# FRS - Ferraus Limited



## motion (7 August 2007)

Hi, 

I thought I would start this on FRS -Ferraus Limited

An interesting mining company mainly doing Iron Ore. I think this has some nice projects in the pipe line and with the current ann out seems to be one to watch.

FerrAus Limited (FRS, previously NiQuest limited) is an Iron ore developer focused on the Robertson Range iron ore project located in Western Australia. 

*Robertson Range Iron Ore Project (100%):*The Robertson Range iron ore project is located 100km southeast of Newman in the SE Pilbara region, Western Australia. Rio Tinto explored the area between 1999 and 2001 and identified iron mineralisation over approximately 1km strike length. Surface samples assayed greater than 65% Fe, and RC drill holes returned 10 metres @ 58.8% Fe from 18 metres depth and 30 metres @ 61.5% Fe from 88 metres depth. Follow-up drilling commenced in April 2006. The RC and Diamond drilling is designed to provide samples for ore characterisation test work, to test extensions of the mineralisation, and to increase the classification of resources identified to date. An inferred resource of 16.3Mt@ at 56.8% Fe, 0.09% P, 6.3% SiO2, 3.6% Al2O3 and 8.9% LOI has been estimated. The company hopes to conduct a feasibility study by August 2006, with possible mine development as early as Mid 2007. 

*Davidson Creek (100%):*The Davidson Creek iron ore project is located northwest of Robertson Range and 30 kilometres east of BHPs mining operations at Jimblebar. Brockman Iron Formation, host to BHPs Mt Whaleback Deposits, is interpreted to occur within the tenement and represents a priority drilling target in 2006. 

*Murramunda (100%):*Murramunda is a recent exploration licence application located between FerrAus Davidson Creek and Robertson Range licences. Geological reconnaissance and interpretation of regional geophysical data indicates that this licence area is prospective for both iron and manganese mineralisation. 

*Enachedong (100%):*This tenement of 205km² is prospective for manganese mineralisation and lies about 60 kilometres south of Consolidated Mineral’s Woodie Woodie manganese operations in the Balfour Downs area. Exploration planned for 2006 includes geological mapping and surface sampling, interpretation of TM images, and trenching and RC percussion drilling.


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## jman2007 (26 August 2007)

motion said:


> Hi,
> 
> I thought I would start this on FRS -Ferraus Limited
> 
> ...




Hi Motion

Good to see a fellow Ferraus-ite on board.  To be honest I thought I'd missed the boat on this one as I belatedly watched the market happily assign a value of 1.20 ish p/s recently, a hefty premium in my view.  With trading back to more 'modest' levels, FRS possibly a good buying opportunity imo.
Cash reserves currently around $11.6M, with potential to add significantly more tonnage at Robertson range, add in Davidson Creek and you'd be looking at a fairly healthy reource.
Possible sticking points for me would be the BHP factor... if a rail sharing agreement failed to materialise, I guess FRS would be looking at a road train option to Port Headland from the Robertson Range area.  Additionally, I don't know what the infrastructure constraints are at the port at this stage, if there is a proposed expansion of facilities it would hopefully tie-in with FRS's production start-up 2009 ish

jman


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## grace (29 February 2008)

Initial jorc for Davidson Creek is due Feb 08.
Maiden resource for new south west zone due late 08 (target 5-10mill tonne).

Top 20 seem to own a lot in this, and I have compared the list 6 mths apart and not very much movement.

Not a lot of traders on this one.  Would you agree?


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## Muschu (29 February 2008)

grace said:


> Initial jorc for Davidson Creek is due Feb 08.
> Maiden resource for new south west zone due late 08 (target 5-10mill tonne).
> 
> Top 20 seem to own a lot in this, and I have compared the list 6 mths apart and not very much movement.
> ...




Hi
It's an interesting share and one that I have read some consider a quality take-over target.  There are some impressive principal share-holders and you may have noticed a buy of almost 3 million shares on February 14.  I have no idea where it is heading but am prepared to be patient.  They're into iron ore in WA and their reports read well IMO.


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## grace (29 February 2008)

grace said:


> Initial jorc for Davidson Creek is due Feb 08.
> Maiden resource for new south west zone due late 08 (target 5-10mill tonne).
> 
> Top 20 seem to own a lot in this, and I have compared the list 6 mths apart and not very much movement.
> ...




Sorry, that should read maiden resource for new south west zone due late MARCH 08 (target 5-10 mill tonne).

Top 20 as at 28 September 07 = 69.06%  Lots of funds in there.


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## grace (22 March 2008)

Well, lots of info due this month on Ferraus.  Not really getting murdered by the market.
ABN Amro initial coverage rated a buy.



> ABN Amro rates FRS as Buy - Initiation of Coverage - The broker estimates the Robertson Range project could produce 2m tonnes annually and together with Davidson Creek there is scope for the company to produce 5m tonnes per year.
> Infrastructure remains a key and the broker sees scope for the company to form an alliance or sign a rail haulage agreement, while also positive is the company has enough funding in place to finance its 2008 development program.
> 
> Given the potential of the company the broker initiates coverage with a Buy rating.
> ...


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## grace (1 April 2008)

Initial jorc for Davidson Creek out - all DSO  7.4 million tonne at 57.8%.

Also of note is new exploration target of 250 million tonne (was 200 million tonne) with 8 new targets of 30 million tonne each.  Well this 8 targets is 240 million tonne for Davidson.......and we already have 30.6 for Robertson.....could be some nice surprises coming.

Currently have a jorc on Robertson Range of 30.6 million tonne at 58.7% with this to be upgraded this quarter.

Note that Davidson and Robertson are all located within the same area.

Mininig application for Robertson has already been submitted with an estimated time to start of 2009.  Some 50 or 60 kms from rail line to jumblebar (please excuse if I have the name of your town wrong!) East Pilbara.  



> “This new resource confirms that multiple deposits of high quality, direct shipping iron ore occur within our exploration licenses. Our rapidly
> growing resource base provides us with a great opportunity to increase
> our production scale and support funding of transport infrastructure” said
> FerrAus Managing Director - David Turvey.
> ...




Not as good as a reaction as I would have thought though???


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## grace (1 April 2008)

A second announcement out today with the initial jorc for the South West Zone.  Also note 5 targets with 30 million tonne each.  That makes 150 million tonne target for Robertson Range.

Earlier today, 8 new targets with 30 million tonne each for Davidson Creek.  That makes 240 million tonne target.

All up I get 390 million tonne target.

Check my adds please.  I get a lot more than the 250 million they state.  Have I done something wrong???  

“







> The South West Zone resource contains high-grade iron ore from
> surface and is located adjacent to the current resource at Robertson
> Range. It will be included in mine planning studies as a satellite open pit,
> which will add flexibility to mining operations and allow for higher
> ...


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## grace (23 April 2008)

Great news out today.  New deposit found only 30km from Jimblebar rail (that's govt owned I believe).

New DSO target over 100million tonne grading 57 to 60%.

New overall target of 250 million tonne.  All looks good.

MC = $124 mill

Lots of upside with DSO being valued at about $4 tonne by the market.

Good to see them join the alliance.  That has my holdings of BRM and FRS meeting.  Now just GIR to go!

http://aspect.comsec.com.au/asxdata/20080423/pdf/00834827.pdf

I hold of course!


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## Spineli (23 April 2008)

Quite the performer in the last week or so! As you say, great find announced today....although I believe they have had the 250m overall target for a while now...they do have quite a bit to go to get to 250m tonnes Fe....

Grace, any news on transportation agreements with BHP on the proposed rail distribution of the good stuff to Port Headland yet?


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## Spineli (5 May 2008)

Junior Explorer Ferraus Limited got a lot of media attention today after Chinese - Western Mining Co agreed to buy a 10% stake in FRS. See the link to the SMH article below.

The placement could be for up to 15.9m shares @ 1.15 a share and is expected to inject fresh capital in the order of $15m+ into the junior explorer.

