DDzx,Thanks for your views.I like to discuss some of your...

DDzx,

Thanks for your views.

I like to discuss some of your points:

1. "Alumina Limited received US$80 million of fully franked dividends from the AWAC joint venture during
the quarter."

My comment: Is there possible to receive a dividend from the profit have made for the current period? Its unlikely to be true. AWAC even didnt know how much profit they would make when they paid fully franked dividend to AWC.

2. "for example, currently ORD has 500m shares & options on issue"

Refer to the company March 2011 Quarter Report.
Total issued shares: 470m
Total options: 35.5m (as listed below)
Strike price for 28.5m options are well above current share price.

Option Exercise Price Expired date
17,00,000 40c 30 September 2011
5,202,000 5c 31 March 2012
1,878,609 7.5c 31 March 2012
11,500,000 10c 26 November 2013

3. "if ORD was required to raise 49% of $200m in an IPO at 20 cents, that would be another 490m shares"

Refer to the company announcement on 3/5/11.
This assumption is highly unlikely.

My comment:
The main reasons why ORD is going to surrender their some share in Laos Bauxite/Alumina Project to realise the shareholders value,

a) Get institutions involved and raise the company profile - Second to AWC in ASX.

b) Institutions & other investors would be willing to contribute $180m - $200m for their 30% share of SARCO post-IPO. How much would ORD retained 34.3% worth?


VALUATION FOR LAOS BAUXITE/ALUMINA PROJECT

It is very hard to value sp by using NPV method for the project.

The initial production and current JORC resource will be significantly upgraded in the medium/long term. It is not wise, just picking 600,000t but ignoring the huge resource (between 130Mt-2,000Mt)

As I mentioned above, the IPO will give an idea how much Laos project worth to ORD. will be around $205m for 34.3% retained share of SARCO.