This is ocean's current view - they certainly have not lost faith ....
United Minerals Corp - Iron Ore Update:
Railway prospect alone provides various options for development (Mon, Sept 22nd) UMC is an emerging iron ore exploration/development play that is rapidly developing its iron ore tenements in the heart-land of the central Pilbara, close to existing infrastructure. The current strategy sees initial production commencing mid 2010 with minimal capex. The Company has recently announced its maiden JORC resource, which differentiates it from its junior peers, and ongoing exploration has the potential to quickly add tonnage and materially change the medium/longer term development strategy. Since we initiated coverage of UMC the Company has developed into a much stronger, significantly de-risked story and we believe these developments are yet to be reflected in the share price. Recently there have been a number of major developments in the iron ore sector supporting the aspiring junior producers including: above consensus increase in iron ore contract prices (which have increased 80%-96.5% y-o-y); break-through commercial agreements for infrastructure and development agreements; and an unexpected level of supportive local government policy. We highlight the fact that UMC is in an excellent position to benefit from the improving fundamentals for the emerging iron ore producers and an improvement in market sentiment, and see the current share price as offering an extremely attractive entry point. We believe the Company is well positioned to make the transition in the markets eyes from being just one of many early stage “hopefuls” to having the credentials to be a standout, viable near term iron ore producer with significant scale. Near term news flow is expected to remain positive driven by the following key catalysts: exploration drilling at priority targets, providing the potential for material new discoveries; ongoing drilling programmes and assay results to upgrade Railway’s resource
UMC Price at posting:
78.0¢ Sentiment: Hold Disclosure: Held