Apart from seeking 250Mt of iron ore within its current projects in and around the Pilbara region, WA, the most attractive element to its projects is the low Capex, situated very close to Port Headland for streamlined shipping...when that day eventually comes...

The article:
http://business.smh.com.au/ferraus-latest-miner-to-attract-china-interest/20080505-2ayp.html


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## Spineli (7 May 2008)

well well, shares in trading halt again pending another placement only 2 days after the placement to China Western Mining Co..


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## grace (7 May 2008)

Spineli said:


> well well, shares in trading halt again pending another placement only 2 days after the placement to China Western Mining Co..




Yes, just what is going on?  Planning on spending heaps of money soon obviously.  Perhaps they need to slip BHP a few bucks to hop on the train


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## grace (15 May 2008)

It is very quiet on this thread for an iron ore junior.  Thought I would post a chart.  FRS looking very strong at the moment (blue sky).

Target of 250 million tonne grading 58 - 60%Fe (although I seem to add up their targets at each deposit and I get 390 million tonne).

Mining application lodged 2007, and first mining planned for 2009 at 2mtpa.  Closest deposit is 35km from rail line.

jorc of 43 million tonne DSO.

SP = $1.43  Cash $20 mill
MC = $218 million fully diluted ($4.65/tonne, but they have other projects!)

Planning to jorc up another 50 million this year, and 100 million next year.  So far they have always exceeded their targets.

Here is a recent presentation.  Note that they don't just have iron ore...

http://imagesignal.comsec.com.au/asxdata/20080506/pdf/00839495.pdf


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## grace (22 May 2008)

Robertson range upgraded to 45 million tonne @ 58.9% fe today.



> Highlights:
> 
> The combined resource for the Main Zone and South West Zone at
> the Robertson Range project is 45 million tonnes (refer to location
> ...




Need to add Davidson Creek to this of course.


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## YOUNG_TRADER (22 May 2008)

Hmmm $200m mkt cap with 45Mt's@59% Fe = 26.5Mt's Fe

I reckon they've got about $25m cash on them (cash + placement + rights - exploration and development costs)

*So EV = $175m = $6.50/t Fe*

Interesting alot of W.A. juniour to mid players trade on an EV of around the $6 level


Biggest concern would be logistics, was watching an interview with Andrew Forrest last night and he made it very clear half the battle was transport the other funding. 

Any idea's on how this mobs going to transport the ore?


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## grace (22 May 2008)

YOUNG_TRADER said:


> Hmmm $200m mkt cap with 45Mt's@59% Fe = 26.5Mt's Fe
> 
> I reckon they've got about $25m cash on them (cash + placement + rights - exploration and development costs)
> 
> ...




They hope to get a state rail agreement - see previous investor presentations.

I guess my thoughts on all of the junior iron ore pack (advanced ones anyway) is that they should build another rail line between a bunch of them...  They could start at FRS and wind there way up to the port.  Just dreaming I guess.  Tigerboi might not like this though 

Don't forget nickel (JV with BHP near Silver Swan) and manganese deposits when making valuation.  I have no idea what they are worth though!


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## Spineli (22 May 2008)

Yeah nice little resource upgrade today (30%) for the Robertson Range Project to take the Main Zone to 40Mt@58.8%Fe + roughly 5Mt@59.6%Fe for the South-West Zone to give 45Mt (inferred + indicated) for Robertson Range thus far.

*Robertson Range Iron Ore Project*
Have a look at the attachment below which shows the Robertson Range project from today's ann.

Main + SW Zone is now at 45Mt@(58.8%-59.6%)Fe. 

The ann goes on to say that (Main + SW Zone) has potential to reach 50-55Mt.

Look at the other targets within the RR project: (Ann on 6th May says these targets have an exploration potential of 80-100Mt...."First results by mid ‘08" - hopefully some ann's soon regarding these target areas)
- T55500E
- T56500E
- T59000E
- T59800E
- T91000N

They all look quite nice on the Gravity survey...time will tell how much Fe is held in those regions...Whats the go with the Greenstone belt on the map?? looks pretty pink to me  (it forms part of their tenement)

*Davidson Creek Iron Ore Project* (Davidson Creek Prospect + Mirrin Mirrin Prospect + Taipan Resource + Gwardar Prospect)

- Taipan - Inferred = 7.4Mt@57.7%Fe (Target 15-20Mt)
- Gwardar - Potential = 25-30Mt 

Other targets within the Davidson Creek Project (see second attachment below)...again....if the company is estimating a potential of 25-30Mt for Gwardar....look at these targets....real potential there IMO based on Gravity survey (+size)

- T40500E
- T42500E ("*RESULTS EXPECTED IN MAY '08*")...nothing yet and 1 week left in May!
- T46500E
- T48500E
- T51500E
- T52000E

GOING FORWARD


"Overall at its Pilbara iron ore projects, FerrAus believes it has a
realistic opportunity to identify iron mineralisation and grow the
resource base to 100 million tonnes grading 57 to 60% Fe during
2008 and ultimately to 250 million tonnes (refer also announcement
released to ASX 24 April 2008)."

+ THEY HAVE MANGANESE AND NICKEL....

----------------------------------------------------------------

Grace, I notice you have been trying to add up their forecasts of Potential Targets...and you count much higher than 250Mt...

Based on what I have above...I get the following:

(Indicated + Inferred) = 45Mt (Main + SW Zone) + 7.4 (Taipan) 
(Potential) = +10 (Main + SW Zone) + 100Mt (other RR targets) + 12.6Mt (which is 20-7.4inferred)=(extra Taipan) + upto 30Mt (Gwardar)
+ POTENTIAL FOR TARGETS at Davidson Creek (for which they have provided no guidance / but an overall estimate figure)

TOTAL (Indicated + Stated Potential = 205Mt (*BUT NOTE* - I have not included any of the targets stated above that fall under the Davidson Creek project...note my comments above about placing a 25-30Mt potential on Gwardar and look at the other 6 targets in that area (which if it is assumed FRS hope for a 250Mt deposit....they are being VERY CONSERVATIVE in assigning (250-205) = 45Mt to these 6 good looking deposits at the Davidson Creek Project.

In saying that...IF each of those 6 deposits (results for 1 of those deposits is due to come in May'08 - still havent received news on it)...contains as much as the potential for Gwardar...i.e. 25-30Mt...then you are potentially looking at an additional 180Mt...to the 205Mt calculated above

Grace...I think that gives you 385Mt ..... you calculated 390Mt...

+ i have not included any tonnage for Mirrin Mirrin...


-------------------------------------------------------------------

YT, 

-for cash on hand, see the ann on 6th May, cash at June08 is forecast to be $20m + after the ann, include the proceeds from the 1-20 rights issue, i think thats another 15m? in their coffers...so they could have upto $35m cash by next month...
-for rail, projects are roughly 30km from Jimbelar Railway....and then its 1 stop to Port Headland i guess...but these guys are still trying to negotiate an agreement for rail and port access...


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## Spineli (22 May 2008)

_Just to clarify re_: Potential Fe @ *Davidson Creek project* ...I made an assumption above in my calculations of what the total Fe reserves would be if each of the 6 targets in Davidson Creek has a 30Mt potential...hence 180Mt

I got the 30Mt estimate for each of those targets from the ann on 1 April...

However, some have prior estimates from 24 April ann (which differ again from some of the estimates on the 23 April ann) - so while they keep changing their estimates...I have for my calculations above (used 30Mt for each of those targets):

- T40500E (no indication is given as to potential Fe)

- T42500E ("RESULTS EXPECTED IN MAY '08")...nothing yet and 1 week left in May! (40-50Mt potential as per 24 april ann)

- T46500E (5-10Mt potential as per 24 april ann)

- T48500E (15-20Mt potential as per 24 april ann)

- T51500E (no estimate given)

- T52000E (10-20Mt potential as per 24 april ann)

Taking the upper limited of these potential estimates and prescribing an estimate of 30Mt for the targets with no estimates (as per guidance in the April 1 ann for Davidson Creek)...

