Foretescue Metals has a market cap of $65 billion, zero net...

Foretescue Metals has a market cap of $65 billion, zero net debt, and 175 mpta of production. Fortescue has an enterprise value of $370/ton.

Grange Resources has a market cap of $640 million, $300 millon in cash using miningnut's figures, and 2.5 mpta of production. Grange has an enterprise value of $340 million or $136/ton. Grange is way undervalued compared to Fortescue.

A scaled down Southdown project might cost $1.5 billion to develop for 5 mpta. Southdown's capital cost of $300/ton is only marginally cheaper than Fortescue's $370/ton valuation. The decision to build the mine is a bit like a call option. It is better to wait and see if the iron ore price goes higher, rather than exercise the option now.