RJ,

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http://www.wawataynews.ca/archive/all/2012/1/31/cliffs-releases-2012-budget-plans_22337

Cost breakdown from the above (published date: 31 January 2012)

- BT Mine development: $150 M (chump change)

- Concetrator (near-mine): $800 M (BD does not need a concentrator)

- Roads (all-weather): $600 M (CLF needs a corridor to build this road)

Ferrochrome Processing: $1.8 B (this would please the governements) -----------

Total: $3.35 B

Targeted Production: 2015 (3 years from now…2012)

- 600,000 tons ferrochrome

- 1,000,000 tons for chromite

with a healthy cash flow and profits.

Also, according to a recent post, Boor indicated during his testimony that 40% of the stuff could be DSO (wonder where that would come from, BT or the other one?).

From the above the following can be deduced

1. Cost of mine development (BT or BD) is tiny (chump change) compared to other items on the list, hence it doesn't matter which deposit CLF wants to start first. My bet is that when all the posturing (smoke mirror and all) has ended, BD will emerge as the front runner at the finish line. This is elementary and would not require any sophistical computer models and math wiz kids. Some back-of-the-napkin calculations would do just fine for making the decision.

2. For BT, a near-mine concentrator would be required ($800 M which brings the subtotal up to almost $1B). Note: With BD, there would be no need to spend the $800M (or even half of that) which is a very nice chunk of money for chipping in RR funds, perhaps? I don't think there would be any need for ore swap. CLF will start with BD...no brainer.

3. But, of course CLF would need to spend a projected $600 M for it's own road to be built on Crown Land, as if anybody can build anything on Crown Land (somebody said "good luck" to that plan). A better option would be to use that $600 M for doing something with KWG to develop KWG transportation corridor (RR and road together). Other money from the governments will come in as well, i.e. there will be no shortage of money.

4. The biggest item is the Ferrochrome processing plant (at $1.8 B). This is no chicken feed and is a key item for discussion between CLF and the governments (especially the Ont government...a deal may involve adequate power supplies and low electricity rates, etc).

My take is that CLF is serious about RoF, the investment seems large, some $3 B, but the profits are huge. CLF is in the business to make money...and it's a high-stake poker game. Nah, it's no poker game, it's just old-fashioned negotiation.

goldhunter