Just bought some more , AGO's sp is cheap today , buy the dips ... while they last. Should see a bounce soon imho. Carmichael's tends to be the most conservative of the valuations and comes true fairly quickly.
ATLAS GETS READY TO RUMBLE IN THE IRON ORE JUNGLE Recent iron ore price settlement for the 2008/2009 Hammersley benchmark has prompted an update of the valuation of the portfolio of AGO s tenements. AGO recently raised $100m to accelerate development of it s Pilbara and Midwest iron ore projects and is advancing quickly towards becoming an iron ore miner in only 2 months time with first production from it s Pardoo project expected to commence by October 2008. We anticipate ministerial approval by the end of July, in addition to updated resources, reserves and mining by August 2008. Key Points: AGO is in the final stages of approvals before commencing mining in August 2008 at their flagship Pardoo project 75km east of Port Hedland. Initial mining rates will be at 1mtpa and moving up to 3mtpa in 2010. Resource and Reserve upgrades due in July 2008 for the Pardoo DSO, Abydos DSO and Ridleys Magnetite Deposit. Highly aggressive 18 month $55m exploration campaign targeting 120-180 million tonnes of direct shippable product. AGO undertook a highly successful placement in May 2008 which raised $100m to accelerate development of the company s projects in the Pilbara and the Midwest. Focussed exploration program with 5 rigs currently drilling the Ridleys magnetite deposit and 3 rigs drilling on Pardoo DSO projects. We anticipate significant increases in the Abydos, Pardoo and Ridleys deposit resources in July 2008. Aggressive acquisition strategy. AGO now holds around 9200km2 of iron ore real estate in the premier iron ore province on the planet. Highly encouraging developments for third party rail access for AGO to potentially gain access to the Goldsworthy railway with a realistic time frame that could become a reality within 4 years. Offtake negotiations are anticipated to be completed shortly. With mining to commence in August, we would reasonably expect offtake of AGO s product to be completed prior to this date. Our updated valuation for AGO is $5.09/share increased from our previous valuation of $3.06. We have used a conservative mining production schedule for Pardoo and Abydos with cash costs of $37 & $39/t using a combination of benchmark and spot market prices. EBITDA commences at $57m in FY2009 rising to $397m in FY2010 underpinning very strong financial growth. We recommend Atlas Iron Limited as a BUY to investors seeking exposure to the Pilbara s next iron ore mining company.
AGO Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
