wpg in argonaut's morning note

Argonaut is not WPG's Corporate Adviser. But they mentioned WPG in their morning note as the winning formula.

http://www.argonautlimited.com/files/MN_0061_31_05_11.pdf

The Winning Formula
In identifying bulk commodity stocks, Argonaut typically looks for the following key ingredients; a quality product, infrastructure solution, low capital intensity and value.
Capital intensity is a measure of the capital required per tonne of annualised production.

High capital intensive projects are typically ?greenfi elds? developments, were signifi cant infrastructure (rail, port) is required to get the tonnes to market.

Argonaut has had a preference for low capital intensity producers, such as Atlas Iron (AGO),Mount Gibson Iron (MGX), Mineral Resources (MIN) and BC Iron (BCI). Emerging
player, WPG Resources (WPG) fits into this category too, with a capital intensity of ~$43/t (see chart below).
Whilst these projects tend to have shorter mine lives and higher operating costs, this is often outweighed by the quality of tonnes and the ability to capitalise on buoyant
prices.

These stocks have tended to outperform the larger capex players in recent years.