I still get a total (inferred + indicated + potential) resource of 
385 + 20 (additional for T42500E) - 20 (T46500E) - 10 (T48500E) - 10 (T52000E)

= 365Mt (not including any potential @ Mirrin Mirrin)


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## Spineli (24 May 2008)

New highs reached today! Up a cool 6% for the day taking the stock to $1.59 (see attached chart)

Some coverage for this stock @ miningnewspremium.net (miningnews.net) yesterday:

FerrAus boosts iron booty by 30% 

Thursday, 22 May 2008
Charlotte Dudley 

Excerpt which stood out - 

_"Mulling over the potential of the upgraded booty, FerrAus managing director David Turvey said the shape and size of the deposit would likely support a *production rate *of *“at least” 4 to 5 million tonnes per annum. *

The company had previously touted a 2 million tonne production target.
 "_

Last week in May coming up and hopefully we get some news on - T42500E ("*RESULTS EXPECTED IN MAY '08*")...(40-50Mt potential as per 24 april ann)


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## Atma (24 May 2008)

Hi all. My first post on Aussiestockforums. I am an iron ore believer. This has come to me as a good high grade iron ore. i believe grade, style is important. this has good iron. So far it has jorc of 53 mT with upcoming jorcs of 25mT @ Gwardar, and another 10mT upgraded at Robertson R.

Still 1 massive target to the left of Gwardar may turn out 40-50mT, and several exciting ones like Mirrin mirrin. Total , Maximum potential tonnage is about 250-350mT in my opinion from an analysis of gravity data.

Regarding transport, i have enquired with Ferraus investors relations and there are options

the options are:

1) Truck to bHP, state rail haulage agreement(as part of NWIO alliance)
2) Truck to BHP & mine gate sale
3) Build spur line to FMG(ala UMC) , open access - capex issue?
4) Truck to FMG, no capex but operating margin?
5) NWIO alliance have an own line built in the pilbara, maybe backed by state govt or chinese ala MMX/MIS?

regardless, FRS and other iron ore juniors have full WA state government backing. The govt is working its best to give them something.

Re: building spur lines. FRS will need atleast 200-250mT jorc'd for it to be economical/BFS/ financed or whatever


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## Spineli (26 May 2008)

Well thats 3 trading days in a row, this stock is up over 5% per day...

New highs today again, the order book is looking quite thin on the sell side.

I'm counting down the days till we get the upgrade at T42500E, results which were stated to be expected in May08. 40-50Mt target by their 24april ann.


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## Spineli (26 May 2008)

Well it kept its gain today. Closed 5% up after reaching an intra-day high of 1.75. The sell side is still looking very thin. *Still waiting for the May ann*


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## Atma (26 May 2008)

stock has turned out to be a winner. perhaps 50mT is quite a lot in iron ore. not many companies announcing high quality ore.


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## agro (26 May 2008)

Atma said:


> Hi all. My first post on Aussiestockforums. I am an iron ore believer. This has come to me as a good high grade iron ore. i believe grade, style is important. this has good iron. So far it has jorc of 53 mT with upcoming jorcs of 25mT @ Gwardar, and another 10mT upgraded at Robertson R.
> 
> Still 1 massive target to the left of Gwardar may turn out 40-50mT, and several exciting ones like Mirrin mirrin. Total , Maximum potential tonnage is about 250-350mT in my opinion from an analysis of gravity data.
> 
> ...




nice to meet a fellow iron ore believer  

FMG has the support of the smaller iron ore juniors within the Pilbra so chances are that provided FMG have another railway to up their production, companies like FRS will attain access..

Western Metals have a stake in FRS so funding shouldn't be an issue and i know BCI Iron have a MoU with FMG for rail use

cheers


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## michael_selway (26 May 2008)

agro said:


> nice to meet a fellow iron ore believer
> 
> FMG has the support of the smaller iron ore juniors within the Pilbra so chances are that provided FMG have another railway to up their production, companies like FRS will attain access..
> 
> ...




Hi not bad, but do you know whatthe expected mine life is at full produciton rate per annum?

*FRS - Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS -3.0 -1.6 -0.8 46.3 
DPS 0.0 0.0 0.0 0.0 *

thx

MS


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## Atma (26 May 2008)

if 4mT/a, RR orebody is 50mT, so mine life is over 10 yrs still. Obviously smaller targets will support lower mining rates.


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## grace (26 May 2008)

Atma said:


> if 4mT/a, RR orebody is 50mT, so mine life is over 10 yrs still. Obviously smaller targets will support lower mining rates.





If you look at posts above, the targets if added together come up to a sizeable number.  Close to 400 million tonne.  This company is usually conservative too so, it could go higher.  I don't think that this will be a small project!


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## Atma (26 May 2008)

grace said:


> If you look at posts above, the targets if added together come up to a sizeable number.  Close to 400 million tonne.  This company is usually conservative too so, it could go higher.  I don't think that this will be a small project!




yes you are right, its close to 350mT+. there is also manganese. and a tenement where no gravity survey was done. Considering the market capitalisation is only about $280m, this is dirt cheap.

As an example have a look at the following market caps:

MMX - 1.5bn
MIS - 1.6bn
AGO - 1.2bn

all three don't have anywhere near what Ferraus has. FRS current jorc is more than double AGO current jorc. Also Midwest iron ore is of poorer quality than Pilbara haematite primarily due to geological complexity.


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## grace (27 May 2008)

FRS has been on ABN Amro's buy list for a while, but they have now *upgraded their target from $1.68 to $2.28 *(thankyou very much!).

Here is a link to their report.

http://www.ferraus.com/files/catalog/080522_ABN_Amro_Morgans_Report.pdf

Well worth a read for holders and potential holders.  Cheers Grace.


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## Spineli (27 May 2008)

Up almost 5% again today! 4 days of consecutive ~+5% increases. 

About time it is given a re-rating! ABN Amro have stuck a *$2.28 price target *~36% increase.
Thanks Grace.

- Given a resource report is due soon for T42500E at Davidson Creek which could be in the vicinity of 40-50Mt, ABN Amro may have to go back to the drawing board soon...

On the point of infrastructure access:

"...advancing negotiations for infrastructure access. We expect
access can be resolved commercially, although the terms, structure and timing of an access agreement remain uncertain and will prove critical to the realisation of value."

The report concludes with a positive note on operational and resource risk.

"In the strong market for iron ore there will be cost pressures on development, and in the longer term the project will be exposed to iron ore prices and the A$ exchange rate. We see only *limited resource risk*, and *limited operational risk*"


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## michael_selway (27 May 2008)

Spineli said:


> Up almost 5% again today! 4 days of consecutive ~+5% increases.
> 
> About time it is given a re-rating! ABN Amro have stuck a *$2.28 price target *~36% increase.
> Thanks Grace.
> ...





Hm i read that report, yeah infrastructure access (rail & port) the main thing atm

*Earnings and Dividends Forecast (cents per share) 
2007 2008 2009 2010 
EPS -3.0 -1.4 -0.8 142.0 
DPS 0.0 0.0 0.0 0.0 *

thx

MS


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## Spineli (27 May 2008)

michael_selway said:


> Hm i read that report, yeah infrastructure access (rail & port) the main thing atm
> 
> *Earnings and Dividends Forecast (cents per share)
> 2007 2008 2009 2010
> ...




What is with posting EPS + DPS forecasts on each post of yours?

With your attachment, how would you justify the EV/Resource tonne being attributed to Brockman at the moment?? and what do you make of FRS's place on that chart?


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## grace (29 May 2008)

Nice announcement today, ahead of a May further resource announcement imminent.  New discovery called python (last one taipan.....snakes alive!).

