All looking good. Liking the options - despite the fact the price is still technically 7c due to lack of sellers (worth upwards of 12 at current price).
Anyway, just thought id add an article from The Age to further highlight why we should be so keen on this stock.
Overview: BHP is willing to bet big on potash. They are rarely wrong.
Note: they purchased a junior with a large resource last year to get their foot into the heavily concentrated market. And have indicated they are unlikely to make any major purchases. I'd be willing to bet that a 2.5 billion tonne resource in the US held by a $10 million ASX-listed company would be of interest. All IMO of course. Just waiting on those permits...
"A BILLION-BARREL oil discovery or a 15-million-tonne copper discovery would excite the market in BHP Billiton, the world's biggest resources group. Because of its size, anything able to excite the market in BHP has to be big. Very big.
So what is the market to make of the assertion by BHP managing director Marius Kloppers that the group's Jansen potash project in Canada is "very exciting". Potash? Is BHP out to excite the market by becoming the world’s biggest miner and farm-product group?
Apparently so, judging by comments in London by Mr Kloppers. In the London interview, which followed BHP's recent annual meeting, he made clear that an expansion into potash - the common name for fertiliser forms of the element potassium - was an aim of the group.
"Our focus is on our Jansen [potash] project [in Canada]. We spent $US100 million on it last year, and we will spend more this year,"Mr Kloppers said. " And that is really the project we would like to get into production as soon as possible. We think it is very exciting."
The presence of potash in BHP' s portfolio of development opportunities harks back to the reign of former managing director Chip Goodyear. The financial crisis has since intervened, but the original rationale of Mr Goodyear, and now Mr Kloppers, in backing the potash push is the same. It's all about feeding the world. And when you are talking about a bulk commodity with (projected) high-growth consumption rates, a high cost of entry and where underground mining expertise is an advantage, potash just might fit the bill.
Since the financial crisis, much of the world's potash production has been shut down. The price, nevertheless, is doing OK thanks to concentrated ownership, which allows for shifts in demand to be quickly matched by production. The price is down since last year when it approached $US1000 a tonne. But at $US450-$US500, it is still well above long-term averages.
The shutdown in production and lower prices reflect the global farmers' choice to cut expenditure on the crop nutrient when times are tough. But with rising living standards in China, India and Brazil - all of which have potassium-deficient soils - the world can afford to "under-fertilise" for only so long.
As keen as Mr Kloppers says he is on BHP's push into potash, he has yet to articulate a business case. Investors will need to be assured that a potential $US5 billion to $US10 billion investment in developing Jansen is worthwhile. Given the tightly controlled ownership of the industry and its relative small tonnage, the question of whether BHP might be better served by acquiring a producer, notably the potash king, Canada's Potash Corp, remains.
BHP being BHP, it would not see an entry into the industry through acquisition or "greenfields" development as mutually exclusive. Publicly at least, the preferred route at this stage is the development of Jansen, situated in the vast potash beds beneath the prairie in Saskatchewan. Jansen is shaping up as an 8-million-tonne-a-year producer. At that scale, it would account for 16 per cent of the global market. Construction could start in 2011, with a possible mine life of 50 years or more."
TRH Price at posting:
37.0¢ Sentiment: LT Buy Disclosure: Held
