Definitely looks promising for BCI, maybe they feel the article...

Definitely looks promising for BCI, maybe they feel the article below is what may play out and there ensuring negotiation leveridge.

Stokes’ 19% puts him in a good spot should Baosteel feel compelled to put its foot on a slice of Buckland – a potential competitor to Anketell via its mooted trans-shipment venture out of Cape Preston East.


BC Iron, Stokes and the night parrotTuesday, 19 August 2014

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IT looks like a budgie, comes out after dark and was almost Fortescue Metals’ nemesis. The Metal Detectivehas a warning for BC Iron managing director Morgan Ball: “Beware of the mysterious night parrot”. The Metal Detective, By Stephen Bell



Scotland has its Loch Ness monster and North America Big Foot, but the Pilbara’s most famous parrot is just as elusive when it comes to tracking down mythical beasts.


It is difficult, nigh on impossible, to find anyone who’ll admit to having seen one, although there are a couple of happy snaps on Google showing what looks like an overweight yellow-green budgerigar lost in the Pilbara scrub.


Yet this humble feathered beast has immense hidden powers.


Back in 2006 it almost derailed then young upstart FMG as it sought government permission to build the Cloudbreak iron ore project near the banks of the Fortescue River.


Now MD is getting a terrible premonition that we might soon witness a re-run of “parrot noir” upon completion of BC Iron’s $A250 million-odd friendly takeover of Kerry Stokes’ Iron Ore Holdings.


Up to now most attention has focused on the combined group’s Buckland venture in the West Pilbara, given its proximity to Aurizon’s mooted rail network expected to service Baosteel’s Anketell venture.


But MD, in looking at some of the maps released by iron ore’s newest bed partners, realised that IOH’s Iron Valley project in the central Pilbara is also a critical chip in BC Iron’s gamble to swap its annuity status for a combination of growth and income.


That’s because Iron Valley is only 50km or so away from Fortescue’s Christmas Creek rail-head – the point at which BC Iron’s Bonnie Fines product from Nullagine joins FMG’s railway to Port Hedland.


That 50km is separated by the Fortescue River marshes, the broad Pilbara valley that is the favoured habitat of the aforementioned parrot.


The same rare bird that forced FMG to include an environmental management plan for its Cloudbreak mine site based on an unconfirmed sighting three years previously.


All’s well that ends well, however, and the night parrot lived happily ever after – thanks to FMG agreeing to several federal conditions, in particular hunting down any feral predators before they had a chance to dine out on our feathered friend.


At this stage, Iron Valley won’t be encroaching on the parrot’s patch, as the project – due to begin production this quarter via a mine gate sale agreement with Mineral Resources – will be trucking ore to Port Hedland.


MD is sure than MinRes’ ore trucks will give any parrot nesting sites a particularly wide berth – the last thing the company needs is more egg on its face after taking a $17 million hit in its failed attempt to buy Aquila Resources.


But, with Nullagine’s reserves limited to five years, MD wouldn’t be surprised if BC Iron’s Ball and co-director Mike Young decide to talk turkey with FMG’s Nev Power about Iron Valley.


The latter’s 135Mt reserves of 58% iron or, relatively high phosphorous, product could be used either as a Bonnie Fines additive, or replace Nullagine once it peters out.


If Morgan Ball does have a cunning plan along those lines, he’ll need to cross the Rubicon, in this instance the Fortescue marsh and its mythical inhabitants.


Building a rail spur and bridge across the valley might ruffle a few feathers, so be prepared for the Night Parrot Season Two: Flight into Peril.


WA billionaire Kerry Stokes, whose Australian Capital Equity is expected to own 19% of the combined entity, isn’t quite as furtive as the parrot.


He’s more like the cryptic monolith in Stanley Kubrick’s movie “2001”: he sits there hidden from general view, enigmatic and stoic, subtly influencing the evolution of the Pilbara.


It promises to be a fascinating new chapter in Stokes’ engagement with mining.


For BC Iron, he is a good partner to have on board as a cornerstone investor.


After all he is loaded, and not going anywhere in a hurry.


Stokes has gained plenty of leverage to the iron ore boom over the last decade via his WesTrac Caterpillar dealership, but last year axed an estimated 1000 jobs at the heavy machinery dealer as the slowdown bit.


So WesTrac must be licking its lips at the prospect of the next big sales target – Baosteel’s proposed West Pilbara project.


Stokes’ 19% puts him in a good spot should Baosteel feel compelled to put its foot on a slice of Buckland – a potential competitor to Anketell via its mooted trans-shipment venture out of Cape Preston East.


Maybe Stokes will offload his 19% BC Iron stake to the Chinese in return for Caterpillar getting first dibs for the trucks and diggers at West Pilbara.


Call it a yellow equipment-for-equity-swap.


And for that deal at least, there wouldn’t be a parrot in sight.