated summary of Co below with pros and cons. Do your own research to confirm...

Pros
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Zircon producer just started - Tiwi Islands

1. High grade mineral sands mine with mining that has just started. Expecting to produce 42kt / in next 6 months
2. Estimated production cost per tonne of $450
3. Sale price of $1000/tonne expected by end of year
4. Net profit Margin of $650 / Tonne * 42kt (Plant capable of producing 80kt/yr)
5. Profit after costs but before tax of $27m (1st 6mth)
6. Vast exploration upside given holding of land (250-300km of Tiwi is coastline with many target areas not drilled) Existing Mine Area on 5km Approx.
7. A commodity which the chinese want and must import
8. V.close by sea to China (ie Tiwi Islands)
9. Off take agreement signed by Chinese
10. Contracts for mining and shipping in place
11. 1st delivery in July
12. No more capital required.
13. Resource upside available drilling to start soon.
14. Feasibility at 1 treepoint expect to increase mine life to 3 years.
15. Infrastructure in place Slurry Pipeline, Barge to Ship.


Keysbrook WA - Leucoxene/Imenite: Leucoxene/Ilmenite produces a white powder which is highly refractive and ultra-violet absorbing. It is used as an opacifier in house and car paints, sunscreens, plastics, paper, and textiles

1. "World Class" high grade Leucoxene/Ilmenite deposit Reserve 41mt at 2.7% to produce 1.2mt HMC comprising: Proven Res 39mt at 2.7% and Probable Res 2mt at 2.6%)
2. Shallow(0-2m depth), flat land, no vegetation, simple dig and truck
3. WA Govt Approvals granted
4. Current market price approx $430-50/t
5. 7 year uptrend in Market price for Leucoxene/Ilmenite
6. Offtake agreement signed with Dupont.
7. Estimated mine life 8 years @ 80kt mined per year
8. Production targeted for late 2010 early 2011
9. Close to established infrastructure, port
10. Value in ground of $288m
11. Gross profit likely to be around $36m a yr (Uncertain of prod cost at time of writing but likely to be cheapish)

Other:
1. Market Cap of 11m @ 2.4c - Cheap relative to potential profit year on year
2. Dropping all other projects and focusing on these Tiwi and Keysbrook.


Cons
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1. Questionable history of some members of Mgmt
2. 63% owned by SRE:ASX (also with questionable Mgmt history)
3. Possible unsettled legal action regarding Offtake Agreement on Tiwi?
4. Resources on Tiwi beyong 6 mths have not been confirmed yet (Currently under Feas study)
5. Uncertain of plant requirements and production, shipping costs for Keysbrook.
6. Uncertain of how they intend to fund the start up of Keysbrook.