Target start of 10mtpa now per announcement, with first mining planned for 2009.

http://aspect.comsec.com.au/asxdata/20080529/pdf/00846430.pdf


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## Spineli (29 May 2008)

Good ann today, the resource estimate came within expectations. Confirmation of a really good resource deposit with significant mineralisation occurring across good distance + thickness.

The week leading up to the ann:

Date 	Last  	% Change  	High  	Low  	Vol *
*29 May 2008* *1.900* +4.4%  	2.020  	1.800  	2,737,132
28 May 2008 	1.820 	+5.81% 	1.940 	1.730 	1,322,323
27 May 2008 	1.720 	+2.99% 	1.775 	1.690 	730,495
26 May 2008 	1.670 	+5.03% 	1.750 	1.580 	904,720
23 May 2008 	1.590 	+6% 	1.590 	1.475 	709,541
*22 May 2008 *	1.500 	+7.14% 	1.550 	*1.385* 	1,202,525

Next ann is due mid June

"Drilling results from gravity targets at T46500E and T48500E to the east of
the Taipan Resource are expected in mid June."

- From the Apr 24 Ann, : the following potential estimates were made:

- T46500E (5-10Mt potential as per 24 april ann)

- T48500E (15-20Mt potential as per 24 april ann)

* With a very good confirmation of resource today for Python......the upcoming mid-June resource ann could be named *RedBelly!*


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## Spineli (6 June 2008)

After reaching all time hights ~ $2/share about a week ago, FRS is down ~ 20% this week on no news. I think part of the build up was in anticipation of the ann on the 29 may. Perhaps some were hoping for a better result? I thought it was an excellent ann, further strengthened by David Turvey's (MD) comment, re: proposed production: “_This exciting discovery allows FerrAus to review its mine development plans toc onsider large scale production of up to 10 million tonnes per year_”.

Here is me hoping that my rights issue entitlement offer reaches Perth before Tuesday 5pm 

*Robertson Range*

For those who like the build up to drilling results, *Drilling results from gravity targets at T46500E and T48500E to the east of the Taipan Resource are expected in mid June.*.

- T46500E (5-10Mt potential as per 24 april ann)

- T48500E (15-20Mt potential as per 24 april ann)


*Also to look out for:*

*Robertson Range Iron Ore Project *- tenements south of the Main Zone:

Ann on 6th May says these targets have an exploration potential of 80-100Mt....*"First results by mid ‘08"* - hopefully some ann's soon regarding these target areas) 
- T55500E
- T56500E
- T59000E
- T59800E
- T91000N

See attachments for tenement maps/resource target areas/projects:


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## Spineli (7 June 2008)

Slight edit for my previous post: (first heading in Bold and Underline should read "Davidson Creek" not "Robertson Range")


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## grace (17 June 2008)

Well, looks like they have moved on from snakes!  New discoveries of tiger and dugite.  This project is sizing up nicely, and they are always conservative in their targets.  I have a personal target of 500million tonne of DSO on their project, going on what is coloured pink on their map, and what they have found from the pink already drilled (keeping it in simple terms).  



> *TWO NEW DISCOVERIES, EXTEND IRON MINERALISATION OVER 7 Kms**“Potential Production of 10-15 Million Tonnes per year will support Infrastructure Links*”
> 
> FerrAus Limited (ASX: ”FRS”) has made two additional discoveries of iron mineralisation at the Tiger and Dugite prospects within the Company’s
> Davidson Creek project in the East Pilbara region of Western Australia.




They are now calling Davidson Creek the monster deposit, and it is 30kms from jimblebar rail line.  Planned mining starts 2009.  New discoveries should get them over the line for conveyor belt to rail line.

http://imagesignal.comsec.com.au/asxdata/20080617/pdf/00851315.pdf


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## grace (8 July 2008)

This has come off the boil a lot recently.  High over $2, to $1.25.  Any news due Spineli?  Broke through $1.30 which wasn't very nice.


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## agro (8 July 2008)

so glad i sold my rights issue shares at 1.71 

too bad everything else is down though 

still not a bad stock


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## grace (9 July 2008)

Just to take your mind off the share price smashing over the last few days...here is some analysis from Ocean Equities on iron ore juniors.



> Additionally we believe Ferreus’s (“FRS”) deposits are very much dependant on gaining third party access to BHPB’s Jimblebar network to support development into production. FRS’s deposit is a typical example of a very attractive resource dependent on gaining appropriate infrastructure access to become economic and crystallise value, given the deposits remote location (at the end of BHPB’s railway line).
> 
> However, what we believe is in FRS’s favour is its premium product ore which could assist the Company agreeing some form of commercial agreement with BHPB.






> Given the improved margins offered from high grade, low impurity lump deposits relative to fines and the likely development of an increased divergence in pricing, we would expect investors to increasingly focus on the characteristics of the deposits held by the juniors.
> 
> We believe Atlas Iron (“AGO”) and Ferraus (“FRS”) are best positioned to benefit relative to their peers based on known resources and estimated lump-to-fines product mix.  FRS has commissioned mining and metallurgical studies which indicated a lump-to-fines ratio of 41:59, which is relatively high compared to other Marra Mamba deposits and a mining proposal and permitting for the Company’s flagship Robertson Range deposit are ongoing.






> FRS has highlighted a number of substantial high grade resource targets and offers investors significant exploration blue-sky potential relative to a number of its junior peers, albeit with significant exploration risk as a number of these targets have been inferred on gravity survey data and neighbouring resource size/grades only.
> 
> A key element to the development of the iron ore projects is FRS gaining appropriate access to infrastructure given the significant distances its prospects from Port Hedland. Therefore agreeing access to BHPB’s Newman/Jimblebar rail infrastructure is critical (even FMG’s rail network is 200km+ away). A key element which we believe is in FRS favour is that metallurgical studies to date have supported a favourable lump-to-fines ratio of 41-59% at its Robertson Range Marra Mamba deposit which enjoys a Fe grade of 58.9%.
> 
> The Company is currently investigating the following alternatives to develop it projects: 1. MGS; 2. transportation through a co-operative cost and profit share agreement; or 3. seeking access under the WA Government rail access regime. FRS is a foundation member of the North West Iron Ore Alliance.




http://www.minesite.com/fileadmin/c...n_Ore_Sector_Update_July08_Ocean_Equities.pdf


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## grace (22 July 2008)

Up a nice 12.39% today, which is the highest on my iron ore watchlist, apart from MGX who had 12.39% as well

Could there be some news on the way?


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## grace (31 July 2008)

grace said:


> Top 20 as at 28 September 07 = 69.06%  Lots of funds in there.




Top 20 shareholders per quartely just out at 71.63%.  Have not really checked who has sold or bought, but it slowly gets higher and higher with some big holders in there (wish I was one of them).


----------



## Spineli (10 September 2008)

*Ferraus Presentation* released to market just after close today.

Management appear to have upgraded 'Potential resource estimates for both the prospects at Davidson Creek and Robertson Range.

*Main points*:
-- *Potential for > 250-350Mt Fe -- (DSO Hematite) @ 57-60% Fe*
-- Davidson Creek -- 130 to 180 Mt Hematite DSO
-- Robertson Range -- 120 to 170 Mt Hematite DSO
-- Planned Production: 10-15Mtpa DSO
-- Infrastructure Access heading in the right direction - FRS has secured access with other members of the NWIOA for an initial berth allocation of 50Mtpa
-- Low Capex / Opex production (low strip ratios)

Announcements coming up :
-- Resource Upgrades due in Sept '08 (Davidson Creek and Robertson Range)
-- New Discoveries (Results Pending) - potential estimates yet to be given for T51500E (Davidson Creek) and T55500E (Robertson Range)
-- Enachedong Tenement (Manganese RC Drilling results pending - Sept '08)

Development Options
-- Mine Gate or Rail Head Ore Sales - RIO / IOH precedent
-- JV Production and Sales
-- Rail Haulage for Independent Ore Sales

Project Cases/Timetables
-- Fast track (2 to 5 Mtpa mid/late '10)
-- Mid size (10 Mtpa via Jimbelar & NWIOA Port in '12)
-- Large scale (15 to 25 Mtpa in '14)

Concept Case being developed for 15 to 25Mtpa production -- Pilbara East Alliance Rail Link 'PEARL'

Cash Position -- Approx $30M post WMC placement and rights issue 

Market Structure
ASX Listed Shares ~ 151.5m
Fully Diluted ~ 167.1m


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## grace (10 September 2008)

Are you still holding spineli?  Has been quiet on the iron ore junior threads.  I'm still holding, as I am still of the opinion that this one will get over the line to mining.   Share price of juniors have sure been beat up lately!


