First, thanks Notster for the 13 Oct 2011 report. Even old, but it's only 4 months ago and some key facts remain all most the same for PRB (with some improvement). Nice comprehensive report.

LT/Mark quoted

“The M+I+I 43-101 resource of 8,440,000 tonnes averaging 40% Cr2O3 has an in situ value of about $1.2 billion, which makes it worthless on a standalone development basis, but its location certainly creates incentive for Cliffs to cut a deal which consolidates this missing piece into its development plan and eliminates the risk of future litigation related to infrastructure positioning that stymies Probe's opportunity to exploit its asset.”

That triggered two points

- access roads and water pipe. The value for CLF is obvious. PRB position is simple "want access, pay"

- second point is the buffer zone around that corner (BC, BD and FNC/C-5 area). Let's leave FNC out for now, but CLF would need access though FNC lands as well. The sencond point would involve the buffer zone between PRB and CLF. Please correct if I am not precise, but as I recall PRB BC claim is some 500m x 2000m with about 1000m along the length and 500m height butting in CLF/BD area. A back of the napkin calculation show a buffer zone of 60m x (1000m + 500m) x depth of 100m (assumed) x 2.5 sg would yield approximately 22.5 M tonnes of rock, which is about 3 times the 8.4 M tonnes resource for BC. hence this buffer zone of 100 m depth assuming the same rock quality would be worth quite a bit of money for the chromite alone (certainly much more than the un-formal offer of $60M. Let's say $180M plus the toll for transportation and water pipe access. Anyone has an idea how much PRB could charge?

Anyway, please pull out your pencil and check my math and postulate other scenario like 200m depth (this is easy math, just multiply by 2)?

goldhunter