I see this as mind staggering dynamics that should lead to profit for CHM and FNC. I need to think and make some phone calls. It may explain a few clues.

My immediate reaction is: how does Arcelormittal feel about this? I'm fairly certain they've signed non-disclosure agreements with CHM to keep informed of their drill and geo results. Arcelormittal stated that they want vertical production. I believe CHM’s 1.2billion tons of iron is beyond a doubt part of their plans.

Many are surprised that Arcelormittal didn't take out Consolidated Thompson a long time ago. Now they see Cliffs consolidating the Fermont properties by acquiring Thompson. My conclusion is that there will be an offer for CHM in the 1st quarter of 2011, initiated by Arcelormittal.

FNC’S POSITION

Now let’s examine FNC's position, with a little stream of logic. They were a possible temptation to Cliffs in ROF. However, as Noront and Probe discovered, if Cliffs ever will expand beyond the JV’s, now is not the time. Now, 17.5% of CHM’s Fermont and Lac Lamalee, FNC makes another possible temptation.

For a while, we’ve speculated that CHM was in league with a major, likely Arcelormittal, but possibly Wisco and Consolidated Thompson or Cliffs. Now we know if CHM is in a major’s camp, it is Arcelor’s. We’ve also suspected that part of an offer for CHM by the major is that CHM first acquire FNC’s 17.5%. CHM approached FNC prior to Smith’s vacation. They’ll probably do it again.

Concurrently Thompson’s SP has been on a steady rise, if anyone didn’t know before, now we all know why. Cliffs wanted them. I suspect with Cliffs consolidation today, whether or not CLM’s shareholder votes approve, whatever requirement CHM had with a major to acquire FNC is out the door, due to an increased sense of urgency.

At first you might think that Cliffs has got all they need in Consolidated Thompson.

“Cliffs believes that, with Consolidated Thompson's current operations and successful completion of its ongoing expansion projects, combined with Cliffs' global iron ore operations, the acquisition would position Cliffs to become a producer of up to 30 million metric tons of iron ore pellets, up to 16 million metric tons of iron ore concentrate and up to 11 million metric tons of lump and fines iron ore.” “Upon completion of the acquisition and completion of the planned ramp-up in production, it is expected that over half of the combined revenue base will be generated from customers outside of North America.”

But look at the map, We are all very cozy in Cluster Two. After talking to Champion today, they feel more then confident that their known 1.2 billion tons of iron ore are the very beginning of what lay on their 16 properties. CHM is almost equal to CLM’s overall known tonnage.

“Consolidated Thompson controls approximately 580 million metric tons of proven and probable iron ore reserves at an average grade of 30%. In addition, Consolidated Thompson has over a billion metric tons of measured and indicated resources, with potential additional resources to be proven via a near-mine drilling program.” ”The producing operations are currently ramping to an annualized production rate of 8 million metric tons of iron ore concentrate, with an expansion in progress that is expected to double the company's annualized production to 16 million metric tons.”

Also keep in mind that combined with Consolidated Thompson’s infrastructure allows for low-cost iron production.

“Consolidated Thompson's assets are located in close proximity to a hydroelectric power grid, along with roads and a rail line that link the processing facility to deep-sea ports in Sept-Îles, Quebec. This infrastructure, coupled with Consolidated Thompson's newly commissioned concentrator facility, good quality ore body and absence of royalty payments, positions it among other low-cost iron ore producers around the world.”

Cliffs will want to keep the area well-supplied with iron ore to maintain their low-cost iron production for years to come. They know they’ve got ore still to be explored on their own lands. But CHM has already done the exploration. Arcelormittal is thinking the same thing.

I’m certain Arcelor was mixed up in the talks with Consolidated Thompson and lost to Cliffs.Are they going to wait too long and lose out consolidating CHM’s properties to Cliffs as well? Now that Cliffs has placed dollar value on this ore size, not including Wisco’s customer base, Arcelormittal has got to be wondering if Cliffs will make a move eventually for Champion’s ore. I think Arcelor will make a move before Cliffs gets a chance.

I think Arcelor will make a move while Consolidated Thompson goes through the approval process.

Cliffs' agreement to acquire Consolidated Thompson contains customary closing conditions. These include:

-Approval by two-thirds of the votes cast by Consolidated Thompson's shareholders attending or represented at a future special meeting of shareholders;

-Obtaining all court, government and regulatory approvals, including Investment Canada, Canadian Competition Act, and others; and,

-No material adverse change in Consolidated Thompson's business, financial condition or results of operations.

Or does anyone think Arcelor will sit back, comfortably feeling Cliffs is content with Lamalee and Peppler Lake?

Is it a coincidence, that concurrent with all the above, someone schedules a mid-winter trip to Magpie? There have always been inquiries, but this is the first time a helicopter visit was scheduled –and mid-winter. It’s not the Bahamas here, so why now of all times for a visit? We’ve been marketing this for years. This indicates to me some urgency or necessity to see the property. It may be related to what’s going on in the Fermont properties. Is it possible Magpie is being considered as part of a whole FNC iron package deal?

As I write this, a sour taste comes into my mouth in thinking of Cliffs taking out FNC and NOT. It’s always been a wasteful exercise in the ROF, in a desperate plea for the entrance of a new Major. I think it’s a wasteful exercise here too. I know Magpie is a stretch, but the timing is very coincidental, is it not?

-StockGreed