First I understand why Cliffs wants FWR. They are publically on record that they want to develop a chrome mine. They are in the business of supplying the steel industry with iron ore and coal. Chrome is a logical extension of their product line and they would have the industry connections and supply chain in place to get the chrome to buyers.

What doesn't on the surface make sense to me is why Noront wants FWR. They have chrome of thier own and it seems that to this point that they have mainly focused on the nickel, copper and PGE's with chrome being an ugly step-sister which didn't warrant much attention. Why is NOT not going after FNC and/or Probe whose holdings are right next to the Eagles Nest instead of FWR? Secondly a lot has been made of the fact that there are supposed synergies from consolidating the properties. I can see this to a limited extent, but at this point what we have is a large area of underexplored FWR land being combined with a very very large area of NOT underexplored land . Both properties seem to have great potential but in both cases the resource most in short supply is cash to fund exploration to prove resources that then can be either sold or developed into a mine.

What would be the downside of Cliffs developing a chrome mine adjacent to Noront's property? Would having a road and/or railroad and power lines next door instead of 300 km away have a negative effect on the value of Noront's holdings? I cannot see it being in Noront's interest to get a piece of FWR just big enough to stop Cliffs so that NOT can play the role of "dog in the manger" for a few years. So what is the NOT end game? It seems to me that for NOT having infrastructure extended into the ROF would be a huge advantage and of course they need lots of cash with minimum dilution. So let's assume that NOT aquires 50% of the 214 million FWR shares through thier present offer, might thy not plan to simply turn them over to Cliff's for $95 million or perhaps they could negotiate a higher price and assured access over any infrastructure built, or perhaps a royalty. In any case I would expect that if NOT went to the market and just tried issuing stock to raise $95 million it would have a significant negative effect on the stock price.

Finally it would seem that if Cliffs are really intent on developing a chrome mine at a cost of $800 million by 2015 ( this seems like a pretty aggressive schedule) to produce one to two million tons or chromite a year, throwing in another $100 million or so to secure the FWR resource would be no big deal. NOT has said final offer- if you were Cliffs why not just blow thier final offer out of the water with a $1.35 per share bid. It would seem to me that Cliffs needs to sweeten the offer in the next day or so or Noront is going to be playing the part of spoiler. Perhaps, there is some tacit understanding between Noront and Cliffs not withstanding the public posturing. If we don't see another Cliffs offer in the next day or so, that would be my speculation.