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Guest Dazel

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You have to love buying back shares at these prices...

 

Just imagine they could deploy $100+ Million in these buybacks. We would be all rich men once they dividend out the Kami royalty to us. I am still hoping we can buy back until we got 20M shares outstanding. But thats probably just my wishful thinking ;).

 

cheers,

hohi.

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Yes wishful thinking...but the share count will drop daily...until we are fairly valued.

 

We like the buy backs but our wish path is more at  one or two more dirt cheap royalties streams...

Something unique would be nice...there are a lot of companies starving for capital...

 

Dazel.

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Yeah, some near term cash flowing royalty would probably be even better. But the competition for long-life near-term royalties is also growing. Even BlackRock is buying IronOre royalties these days. More and more people figure out the deadly effects of cost-push inflation... But maybe we get lucky - although some cheap aquisition will in my opionion more likely be a few years away from production.

 

cheers,

hohi.

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Of course there is always a chance they could be wrong. In the long run I think they will eventually be right because it makes sense to me. What seems uncertain is the timing.

 

Its tough for me to make money in commodities- I have to keep reminding myself that this situation (project generator/merchant bank, royalty company, great balance sheet, owner operators) is different than buying the usual mining company

 

Its comforting that these guys agree as they are way smarter than me.

 

Thanks for your continued good posts.

 

Best of luck to all on the board.

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http://www.metalbulletin.com/Article/3128953/Iron-ore-and-coking-coal/Chinas-November-iron-ore-imports-are-the-second-highest-in-history.html

 

 

The reality of some of the numbers coming out of China are a lot different than the ones that are making headlines with regards to their appetite for commodities.

 

Iron or spot price today is $125.

 

Dazel.

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http://www.reuters.com/article/2012/12/08/us-cnooc-nexen-idUSBRE8B619M20121208?feedType=RSS&feedName=innovationNews&rpc=43

 

Canada's approval of the Nexen deal will be positive for the Hebei transaction. Hebei being a state owned enterprise was waiting to see if the Canadian government would approve the deal. I would expect that you will see the feasability study and more importantly the beginning of the financing flow through to Alderon.

 

In fact this deal for Altius is extremely positive as they are involved with SOE throughout the Labrador trough....the development of the area...will need capital from china...

 

When you look at the longterm outlook...the new port, Muskrat falls and a possible railway from CN are the infrastructure pieces needed for a longterm strategy...they will bring down costs of production and make the trough a world class asset. All the pieces are coming together and this deal opens the door to a green light from the Canadian government on SOE's in Canada.

 

Dazel.

 

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"this deal opens the door to a green light from the Canadian government on SOE's in Canada."

 

I thought it was just the opposite.  Going forward it would be less likely that an SOE could gain approval to buy out Alderon in it's entirety.  Which is a net negative for Altius - right?

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I agree, the Nexen decision is a negative for Alderon, not a positive. The Government made it very clear that they would be coming out with new rules that would be more stringent than the previous ones (which were used for Nexen and Progress).

 

 

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These were attached to oil sands investments...china now controls 10% of the oil sands...the new rules will reflect this. other investments

will be done on a case by case investment. Alderon is hardly a national security issue...The chinese governemnt were very happy with the approval. They (China) also approved the Viterra deal the same day as Nexen was announced. That looks like a good government relationship and hardly would have Hebei or Wisco or any other "SOB" thinking Canada is not a good place to do business. The iron ore business in Canada is exremely small with foriegn companies already owning the majority of the assets...Rio Tinto, mitsubushi, Cliffs Natural, Arecellor Mitel,Tata steel etc..now Posco...

 

These are very different rules than the oil industry...

 

Dazel.

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http://business.financialpost.com/2012/12/07/nexen-progress-canada-oil-sands-state-owned-firms/

 

 

In order for this deal to be approved the United States will have to sign off on it. We know as Canadians..our large oil assets are pretty much

controlled by our big brother to the south of us...These new rules simply state the obvious...oil, water, Potash, banks...are of national security issues to both the Canada and the United States.

 

The fact this deal was approved is very good for Canada and China relations and hence Altius.

 

Dazel.

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I don t know that china buying out Alderon in its entirety is that important for us shareholders.

 

Canadian government and us shareholders want to sell + export iron, the more the better.

 

I am going to vote that the Nexen deal helps- my vote is biased though.

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http://www.fool.com/investing/general/2012/12/13/news-encana-petrochina-enter-into-exploration-deal.aspx

 

 

We expect many deals to be announced with china like the one above soon in Canada...oil sands are off limits but the rest of the country will seek to produce the commodities that china will need for their Rebound.

 

As Jim Rogers has said for 2 years...the Chinese have had their foot on the breaks in order to slow inflation and their economy. He said if anyone does not see this they are stupid!

They are now taking that break off...all of their numbers are at 14 month highs and moving up...all commodity prices will rise in this environment...as we have seen with iron ore rising 50% since September.

 

Altius does not need iron ore to rise above the $130 it is at now...it will however, benefit from the other rises that will take place.

 

Dazel.

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http://www.businessspectator.com.au/bs.nsf/Article/Paladin-shares-surge-on-Japanese-election-result-pd20121217-32W3Y?opendocument&src=rss

 

Japan's new government are pro nuclear...uranium could have a huge year...2013 is the end of the U.S- Russia decomissioning  of nuclear weapons for use in nuclear power plants. This is a huge part of the world uranium supply coming out of the market...you add a restart in Japan with this and the demand from the new plants coming on line...it is a perfect storm for uranium...and repricing of Altius' uranium assets.

 

Dazel

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Let's wait for the feasibility study. They will assume a long term spot price anyway. The movement of the spot price up or down over the last two months has nothing to do with it. Let's not count our tonnes of Fe ore before there is a feasibility study!  ;)

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Agreed.

However, bankers are fickle...spot price and sentiment do matter when you are raising $700 million or so! Study, then the next off take agreement, then debt raise. Muskrat falls is supposedly getting formal green light tonight according to CBC....

 

Altius  long-term spot price number is $115 in their projections we are happy with that...we are around $135 right now.

 

Dazel.

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