BRM - Brockman Resources

[Sean K]

UH OH..........broken down through $1.10.
This doesn't look good for BRM holders
Next stop $1 imo.

I agree, there's more support at $1.00 but $1.10 was obviously important. Will be interesting to see how she goes.

What was the cash backing? 80c?

If it gets back to those levels with all that potential money in the ground, could be a good opportunity. Again.

 

[kpas]

I agree, there's more support at $1.00 but $1.10 was obviously important. Will be interesting to see how she goes.

What was the cash backing? 80c?

If it gets back to those levels with all that potential money in the ground, could be a good opportunity. Again.

From memory it was about 83c or so, but also from memory I recall the $ in the bank going up from being invested at a reasonably good rate with little outgoings for the last quarter.

Although some options got pushed through the other day, so it's probably 82 or thereabouts.

Sad to see it down because of no news from management on progress. I have been following this stock for the best part of 2 years and starting to get impatient with lack of news and them missing their deadlines.

 

[Go Nuke]

Ah BRM's been long forgotten I see.....except for Kennas

People speculating about a chinese buying into another IO junior after the RIO/BHP deal.

imo, if it can hold this trendline then today signaled a buy anyway.

 

[Sean K]

Ah BRM's been long forgotten I see.....except for Kennas

People speculating about a chinese buying into another IO junior after the RIO/BHP deal.

imo, if it can hold this trendline then today signaled a buy anyway.

Lots of IO juniors have gone for a run, all way off their lows. Was a great opportunity earlier in the year. Harry is slapping me in the back of the head saying 'why didn't you buy more you goose!'. Oh well.

Held $1.00 nicely which was a good sign. Now needs to tackle this $1.30 ish resistance. Looks pretty positive with the market just pushing and pushing. US going well at the moment so may be a chance.

You'd expect BRM to be involved in future M&A activity, one way or the other. Surprised they've lasted this long.

 

[Sean K]

AGO is flying while BRM is lagging a little. Or is it?

AGO
300m @ $2.00 = $600m mc.
$67m cash
60m tn DSO
2b tn Mag around 36%
Target production 6mt in 2010 and 12 mt in 2012
Producing
Great location, excellent exploration potential

BRM
135m @ 1.34 = $180m mc
$100m cash
68m tn DSO
1.4b tn Mag around 43%
Targetting 15mt in 2012 and 25mt in 2015
BHP line runs through their bathrooms. RIO and FMG a stones throw.

One is either overpriced or the other underpriced.

 

[shag]

i think its partly because one has iron in its name. no bull.
brm has lots of better ore doesnt it, hermatite?
aus is too small too, too many people with friends.
ive had both, hold none presently as need cash.
maybe atlas is a good story/example for brm, once word and momentum take hold.

 

[Go Nuke]

Hasn't AGO already got take off agreements?

I think thats what i heard the other day. BRM doesn't have that yet does it?

Might slip in under the radar.
Another one of those smaller Chinese Iron mobs.

Maybe that guy who tried a bid for CFE might come back for another go...

 

[justiceotp]

I hold both AGO and BRM. Yes AGO has agreements in place BRM is a little behind them in the production time line but has stated in previous announcements its been in early negotiations. I'm expecting similar results out of both just BRM to be lagging behind AGO in time but only because AGO is already selling product and BRM is yet to and I am planning to hold both very long term at this stage. I have AGO at ave buy of $0.77 and BRM ave buy of $0.84.

 

[justiceotp]

Kennas to add to your comments on pricing, In both ago and brm threads I have posted links to broker valuations of the two companies and from memory someone had AGO @ $4.00 Target and someone else BRM at $16.00 Target, these where a while back so values would have changed with the market but the ratio of the two should still be similar.

 

[Sean K]

Crikey, Wah Nam International have creaped up the registry fast. Now holding 11.3%. Anyone want to speculate what this could mean?

 

[JTLP]

Crikey, Wah Nam International have creaped up the registry fast. Now holding 11.3%. Anyone want to speculate what this could mean?

Most likely with this mob nothing...unless WR has finally given the go ahead to somebody but kept it on the down low??? (remember all those wonderful MOU's in the wings... )

Could also be a blocking stake they are building? Or potential for the order book?

