Barbu

Your post refers to the last MD&A, part of which reads:

In testing chromite ore from the Black Horse occurrence, it was discovered that its reduction to metallics was possible with the use of natural gas under controlled circumstances. A patent has been applied for in advance of further testing to commercialize this direct reduction method of refining chromite into metallic chrome. The method holds significant promise of enabling the chromite of the Black Horse occurrence to earn a considerable share of the market for chrome inputs amongst 5 stainless steel makers, due to the much lower refining cost of the method when compared to refining chromite to charge ferro chrome in electric arc furnaces."

It's my take that KWG was very careful (and conservative) in its claim. But, other ores in the area, especially the ones that belong to NOT (e.g. Blackbird which could be part of the same ore deposit). So, it would be expected that KWG would have at least one customer that could benefit from the low-cost natural gas direct reduction technique. In addition, further testing with positive results would bring in many more customers with chromite deposits in the same area (BD, BT and BC).

It would be no surprise to see CLF coming back with its proposal to mine BD (ahead of BT) and modify its plan to build the arc furnace (at a cost of $1.8 B, and with subsidy from the government to make its operation viable). Part of the $1.8 B could be used to build the gas-power reduction plant, and part of this money could be used to build the RR?

Mr. Boor: Are you keeping an eye on this chatter board for ideas?

We have not heard about the cost of a furnace using natural gas from KWG, but it would be expected to be much lower than the electric arc furnace (Frank must have a ball park figure from the cost of similar reduction plants in the world, e.g. South Africa?

Natural gas is much cheaper than electricity to operate...and no subsidy from the government would be required. This "no subsidy" factor would be a good thing for the Ontario government to sell the package to the voters.

goldhunter