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## Spineli (10 September 2008)

Commodity prices have fallen recently. Iron ore and coking coal prices are the exception. Fundamentals remain strong. I happily hold and have accumulated at these levels. 

The company is coming along nicely. Resources will need to be proven to JORC standard and infrastructure plans further developed for a mid-size operation of ~10-15mtpa from ~2012.

Some results will filter through this month, but I'll be closely following port discussions for access. I'm happy with the fact that industry and the government in WA have been supportive of the NWIOA.


----------



## grace (4 October 2008)

Nice announcement this week - upgrade to 123.4MT @58.8%Fe  DSO.

Share price now 1/4 of what it was at the peak.  eeek!

My guess is they will get to 1/2 billion tonne of nice grade ore.  BHP is the closest major to FRS.



> LARGE, NEW IRON ORE RESOURCE
> at the DAVIDSON CREEK PROJECT
> - supports development of mine, rail & port.
> 
> ...


----------



## grace (22 October 2008)

Australian Enterprise Holdings just bought 5.78% of FRS at a price of 90cents.  What do you know.....only trading at 24cents (announcement after market close).

Glad someone sees value in it!  We might have a green day tomorrow seeing it is only trading at 26% of this recent transaction!

Becoming very very illiquid this one!

167.1 million shares @ 24cents = $40 million mc  (25mill cash)

123.4 mill tonne @ 58.8 fe (and growing to 500 million tonne imo)

$15 mill for all of those projects.  Glad it's tightly held so noone else can get their hands on it at these prices!

investor presentation......

http://imagesignal.comsec.com.au/asxdata/20081021/pdf/00892831.pdf


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## grace (4 December 2008)

grace said:


> Australian Enterprise Holdings just bought 5.78% of FRS at a price of 90cents.  What do you know.....only trading at 24cents (announcement after market close).
> 
> Glad someone sees value in it!  We might have a green day tomorrow seeing it is only trading at 26% of this recent transaction!
> 
> ...




As the share price sinks, and it seems noone holds except me.....a nice announcement out after market close today.

150 mill tonne DSO at 58.7Fe  (resource upgrade)

As I say, I think they'll make it to 1/2 billion tonne of DSO.

BHP's rail line is not that far away.  FRS have a nice deposit.  Let's see what happens now that the RIO deal is dead.

http://imagesignal.comsec.com.au/asxdata/20081204/pdf/00911038.pdf



> Total resources for FerrAus’ East Pilbara Projects
> 150.1Mt @ 58.7% Fe
> Gwardar & Python 85.7 Million Tonnes @ 58.7% Fe
> Taipan 14.6 Million Tonnes @ 57.7% Fe
> ...




“FerrAus is mindful of difficult conditions in the global financial markets and has taken appropriate measures to maintain our strong balance sheet. Our key shareholders, Penfold Limited and China Western Mining, provide FerrAus with a unique insight to markets and economic activity in the global iron and steel industry. We remain confident that high quality projects will attract investment partners and secure the necessary funding for project development.”


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## happytown (3 June 2009)

ann out this morning regarding an increase in direct shipping ore



> ...
> 
> The total iron ore resource inventory for FerrAus’ licence areas in the East Pilbara has increased to *166.6 million tonnes grading 58.6% Fe*
> Resources at the Davidson Creek project have increased to 114.4Mt @ 58.4% Fe including
> ...



potential to increase resource to 3-400M t

sp currently up approx 14% on above average volume

cheers


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## grace (3 June 2009)

happytown said:


> ann out this morning regarding an increase in direct shipping ore
> 
> potential to increase resource to 3-400M t
> 
> ...




Market cap $42mill fully diluted at 25c per share.  166.6mt of DSO.  We've got about the same issued shares as tonne of DSO.  So for every one share, you get 1 tonne of DSO.  This is the only iron ore stock I have hung onto because I've always thought it is undervalued compared to other iron ore juniors.  So your 27 cent share gets you 1 tonne of DSO in the ground.  Would be interested to compare this to other juniors but it's something I haven't run the ruler over for a while.


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## wallyscot (14 June 2009)

Have a small interest in FRS, and noticed the jump in sp from 28.5c to the current 53.0c close over the past 10 days or so, and on what appears a not insignificant rise in volume of shares traded.

Being a "Sad Scotsman" , any local investors heard anything to warrant the rise ? Can the rise be expained solely by the 3rd June resources increase ?

wallyscot


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## grace (18 June 2009)

wallyscot said:


> Have a small interest in FRS, and noticed the jump in sp from 28.5c to the current 53.0c close over the past 10 days or so, and on what appears a not insignificant rise in volume of shares traded.
> 
> Being a "Sad Scotsman" , any local investors heard anything to warrant the rise ? Can the rise be expained solely by the 3rd June resources increase ?
> 
> wallyscot




Hello Scotsman, I hope you are not feeling as sad today.
Well, like all iron ore juniors, this one has had a nice run over the last couple of weeks because of the rio/bhp jv and the thought of who the chinese will move on next.
However, this one has continued to have good volume today, when others' have dropped back.  I'm a bit suspicous....   I don't know who is doing all of that buying - volume was very large.


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## Sean K (19 June 2009)

This looks to be the cheapest junior on my cheap junior scale coming in at a lowly 41c per tn DSO, followed by GWR on 46c, and then GIR at 66c. Then, it's daylight to the rest well over $1.00. 

Why is this one so cheap? Under the radar? Not going to get the capex or access to infrastructure? Crap management?


ABN review last Oct:

Investment view
FRS’s tenements contain a high-quality iron ore resource. We anticipate access to rail
infrastructure can be resolved commercially, but the terms, structure and timing of an agreement
remain uncertain and will prove critical to the realisation of value. As part of the North West Iron
Ore Alliance FRS has an option to secure access to multi-user port capacity, and will need to meet
the progress payments scheduled by the Port Hedland Port Authority. With the potential for a
further major increase in the resource base, FRS is now evaluating options for a stand-alone iron
ore mine with its own rail line. With the scale of operations and the funding structure uncertain, we
retain our valuation of A$2.68 per share based on naÃ¯ve modelling.


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## grace (21 June 2009)

kennas said:


> This looks to be the cheapest junior on my cheap junior scale coming in at a lowly 41c per tn DSO, followed by GWR on 46c, and then GIR at 66c. Then, it's daylight to the rest well over $1.00.
> 
> Why is this one so cheap? Under the radar? Not going to get the capex or access to infrastructure? Crap management?
> 
> ...




I don't know why it trades at a discount to the rest.  Mgt seem to have good connections with the iron ore alliance.  At least those juniors are working on some infrastructure.  FRS have never dissapointed the market to date.  The share registry is fairly tightly held, so a bit of volume can lead to volatility (especially when everyone is selling at the same time).  Their drilling has been of nice consistency.  A rail line would do wonders for the share price of cause.  I usually chat to myself here because it is so illiquid.


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## pops11 (22 June 2009)

grace your not alone i too like this Co find that brkers have it at a buy strongly so its interesting to say the least why it is so cheap???


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## Sean K (25 June 2009)

FRS in the OZ.

Comes in 3rd on my price per mt DSO basic analysis.


*FerrAus joins junior miner merger hunt*
Sarah-Jane Tasker | June 25, 2009 

EMERGING East Pilbara iron ore hopeful FerrAus has added its name to the growing list of juniors targeting consolidation in the sector to unlock infrastructure and provide an alternative source for China.