I hold

 

[Sean K]

Wham Bam have now increased their stake to 13.44%. Something might be in the pot, and on the boil. Or maybe not. Maybe they just like buying shares.

 

[JTLP]

Wham Bam have now increased their stake to 13.44%. Something might be in the pot, and on the boil. Or maybe not. Maybe they just like buying shares.

LOL. "Maybe they just like buying shares" - solid chuckle!

I made mention that perhaps WR's MOU's are coming into fruition...who knows really? TBH it's nice that somebody is taking an interest in this co...maybe this is a prelude to rail deals + benefications?

Actually, I think the benefication was quite a massive ramp. Has there been any ann's on this yet? (My apologies if yes). If no, then ASIC really need to look into it...if this was a crock wouldn't it substantially change there figures and material that could be processed?

I'm still very critical about BRM and their operations. Management don't exude confidence and the train really doesn't seem to be leaving the station...maybe they will make me eat my words...

 

[Sean K]

PFS due in June 09.

That's today!

They'll then have to put a covering letter on it, so expect the announcement sometime in 2010.

Ann 3 Dec 08

MARILLANA PROJECT DEVELOPMENT UPDATE

BROCKMAN AWARDS STAGE 2 PRE-FEASIBILITY STUDY TO AUSENCO

Western Australian Iron Ore Company, Brockman Resources Ltd (ASX Code: BRM), is pleased to announce the signing of a contract with Ausenco Ltd for consultancy services associated with the Pre-Feasibility Study (PFS) for the Stage 2 development of its 100%-owned Marillana Iron Ore Project located 100km north west of Newman, in Western Australia’s Pilbara region.

Ausenco is a global leader in engineering, project management and operations solutions to the global resources and energy industries. Ausenco will work with specialist mining consultants Coffey Mining on the Stage 2 PFS, with work to commence immediately and the Study Report to be submitted in June 2009.


Gotta have a chuckle at Pattersons evaluation in June 08:

"We reiterate our A$5.45/sh price target...."




And, I wonder how Duck Creek is going?

Ann Sep 08:

Brockman Identifies Potential Target of 30 – 50Mt of Direct Shipping Iron Ore at Duck Creek

•Surface sampling identifies Channel Iron Deposit (CID) mineralisation with a potential for 30 – 50Mt of Direct Shipping Iron Ore grading 56 – 59% Fe
• Mineralisation contains low contaminants and moderate to high LOI (loss on ignition) – Calcinated Iron grades of 61 – 64% Fe.
• Mineralisation forms mesas, with potentially very low stripping ratios


WTF are these guys doing?

 

[JTLP]

PFS due in June 09.

That's today!

They'll then have to put a covering letter on it, so expect the announcement sometime in 2010.

Ann 3 Dec 08

MARILLANA PROJECT DEVELOPMENT UPDATE

BROCKMAN AWARDS STAGE 2 PRE-FEASIBILITY STUDY TO AUSENCO

Western Australian Iron Ore Company, Brockman Resources Ltd (ASX Code: BRM), is pleased to announce the signing of a contract with Ausenco Ltd for consultancy services associated with the Pre-Feasibility Study (PFS) for the Stage 2 development of its 100%-owned Marillana Iron Ore Project located 100km north west of Newman, in Western Australia’s Pilbara region.

Ausenco is a global leader in engineering, project management and operations solutions to the global resources and energy industries. Ausenco will work with specialist mining consultants Coffey Mining on the Stage 2 PFS, with work to commence immediately and the Study Report to be submitted in June 2009.


Gotta have a chuckle at Pattersons evaluation in June 08:

"We reiterate our A$5.45/sh price target...."

Pattersons reeks of failure. They slap price targets like that when they do the cap raising at 2.50 a share I believe. Bargain basement!

There is no way we will be seeing that stage 2 PFS (as you mentioned already) tomorrow. If they have an IN and OUT tray in the office they are still back officially listing themselves on the ASX under the new name.

The I/O boys in the Pilbara should just all merge and try and fight their way to the top..kind of like 3 players (BHP/RIO, FMG, NWIOA)...better than all this crap time wasting with PFS etc...just go hell for leather for more ore than you know what to do with!

