oppies worth 36mm bucks in the money, page-7

not that i know the numbers but i have the following thoughts:

1. one of the largest operating/capex costs assoicated with bulk commodities is transportation costs. How much do you think it will save transporting Fe only 10km instead of over 100km. Its OK for RIO/BHP who built there rail years ago on the back of massive high grade iron deposits. Those that sign a rail access agreement with either major (inc FMG) will be required to pay a significant amount on a per tonne basis to access rail and port infrastrucutre. I believe this reduced cost will partially offset the high operating costs assoicated with magnetite.

2. energy costs are also signifcant for processing magnetite. However CFE have a gas pipeline running through the middle of their tenement, providing access to a relatively cheap source of energy.

3. CFE may not have access to port but they have a signifcant coast landholding suitable for establishing loading facilities. I have no idea what it would cost to build suitable port facilities for 10mtpa however you would think every company in the pilbara would be excited about additional port facilities, so should a major funding partner come aboard they may bank roll new infrastructure with the idea of providing the facilities to other companies in the area (for a small charge of course)

4. i am not usually a big magnetite person, however given the resource size and possibilites for CFE i think it is very cheap compared to its peers and pellets also attract a signifcant premium, which is expected to increase in the future