In the back of my mind all the time currently is the prospect of another market rout - potentially worse than the last one as all we have done in recent years is kick the can further down the road. More debt to service than ever. Iron ore companies not yet in production need to get there fast as competition is growing and this buoyant market will not go on forever.
Some dot points that need to be in place: - customers / off take agreements - funding - competent management and Board - ore quality confirmed (sintering characteristics sought by steel makers) - a commercially viable deposit (i.e. good strip ratio, grades) - transport to customer. This is the big one. no good having the ore if you cannot move it.
The above are but a few I would suggest.
Constant drilling may not be the action required. I would prefer to see a small resource proven and then get on with the business of moving it and turning it into cash via some key customers. The cash can then be deployed as seen fit to either continue drilling, M & A or otherwise.
Fortunately, the company has the benefit of all of this knowledge because all of the above has been learned from someone currently involved. He has done it all before!
If he replicates his successes here, SH's will be well rewarded...assuming the rout stays away.
No one will be immune.
MBM Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
