Hebe,

Sorry that I did not respond to your note earlier (got caught up with something else). Your post contains quite a few important items. You have done your own DD well.

This caught my eyes in your post : "When we go to the track there are 10 races or so to bet on every night… In the first race I have already put my money on the horses not the riders. IMO, Xstrata/Gllencore, Cliffs & X2 etc., are riders not a horses! The horses in these races are the little guys or exploration comp’s like NOT, KWG. Bold, BMK etc."

That's an interesting classification for horses and riders. I have not gone to the track, hence I would not have a clue how to bet there. In my simple analysis I dove right in (as you said) to pick Xstrata/Glencore as the winning horse in a race for KWG. From what I seen so far, this combination is a major (a 700-lb gorilla) which would have enough resource/cash to fund something of the order of $3B. Lately, they have been involved in a consolidation in the Sudbury area with Vale. They are both in Ni and Cr...and stainless steel (guess who has iron mines in Quebec). On the other hand, CLF has been making a lot of noise about its proposal for BT, but as a 300-lb gorilla, with a Mkt Cap @ $3.7B, it would be difficult for them to fund something which would cost approximately the same amount. In fact, they are working hard to conserve cash, including closing down operations/activities related to RoF. In fact, they better take a look behind them to see if they are being watched by a bigger fish (one gulp for fish of the size Xstrata/Glencore). X2 is not one of the horses, since this group would normally prefer some brown fields rather than the greenfield like RoF. They want a shorter time span for their ROI. May be, I will be in for a surprise when X2 rears its head and strikes.

The other potential and credible horse for this race would be Baosteel (another 700-lb gorilla in my book, who has been sitting in the NOT corner, watching...noting that Baosteel is in the same theatre for Ni, Cr and iron/stainless steel.

Sounds awful, but I would not mind a messy bidding war for KWG among the titans.

To all KWG longs, Happy Holidays!

Just my musings for the day...its bad weather out there.

goldhunter