The South Australian-based explorer announced yesterday it was restarting iron ore exploration, adding that its objective was to promote the consolidation of the junior sector in the Eastern Pilbara. 

Its shares received a boost on the back of the news, jumping 4.44 per cent to 47c. 

The announcement by FerrAus comes less than a week after neighbouring juniors Warwick Resources and Hannans Reward merged their iron ore tenements. 

Warwick, which is 20.88 per cent owned by Atlas Iron, purchased Hannans Reward's East Pilbara iron ore tenements for $5.25 million in a move tipped to extend Atlas's reach across the sector. 

Both Warwick and Hannans said further consolidation in the region was expected because most juniors would struggle to access infrastructure without adding tonnages to their projected output. 

FerrAus chairman John Nvylt agreed further consolidation in the sector was needed to create a sufficient resource base to underwrite the construction of connecting infrastructure.


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## Sean K (26 June 2009)

And while looking cheap to the peers, is in a pretty good set up here. On a break up, the technical target is the length of the pole. Just a probability of course.


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## Sean K (4 July 2009)

kennas said:


> And while looking cheap to the peers, is in a pretty good set up here. On a break up, the technical target is the length of the pole. Just a probability of course.



Keep an eye on this formation. Can't see it making the target as the fundamentals would probably be well overextended by then, but nice formation at the moment. Overall market sentiment probably won't help it's chances.


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## Amor_Fati (4 July 2009)

I have nothing to offer on the technicals but fundamentally the big news today was the appointment of Mike Amundsen who worked for BHP for 28 years including roles as vice-president of business development in iron ore. The statement they put out today reiterated the sense that consolidation makes for some of these juniors. I think his experience could be helpful in making the deals FRS needs. Particularly with access to BHPs railway line, I think he would know a few people.

I bought in today as I've been looking at it for a while. I knew it had the resource and is well placed financially and I think this could be a catalyst for future action.

Kennas, thanks for that IO junior thread. I found it very helpful to start from. I now own a few BRM as well, I think the size of their resource and chinese accumulation bodes well for the future.


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## Sean K (6 August 2009)

Looks to be breaking up.

Probably associated with the news on China sniffing about in the papers.


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## Sean K (7 September 2009)

Trading halt regarding a 'significant strategic agreement with a large-scale Chinese state-owned enterprise.'

Read: we are going to give away half our company for a offtake agreement.

lol

Should be good for them I imagine.

Wonder if the other infrastructure partners will get a boost.


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## grace (7 September 2009)

kennas said:


> Trading halt regarding a 'significant strategic agreement with a large-scale Chinese state-owned enterprise.'
> 
> Read: we are going to give away half our company for a offtake agreement.
> 
> ...




Wondering also about UMC and RMC this morning as well.  Bugger, I sold all of my UMC.  Still holding all of my FRS though.  That was lucky....


----------



## grace (17 September 2009)

Still holding this as my only iron ore junior (oh, I still own some DMM, and nearly back to break-even there.)
Breakup today, but buyers got a bit afraid.  Had a good run though.  Pity I didn't keep GIR and BRM - could have made some more dollars - oh well.  Still cashed up if the opportunity arises....


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## matty2.0 (22 September 2009)

mate the juniors are all exploratory and don't have any contracts with steel producers. 
pure speculation on take-out w/ re to recent run-up.


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## eddyeagle (9 October 2009)

Ferraus has had a good run in the last few sessions - up 28% in 4 days on the back of no news! Got to love the volatility of these small caps!


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## grace (13 October 2009)

Some nice news coming in today (a new formation found to the east-6km strike length).  Nice to go east because that is where the rail line ends.
Goal of 230 mill tonne of DSO by mid 2010.  These guys never disappoint the market with their high grade iron ore.  I don't doubt them one bit.  A bit of buying coming in with UMC in TH.....  It would be nice to break up from here.


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## grace (13 October 2009)

eddyeagle said:


> Ferraus has had a good run in the last few sessions - up 28% in 4 days on the back of no news! Got to love the volatility of these small caps!




I only just saw your post.  Was it a leaky boat prior to announcement today, or the speculation going on in iron ore juniors with UMC in trading halt?  I guess we will never know.


----------



## grace (18 October 2009)

grace said:


> Some nice news coming in today (a new formation found to the east-6km strike length).  Nice to go east because that is where the rail line ends.
> Goal of 230 mill tonne of DSO by mid 2010.  These guys never disappoint the market with their high grade iron ore.  I don't doubt them one bit.  A bit of buying coming in with UMC in TH.....  It would be nice to break up from here.




Sorry about the directions, can't work out my east from west living on the other side of the country.  As FRS are in West Oz, the deposit is to the West.  That is where the rail line ends at Jimblebar (to the West), so it is the closest deposit so far.  Could be within 20kms now from rail end.  This will be the first deposit mined if it all goes sweet IMO.


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## eddyeagle (12 January 2010)

Ferraus has been flying the last two days with a big increase in volume. Hit 89c at one stage today! Has had an excellent 6 weeks!  Anyone got any clues why?

ps. I love it when my stocks get speeding tickets


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## eddyeagle (15 January 2010)

So - Announcement out yesterday:

- Drill results confirm discovery of substantial iron mineralisation
- Significant intercepts of up to 76m @ 60.3% Fe
- Additional potential for detrital ore
- Maiden resource expected to be confirmed during first quarter 

Share price jumped 12%!

I find it quite amusing that the share price started running 3 days before the announcement, and then also that the company claimed they had no knowledge of why it might be rising etc.


----------



## Sean K (15 January 2010)

Probably because of IO prices and this:

14 Jan

*RESULTS CONFIRM MIRRIN MIRRIN AS NEW DISCOVERY*

FerrAus Limited (ASX: FRS) is pleased to announce further exploration success at its East Pilbara exploration project, continuing the flow of high grade Direct Shipping Ore (DSO) results from its Davidson Creek area.
The Mirrin Mirrin Prospect is located two kilometres north west from Python Resource and is the closest of the FerrAus prospects to the Jimblebar rail head (approximately 30 kilometres to the west).

Best results include the following intersections:

DCRC0622 56 metres @ 59.3 per cent Fe
DCRC0650 60 metres @ 58 per cent Fe
DCRC0651 76 metres @ 60.3 per cent Fe
DCRC0661A 54 metres @ 59.4 per cent Fe
DCRC0663 48 metres @ 60.2 per cent Fe

The initial identification of the Mirrin Mirrin mineralised trend was announced in August 2009 after an 18 hole drill program. A further 39 RC drill holes, completed towards the end of 2009 for a total of 5,556 metres, outlined iron mineralisation over a strike length of 800m.

Managing Director, Mike Amundsen, said this new resource, together with updated results from other areas drilled in the fourth quarter of 2009, is expected to be announced during the next month.

“We are seeing a rebound in iron ore demand and spot prices, as well as strong customer interest and support in new emerging projects with substantive resources,” he said. 

“In recent months we have received visits from major Asian steel mills expressing interest in FerrAus.

“We have already identified more than 166 million tonnes* in total resources, concentrated within a 20 kilometre radius and have just commenced an aggressive drilling program for 2010,” Mr Amundsen said.

The Mirrin Mirrin Prospect has a mineralised trend of some three kilometres strike extent and is still open to the east, west and down dip. This drilling also intersected zones of detrital ore, which have not been closed off.
Results from this drilling program, covering approximately one third of the total Mirrin Mirrin mineralisation trend, will form the basis for a maiden resource. Further drilling on the remainder of the Mirrin Mirrin trend is planned for the second quarter of 2010.

Drillhole locations and assay results from the above project is presented in Figure 1 and a summary of the results listed in Table 1, below.

