LOL... I allways wanted to say that Bah!...lol Max....Here's the last bit of FA sounds good money in the bank grades are Ok they are in the Pilbra so thats good, they need to get it to port?..but the SP has been belted, there was a small H&S on the weekly.. Looking like a candle bottom on the weekly needs to confirm..worth keeping a eye on wouldn't jump the gun just yet TA WISE..BUT GETTING CLOSE.. Cheers Pete.
21 October 2008
Dear Shareholder,
On behalf of the Board of Brockman Resources, I wish to reassure you, our shareholders and stakeholders, of the very strong fundamentals of Brockman Resources as a Company and, in particular, the Marillana Iron Ore Project.
The Company has demonstrated significant strategic progress over the past year and has successfully transitioned itself from anexploration company to a potential iron ore producer. We are in a strong financial position with in excess of $105 million in cash, which enables Brockman Resources management to progress current planning with a diligent focus on project financial fundamentas and deliverables, independent of the current turmoil being experienced in global financial markets.
I would like to take this opportunity to highlight the Brockman Team’s achievements over the past year and confirm our Strategi Path going forward.
Key highlights for the year include:
�� Delineation of a 1.6 billion tonne JORC compliant mineral resource at Marillana �� Confirmatory testwork indicating that the detrital ore can be upgraded to a marketable 59‐60% Fe Product �� An estimated final product resource of approximately 952 million tonnes – including both Channel Iron Deposit (CID) and beneficiated detrital ore �� Two successful capital raisings for a total of A$120.6m �� The significant signing of a Native Title Agreement with MIB for mining rights at Marillana �� Recruitment of industry specialists experienced in the development of iron ore projects �� Ongoing negotiations and discussions with Third Party Infrastructure owners and regulatory bodies in relation to haulage and acess agreements �� Reservation of port infrastructure berths and associated infrastructure through the North West Iron Ore Alliance (NWIOA), of which Brockman is a founding member �� Completion of 650 drill holes for 33,000m, including 50 holes for metallurgical testwork �� Exploration success at Duck Creek �� Securing of additional strategic iron ore tenements within the Pilbara – 19 tenements in total �� Admission to the ASX 300 List �� Project development to date has been achieved with full safety, environmental and heritage compliance In the current financial “climate” it is essential to reinforce that we have in excess of A$105 million in cash reserves. These funds are secured in term deposits, with varying maturity dates, and are accumulating interest on a daily basis. With 132.7 million shares on issue, the current Market Capitalisation of the Company at $0.55 (Monday 20 October) is well below the cash backing. Simply put there is negative value ascribed to our 1.6 billion tonne resource and the strong project development progress to ate. This demonstrates the extreme volatility and irrational valuing of companies in the current financial market.
The cash reserve is being prudently managed by Brockman, and will provide the Company with the necessary funds to progress the Marillana Project.
Brockman is strategically and diligently assessing its Project Development Plans in light of the current developments in the maro and microeconomic environments. The Company will continue with the development of the Marillana Project, with a continuing diligent focus on project financials and marketing fundamentals. The following project activities will proceed and will be reviewed as each key milestone for decision making is reached.
�� Marillana Project Drilling ‐ the drilling program for calendar year 2008 is ahead of schedule (as previously reported) and will be completed by month‐end. The specific metallurgical test work drilling campaign (i.e. Sonic and Calweld drilling) was completed last week. One RC rig will continue for the remainder of the month to complete specific drilling for potable water bores, site layout sterilisation drilling and pit design confirmation �� The Definitive Feasibility Study for the Stage 1 (2 Mtpa Project) is progressing and will be reviewed in line with the key project milestones, with due consideration given to ensure the study inputs are reflective of current market conditions �� The Mining Proposal for the Stage 1 Project will be submitted to the DoIR in November �� Project definition and deliverables for the Stage 2: Feasibility Study (15‐25 Mtpa Project), are being developed with the preferred engineering consultant group, and are expected to be finalised by the end of October �� Discussions with several International Investment Bank Corporate Advisory firms have been undertaken over the past months and a appointment of the preferred organisation will be announced shortly 2 | P a g e
�� Significant work has been completed for submissions to Regulatory Authorities associated with rail access and/or haulage options – this remains one of our key focuses within the Business �� As a founding Member of the NWIOA – the Alliance is in the final stages of awarding the Scoping Study for the development of the Port infrastructure, required to support 50 Mtpa of iron ore, stockpiling and shipping at Port Hedland It should also be noted that a positive consequence of the recent global uncertainty has been a significant devaluation of the ustralian dollar against the US dollar, resulting in an equivalent 45% increase in the Australian dollar contract iron ore price since July.
The Board and management of Brockman Resources will continue to prudently review its cash spend during these turbulent and uncetain economic times to ensure we create value for the Company’s shareholders, while strategically taking advantage of the opportunity to move the Marillana Project forward.
I thank you for your continued support and look forward to regularly updating you as we progress our project plans.
Yours sincerely,
Wayne Richards Managing Director 3 | P a g e
BRM Price at posting:
57.0¢ Sentiment: None Disclosure: Not Held
