I am the biggest unbeliever in laterite nickel here, so it might...

I am the biggest unbeliever in laterite nickel here, so it might be surprising to some of you that i actually like this stock (and bought on Friday @ 5,5c).

Unlike the other low grade (not just laterites) nickel companies in Australia, eg SHN, JRV etc, PEL's project is slightly different.

1. The project is not in Australia, so the high production cost pressues wont be as much of a factor.

2. It will not require a plant...basically the ore will be scooped out of the ground (at 5-25m of depth) and stuck on a barge and shipped. In other words capital costs will be virtually minimal (a onsite office, some infrastructure) and production costs wont be very high at all.

3/ The company does not need to extract the nickel (as per pt 2), basically they just get paid a set amount for the laterite ore that is put on the ship...the calculation for this is complex (see new State One report on pelican website) but the revenue would amount to several hundred millions of dollars even at a much lower nickel price.

Should note that still in due diligence so by no means a signed deal.

Apart from the romblon nickel project, also has a decent gold project in the Phillipines...though also very early stages...kind of similar to MMLs Saugon project.

They are also receiving a 50c per tonne ore from Cockatoo Island iron ore proejct, which equates to around $120,000 revenue per quarter which should help with cashflow.

Worth a look imo. Comments welcome.

Cdchi1