some interesting context fact vs fear

with all the negative talk, I thought it might be time to take another look at the company anns.

I did a similar process some time ago in consultation with another poster and I found it strangely calming and reassuring as we systematically had another look at the project and did some number crunching. This doesn't involve numbers, it is a simple join the dots exercise.

From the recent update, yes there are reiterations of what has been achieved in the last 12 months, but of particular interest are the notes on Esperance port.

In April 2012 John Holland was awarded the project to expand port capacity.

http://www.earthmover.com.au/news/2012/april/april-5th/other-top-stories/john-holland-secures-100m-esperance-port-access-corridor-project

According to that website article, "construction is due to start in mid-2012, with completion expected by the end of 2013."

Apparently delays are causing massive angst.

According to Kate Emery of wanews,in June 25 2012,

"would-be miners in WA’s Yilgarn region [that's immediately east of the Kalgoorlie region] have gone public with their frustration over what they say is the slow progress of the Esperance Port expansion".

... "a lack of clarity over the project’s timetable makes it difficult for iron ore players to plan long term and secure project finance."

Gee, lack of clarity means delays in securing long term project finance for other miners!!

You mean...FAS is not alone?

The article went on to "the danger, at least according to Yilgarn Iron Producers Association boss David Utting, is that the window of opportunity may not be maximised.

Industry views differ on just when the iron ore price will flatten out. But most players agree a plateau is inevitable; it’s just a question of when."

Yep, so that critical infrastructure delay meant that it collided with the event that Iron Ore prices did indeed flatten out.

Logically this in turn led to more delay as the producers then need to wait for more favourable conditions before locking into deals with poor IO prices.

So what have FAS been doing? Sitting on their hands? apparently not...

According to the update ann, FAS participated in the end users consultation project run by Esperance Port. see http://www.esperanceport.com.au/ for background on this process.

FAS also contributed to "developing a unique solution" to the bottleneck at Esperance Port. This apparently involves a 3 stage solution.

If my eyes don't deceive me, (and the ann doesn't deceive me either which is a material risk according to some in here), FAS has also developed a Cost and Freight Closed supply loop chain from SHIP to target market ports and back.

Gosh I wonder what that could mean? Does it mean progress is actually being made by FAS? Surely not?

Wait, it says engineering plans have been completed.
(ask yourself: does it really sound like they are going to shut up shop and zip off to Argentina any time? I am not convinced from this progress that it means asset stripping is more likely either, but that's just my opinion).

Ah yes, the plant has been designed to accommodate the Fe content. That's right, I recall from my last lengthy investigation into the announcements that the Fe has particular characteristics which mean that concentrating and cleaning must be customised. That involves concentrating a few minds as well.

OK, the tenements to the north have been acquired, good. Because the resource was still open up there as I recall. Perhaps someone else might check that...I'm getting tired here.

Ah yes, it is still open or they wouldn't need the program of 597 hole works. That's a drilling program I assume for the part of the resource that is not closed off. Or a lot of well well wells.

The ann ends with some reassuring words and those who are genuinely interested might like to cast their furtive eyes over it. As I read it they are still aggressively pursuing funding options, including discussions with FRL commodity management.

I think it might be appropriate to look at what other companies have managed to achieve in this time. Take a look at what other companies have had to do, I think Century mining has had to continue sending ore to Fremantle port pending the resolution of the Esperance issue and they are obviously already a producer.

DYOR, and check my research by all means. All clarifications and corrections gratefully accepted.

Looks more like a buy and patient hold to me.

DV