Hey Rescue9...(question from Stockhouse)

I apologize for not clarifying that the calculation was done on average Ferrochrome prices which range from High Carbon 1.70 per pound to Low Carbon 2.55 per pound in North America.

1 million tons of ore = 400,000 tons of ferrochrome at 40% recovery which is the reported recovery for Big Daddy

400,000 tons = 280,000 tons at a 70% net profit estimate (adjustment for production cost)

280,000 tons x 2000 = 560 million pounds (conversion tons to pounds)

560 million pounds @ 1.70 per pound for HC = $952 mil. @ 30% share = $317 mil.

560 million pounds @ 2.55 per pound for LC = $1.428 bil. @ 30% share = $428 mil.

Since our carbon content at BD is optimal for the production of stainless steel (1:3 ratio) I chose to retain an earnings level closer to the LC price rather than the HC price.

It has also been unofficially reported that Cliffs intends to mine more than 1 million tons per year (possibly two to three million tons), which only grows the numbers in our favour. Obviously many variances can come into play but I think that this calculation gives us a good idea of the value in ferrochrome.

Again...my apologies if my assertions were not backed up with a clear representation of my calculations.

Best of luck to all long KWG shs
Pear3

Question from Rescue9 on stockhouse

Thankyou lou for posting the prices that I requested.Much appreciated.If those prices are correct,and I have no doubt that they are,that makes the following statement by Pear3 invalid,IMO.
" once the JV becomes a partnership, then KWG's share of BD earnings isapprox. $400 million for every 1 million tons of extracted ore. "
I know we have alot of value with our 30% and the NSR but those figures don't make sense to me.Please correct me if I'm wrong.TIA.
R9