why i think investors should hold sdl, page-11

taipanoblehouse,

Think about this. Out comes the following announcement at the end of June after all the anticipation that has been building up.

"SDL signs EPC and financing MUO for Mbalam-Nabeba Iron Ore Project"

•Engineering Procurement & Construction and Financing Memorandum of Understanding (“MOU”) signed with "Engineering Companies A,B and C" and "Finance Companies X, Y and Z" for financing, construction and development of Mbalam-Nabeba Iron Ore Project.

•The MOU outlines the framework for cooperation to establish the cost and program for delivery of the Mbalam-Nabeba Iron Ore Project and the progression of the project to a full bankable feasibility stage, meanwhile all parties will cooperate to seek delivery of bankable off-take agreements for the full 35Mtpa of annual production.

•SDL, "Engineering Companies A, B and C" and "Finance Companies X, Y and Z" intend to enter into formal agreements for a full turnkey fixed lump sum Engineering Procurement and Construction Contract (“EPC Contract”) for construction of port, rail and mine.

•"Finance Companies X,Y and Z" to facilitate the debt funding of the project development costs through major Chinese banks, based on 100% of the EPC Contract turnkey costs, with an indicative amount of US$4.2 billion.

•Indicative project timetable envisages commencement of construction at Mbalam-Nabeba in the second half of 2017 following signing of the EPC Contract and finalising financing and off-take agreements, with the parties targeting Q4 2017.

Now taipanoblehouse what would you and the market make of an announcement like this. Good news is it, buying? Progress is being made but is the project really any closer to development. What does the announcement mean? Doesn't talk about how SDL will ultimately retain equity in the project. EPC contractors and their debt financiers don't care about the equity arrangement they are just their to get their money from building and financing the project. I'm sure the rusted on believers on this forum would be putting on their rose coloured glasses with this announcement and saying things like the project is full steam ahead. Yippy.

The only thing an announcement like this says is that SDL still has a chance as the financiers and EPC tenders wouldn't jump on board if they thought there was no chance of success. Shareholders of SDL would hope for an announcement like the one above as a minimum for keeping their hopes alive.

SilentO