GREY:AXXDF - Post by User
Comment by
greenandgoldon Sep 26, 2011 9:15am
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Post# 19083159
RE: RE: RE: What is the value of Rose Central to A
RE: RE: RE: What is the value of Rose Central to AWhy are you assuming ADV will sign a similar deal (20%/80%) to NML/Tata? Alderon is not giving away the majority of its project because it doesn't have to. It will raise the rest of capex ($900 million) through offtake deals and equity raises (dilution). They will keep control of their project through production.
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I have no idea what ADV should currently be worth. I do have certainty it will be built. $1 billion is a reasonable amount of capex and the existing infrastructure is the key factor. Other iron ore projects in Canada have better valuations on paper but they may not get built in this resources cycle because of staggering capex requirements ($4 billion can turn into $8 billion easily) and difficult infrastructure issues (don't envy any company that has to build a long railway or a slurry pipeline in the sub-arctic cold). If they don't get built in this resources cycle the companies will be worth the cash they have on hand.