* 166.6 million tonnes (23.8 million tonnes – Measured, 43.2 million tonnes - Indicated, 99.6 million tonnes - Inferred). Resource estimates are in accordance with AusIMM JORC Code 2004 reported in ASX announcement 3/6/2009

This has been flying under the radar for some time on a comparitive basis and is still trading at just 79c a ton DSO. 

GIR at 1.09
SDL 1.30
BCI 1.32
IOH 3.17

And BHP takeover of whatsitsname done at $1.20.

With these results and likely addition to DSO tonnage down the track it will only become cheaper, unless the sp appreciates as it should. 

Major break up in June on vulume was the start of the climb. Resistance accross 90c but the fundamentals say higher.


----------



## grace (16 January 2010)

Well, this was the only iron ore junior I hung onto.  I ditched BRM, GIR and UMC.  One certain thing I have learnt, you can not always get it right.

Anyways, this deposit is shaping up nicely and I think they will get to their 500 million tonne of DSO eventually.  Got to be worth a bit to someone seeing it's not far from the rail end.


----------



## Sean K (17 January 2010)

grace said:


> Well, this was the only iron ore junior I hung onto.  I ditched BRM, GIR and UMC.  One certain thing I have learnt, you can not always get it right.
> 
> Anyways, this deposit is shaping up nicely and I think they will get to their 500 million tonne of DSO eventually.  Got to be worth a bit to someone seeing it's not far from the rail end.



I reckon you would have done quite nicely out of those three Grace.  Nothing wrong with leaving some on the table for the next person to pick up and run with for a bit. Well done on holding FRS, looks great to me. If the markets continue to generally behave then this will naturally keep appreciating as the raw figures show on the spreadsheet - undervalued still. Good luck!


----------



## grace (2 March 2010)

Still in a nice uptrend from March 09 it seems.  Looks to be an attempt to go higher here.  Nice volume today.  I'm still holding this one.

Recent news could be adding to the momentum....



> FERRAUS MOVES TO PRE-FEASIBILITY AFTER SCOPING STUDY INDICATES POTENTIAL A$1.1 BILLION NPV
> FerrAus Limited (ASX:FRS) today outlined a robust development evaluation for its iron ore project in the Pilbara Region, *located some 35km east of BHP Billiton’s Jimblebar Mine *in Western Australia, with the completion of a positive Scoping Study that indicates a potential A$1.1 billion Net Present Value (NPV) for a project ramping up to 15Mtpa.




Well, there you go.  I didn't even know there was a mine at Jimblebar.  I guess that could be the reason why the rail line ends there.

Anyway, as always, this one never disappoints the market with news.


----------



## roland (3 March 2010)

FRS quite buoyant at the moment - not a lot of volume, but has it's exciting moments 

Looking for a little more volume tomorrow as I see it has hit an entry level on one of the advisories I subscribe to - let's see what tomorrow brings.


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## roland (4 March 2010)

Aha! - 66% increase in reserves 

Nice little eye opener for this morning. The insiders knew already.

FRS looks like it will be going places.


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## Sean K (16 August 2010)

WOW, DSO resource recently upgraded to 315Mt. That's a decent number!

Trading at 35c a ton.

That can't be right, I must have missed a capital raising or something.

Should be trading at over $1.00 a ton really.

Hmmm


----------



## grace (2 September 2010)

kennas said:


> WOW, DSO resource recently upgraded to 315Mt. That's a decent number!
> 
> Trading at 35c a ton.
> 
> ...




Haven't got time to check the exact figures, but it is still significantly undervalued and always has been, and I'm not really sure why.  It is a decent deposit and I'm confident it will make it to 1/2 billion tonne of DSO.  Great position near the rail line too and next to BHP's mine.


----------



## grace (10 November 2010)

grace said:


> Haven't got time to check the exact figures, but it is still significantly undervalued and always has been, and I'm not really sure why.  It is a decent deposit and I'm confident it will make it to 1/2 billion tonne of DSO.  Great position near the rail line too and next to BHP's mine.




Much has been said from me about this one lagging the rest of the iron ore sector so I shoud do some figures to support this.

*FRS have a Manganese and Gold deposit which are forming up nicely but I will value those at nil for this exercise.*Cash $22mill.

316 mill tonne of 50-55% Fe

210 mill tonne of the above is avge 58.5%

All DSO (correct me if I'm wrong)

Shares on issue 210 mill
Options to be converted 7.5mill (that will bring in some cash too)

Total fully diluted 217.5 mill shares
@ 82.5c 
Market cap = $179mill
less cash of $20mill
MC = $159mill for iron ore, manganese and gold 

*So just attributing value to iron ore
$160mill / 316mill tonne
= 50c per tonne of DSO*

This has got to be one of the cheapest around at the moment surely.
It is a great position not far from the rail line and BHP's Jimblebar Mine.  It has some Asian interest  Wah Nam at 19.9% and China Rail at 12.61%.

It is part of the Alliance with Brockman etc etc.

I just don't understand why this is lagging at the moment.
Can someone tell me?  Recent drilling not yet in certified resources has been brilliant as usual.


----------



## jonojpsg (10 November 2010)

grace said:


> Much has been said from me about this one lagging the rest of the iron ore sector so I shoud do some figures to support this.
> 
> *FRS have a Manganese and Gold deposit which are forming up nicely but I will value those at nil for this exercise.*Cash $22mill.
> 
> ...




Perhaps the grade is lacking compared to others - 58%+ is fair but the rest would possibly need upgrading??  Not sure - plenty of other DSO IO out there at 60+% which may be making this less attractive?  WHo knows, just thoughts...


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## Sean K (10 November 2010)

Just undervalued on a comparative basis I think and should have it's day all else being equal.


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## YELNATS (10 November 2010)

grace said:


> This has got to be one of the cheapest around at the moment surely.
> It is a great position not far from the rail line and BHP's Jimblebar Mine.  It has some Asian interest  Wah Nam at 19.9% and China Rail at 12.61%.
> 
> It is part of the Alliance with Brockman etc etc.
> ...




Hey Grace, thanks for the analysis. 

If I'm permitted to ask, would you like to include an opinion at what you think share price it could/should be trading at, comparing it to say BRM which hit $4.80 today?


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## basilio (10 November 2010)

> This has got to be one of the cheapest around at the moment surely.
> It is a great position not far from the rail line and BHP's Jimblebar Mine. It has some Asian interest Wah Nam at 19.9% and China Rail at 12.61%.
> 
> It is part of the Alliance with Brockman etc etc.
> ...




Your analysis has almost always been spot on Grace. I think you are just ahead of the curve. 

The question is why havn't the professional analysts also crunched the numbers with the same result?


----------



## happytown (11 November 2010)

grace said:


> ...
> 
> *FRS have a Manganese and Gold deposit which are forming up nicely but I will value those at nil for this exercise.*




noted that you are valuing them at nil

however

re a gold deposit, can you provide details of the jorc resource (only gold project with FRS located sofar was spun out into LSN and FRS hold less than 10% of shares in LSN - 1.5M of 24.9M shares as of FRS' sep qrtly rep)

as to a manganese deposit, can you provide details of the jorc resource

from their 2009 ann rep they indicated intersections at Enachedong were uneconomical and since then they have only gotten rock chip samples (up to 57.6% Mn) - observations of Mn explorers show good rock chip samples rarely equate to hi-grade drill intersections (ie 40% + for Mn)

initial search cannot locate jorc resources, ie deposits for Au and Mn for FRS, and as mentioned above the Au was spun-off into LSN, can you assist in providing details of the jorc resources for these deposits you mentioned


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## happytown (11 November 2010)

wah nam is on the hunt

subsequent to their t/o offer for brm this morning they have just launched a t/o offer for frs

6 wah nam shares for every frs share (they are offering brm 30 wah nam shares per brm share)


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## adobee (11 November 2010)

the annoucement states this is equivalent to $1.30
with this in mind why are people selling at $1.05


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## YELNATS (11 November 2010)

adobee said:


> the annoucement states this is equivalent to $1.30
> with this in mind why are people selling at $1.05




For the same reason BRM is currently selling at $5.70 or less when the Wah Nam offer is valued at $6.47.

