UMC 0.00% $1.30 united minerals corporation nl

north kimberley bauxite alumina

  1. 716 Posts.
    One of the other really questions that flicks out of the last week or ten days of discussion is that of the position of Rio in all of this.

    If the view of Bungy is right and say 75% of the TR is to be put to one side for World Heritage Listing as part of the process to get access to the remaining TR, surely Rio must be aware of the negotiations going on?

    If so, what is their stance?

    If the project is not a goer without that 25% of the TR under UMC/ Hydro's belt, how does the JV get access to the bauxite?

    Bungy noted that it could buy the bauxite at the mine gate or Rio could lose the tenements.

    What if Rio were already negotiating with the JV negating any need for the State to strip the MPJV of its TR?

    On my understanding, there's about 457mt of bauxite grading 44% alumina.

    If we say that 25% of that is kept for mining, and that this is the higher grade stuff, then let's say this equates to about 30% (very rough) of the total bauxite reserves (proven and probable): or 137mt.

    Assuming a 3mtpa refinery (and again very very rough back of the envelope), we're looking at only around about 23 years of mining out of the Plateau.

    Twenty three years is hardly enough to keep Rio interested in a bauxite mine only given all the green tape. Would seem to make sense that it would rather leave that to someone else?

    What about if it hand-balled the remaining stake in the TR in return for a stake in a smelter down-south or some other deal?

    The lessons from Cape York would seem to be very clear. If most of the Plateau is going to be World Heritage Listed, Rio too smart to be sitting back and locking in a defensive strategy for only a twenty three year mine life.

    Seems insufficient kanga in the twenty five percent of the Plateau to cover the headaches of a high capital cost greenfields refinery plus all the red and green tape to go with it. Easier to palm that off to someone else.

    UMC/ Hydro have Kalumburu mine + one hand on the TR premiership cup mine it seems to me?

    Lock in a refinery next to a new gas plant and the bauxite mine and refinery is away.

    But first, the IPO spin-out out of UMC through BA.

    BUSH
 
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