 

[JnrTrader]

another increase in shareholding, something is brewing kennans, surely. The chinese have come out and stated they will invest large amounts of $$ in aussie iron ore projects and this co. might have some inside knowledge, or, making the first move with belief that $$ will be spent on brm soon enough. If you look at ext now, when rio bought into them, and immediately so did polo, acorn capital, ect... perhaps this mob have decided to act first with strong belief of the big chinese steel co to come in like rio with ext, next few months will be interesting. i currently do not hold, but i think this will change very soon

 

[Sean K]

Chart is a good example of some triangley type formations appearing here and there and the outcome. Watch for volume coming off and the triangle narrowing as a good sign. Doesn't always result in a break up of course, just probable.

 

[Go Nuke]

Agree Kennas.

Its all about these triangles.

Either a breakup or break down coming.

Dont want to see $1.15 again.

 

[Sean K]

BRM just staggering sideways at the moment, while the market has run. Bit frustrating really.

There was a report written recently by Foster Stockbroking which was pretty bullish.

Major risks are still access to the rail line and capital costs, expecially for the port facility which will cost billions.

Valuations will be effected by opex associated with milling too, highly dependant on benefication of the detrital ore.

Increading the DSO at Abalone might be handy.

PFS due today!!!


Valuation

We have modelled BRM ramping up to 25mtpa by 2015 and assumed capital cost and operating costs of $1.2b and $40/tonne FOB respectively. Using long term prices of $0.95/Fe unit and $0.82/Fe unit for lump and fines respectively and an AUD/USD exchange rate of 0.75, the Marillana project potentially generates an annual EBITDA of close to $650m, has a current valuation of ~$12.00/share, and an IRR of greater than 30%. The capital cost of the port is not included in the analysis above, but is included as part of the operating cost of the port handling fees.

While the project is in the early stages of development, the progress to date BRM has made on rail access and port development is very positive. We expect to hear further encouraging announcements on rail access early next year. In anticipation of positive news on this front, a nearer term catalyst for the stock could be further corporate activity, either at the parent level or a sale in a minority stake in the project. Encouraging Pre-Feasibility Study results in July 09 may also act as a short term catalyst for the stock.

BRM has ~$100m in cash, no debt and a Market Capitalisation of ~ $160m. Despite the risks, we don’t believe the risk/reward profile reflects the current progress and position of the Marillana project and believe the company will significantly re-rate over the next 12 months. We have set our 12 month price target to $3.20/share, reflecting a 75% discount to our one year forward DCF based valuation.

Recommendation. BUY BRM (Price: $1.20; $PT: $3.20)

 

[Amor_Fati]

Interesting prefeasability study out today. I present their dot point summary for your perusal but their is more info in the actual report (eg discounted risk free rate assumed to be 8%, which I thought was maybe a bit low/optimistic given the borrowing rate for companies is almost that high now if I'm not wrong) If the NPV is really 1.4billion and they have a net cash balance of close to 100 mill then they look pretty attractive with market cap of 177million. But anyway things are looking good, need to tie up the rail access now.

• Pre‐Feasibility Study confirms the (“Marillana Project”) is financially and technically positive,
  positioning Brockman to become the most substantial producer amongst the Pilbara’s emerging
  iron ore miners
  
• Potential NPV’s in the range from A$1.39 billion to A$1.64 billion with accompanying internal
  rates of return ranging from 19.5% to 25.1% for four alternative Project development options
  
• Subject to securing port and rail access agreements under state or federal government regimes,
  production is forecasted to start in Q4 2012 at a nominal rate of up to 17 Mtpa of 58‐62% Fe
  beneficiated product with a minimum mine life of 20 years
  
• Upfront capital costs estimated to range from A$705 million to A$1.35 billion
  
• Total operating costs estimated to range from A$31.50 to A$34.10 a tonne FOB (excluding state
  royalties)
  
• Environmental Impact Assessment on schedule with EPA approval of Scoping Document pending
  
• The Brockman Board has endorsed the Study and approved the decision to proceed to a
  Definitive Feasibility Study

Sorry about the asterisks I don't know what happened there