"A bird in the hand...."


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## Sean K (11 November 2010)

Wah Nam might have come off a bit, thus reducing the value of the initial offer. Just a guess.

Was only a matter of time before these got snapped up.


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## YELNATS (11 November 2010)

kennas said:


> Wah Nam might have come off a bit, thus reducing the value of the initial offer. Just a guess.
> 
> Was only a matter of time before these got snapped up.




You would think so, but Wah Nam are currently up more than 12% today in Hong Kong, thus now valuing their offer at $1.46 for FRS and $7.29 for BRM, using the 7.82 exchange rate quoted in Wah Nam's offer letter.


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## grace (11 November 2010)

happytown said:


> noted that you are valuing them at nil
> 
> however
> 
> ...




Yes happytown, no jorc yet.  Sorry, my focus was on the iron ore and thus I put no value on anything else as I didn't have time to scrutinise.

Can't believe I was only thinking to myself yesterday how I should buy more of those.  Might still.


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## JTLP (11 November 2010)

YELNATS said:


> You would think so, but Wah Nam are currently up more than 12% today in Hong Kong, thus now valuing their offer at $1.46 for FRS and $7.29 for BRM, using the 7.82 exchange rate quoted in Wah Nam's offer letter.




They're not getting valued at those prices because who wants shares in Wah Nam? It's just a scrip bid - if they offered cash it would be at or above those prices.


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## grace (11 November 2010)

JTLP said:


> They're not getting valued at those prices because who wants shares in Wah Nam? It's just a scrip bid - if they offered cash it would be at or above those prices.




Wah Nam will co list on the ASX if bid is successful per the fine print.  Who are Wah Nam?  I don't know much about them.  I agree that they will be able to raise money better than over here.  However, it is a low ball offer to get some good quality ore.  I wonder if someone else might be interested?  BHP have a few $$ up their sleeve.  FRS and BRM are well positioned next to their own rail lines.  There is certainly some scope for BHP to be interested.  They did take out UMC as I recall.  Let's see what the next week brings.


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## shinobi346 (12 November 2010)

JTLP said:


> They're not getting valued at those prices because who wants shares in Wah Nam? It's just a scrip bid - if they offered cash it would be at or above those prices.




Agreed. I'd rather take the money thanks than take shares in a foreign company I dont know. They may be thinking too that the US$ is gonna drop more/AUD rise more so they thought they better jump in now before it gets expensiver.


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## prawn_86 (12 November 2010)

I highly doubt BHP will make a bid. They are too big a company to be able to do a quick analysis and launch a counter offer. Look at all the due diligence etc that has gone into their other attempts.


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## grace (12 November 2010)

prawn_86 said:


> I highly doubt BHP will make a bid. They are too big a company to be able to do a quick analysis and launch a counter offer. Look at all the due diligence etc that has gone into their other attempts.




Sorry prawn, I'm going to have to disagree with you here.  It is BHP's job to watch all share movements in any iron or junior in the Pilbara.

BHP kept China Rail out on UMC last time.  Link below.  Every chance they will do anything they can again to keep the Asian interest out.

http://news.ninemsn.com.au/article.aspx?id=876712


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## basilio (12 November 2010)

> Sorry prawn, I'm going to have to disagree with you here. It is BHP's job to watch all share movements in any iron or junior in the Pilbara.
> 
> BHP kept China Rail out on UMC last time. Link below. Every chance they will do anything they can again to keep the Asian interest out.  *Grace*




BHP's interest is in keeping as much control of iron ore sales as possible. In effect a monopoly. Buying out other potential suppliers or restricting their capacity to reach the marketplace will be part of their strategy to keep up prices and volume. 

Can't see them letting Wah Nam get away with this proposal lightly.


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## adobee (12 November 2010)

Wah Nam seems to be a limo company going into mining ..
They will need cap raising to pay for the take over ..
Majorority of there other money is in shares in these companies already..
I dont think it will happen.. but it may have made there current holdings worth a bit more..


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## grace (15 November 2010)

About time the Directors got that PFS and resource upgrade out.  I can't see shareholders agreeing to this takeover offer at all.  There is some value in that iron in the ground.

*



• PFS confirms Project is financially robust and technically viable
● Key estimates from the PFS are:
● NPV8 Range from A$1,120 to A$1,340 million
● IRR Range from 24 to 26 per cent
● Significant opportunities to further enhance value
● Board approves commencement of Definitive Feasibility Study

Click to expand...


*


> The PFS is based upon the following key parameters:
> - life of mine production was assessed to be 227Mt (wet);
> - *the final product grade is approximately 59% Fe*, 2.3% Al2O3, 4% SiO2, 0.09% P,
> 8.3% LOI;
> ...






> ● Maiden Iron Ore Reserve of 126 million tonnes
> ● 23% increase in + 55% Fe Mirrin Mirrin resource; now 37.9 Mt
> ●* Current Resource Total = 328.7 Mt *Corporate Objective = 400 Mt




And on the transport front...

*



			FerrAus Limited advises that it has today requested BHP Billiton Iron Ore, which is
representing the Mount Newman Participants (BHP Billiton Minerals Pty Ltd, Mitsui-Itochu
Iron Pty Ltd and ITOCHU Minerals & Energy of Australia Pty Ltd) to agree by 5pm WST,
Tuesday 16 November 2010, to the appointment of Professor Allan Fels AO as the
independent expert to determine the final terms and conditions of a binding rail haulage
agreement for the carriage of FerrAus’ iron ore on the Mount Newman railway system.
		
Click to expand...


*


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## mr. jeff (24 November 2010)

Hello all FRS followers,

anyone been watching the chart lately? Looks like a picture book triangle at the moment, any Technical people out there who might have a clue which way it will break?! I guess it will depend on whether there is further news flow, but interested in any opinions...


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## shinobi346 (29 November 2010)

They, like BRM, just told the limosine company to take a hike so we will probably see it fall a bit from here.


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## mr. jeff (16 December 2010)

Have had a look into the bid ( received formal bid stmt. today ) and it stacks up like this:

6 Wah Nam shares per 1 FRS.

at current price of Wah Nam  sp = 1.64 HKD, (code on HKex is 159)

 6 x 1.64 / 7.6 (HK$'s per AUD$1)

gives you $1.29 for FRS shares which currently sit at $ 0.97. sounds great put like this. The reality is a little different it seems, an all scrip bid that went down like a lead balloon.

Interested to see what FRS comes up with next.


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## shinobi346 (11 January 2011)

Takeover offer extended to the 16th of Feb. No surprises here.


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## mysteriousbrad (14 February 2011)

So whats going on with the WNI takeover bid... are they just wasting their time?? Extended til the 15th of March now.


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## mysteriousbrad (11 May 2011)

What are peoples thoughts on WNI dropping the Acceptance condition and FRS's reply??
Seems like BRM is very close to the new 50% threshold.


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## YELNATS (11 May 2011)

mysteriousbrad said:


> What are peoples thoughts on WNI dropping the Acceptance condition and FRS's reply??
> Seems like BRM is very close to the new 50% threshold.




Please refer to the last few entries on the BRM thread.


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## mysteriousbrad (27 June 2011)

Well this is interesting... Atlas (AGO) take over bid for FRS???


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## adobee (27 June 2011)

they go well together and increase the amount of port access etc  available. ..
AGO is a quality operation..
Question is will the chinese increase their bid or go for something else..


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## mysteriousbrad (28 June 2011)

adobee said:


> Question is will the chinese increase their bid or go for something else..




WNI has announced their offer will finish on July 15th! Looks like they are off after something else!


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## shinobi346 (21 September 2011)

Looks like wham bam no thanks mam have conceded defeat and helped AGO cross the 90% line. AGO is now free to compulsorily aquire the remainder of FRS. No objections from me here.


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