Scale is a concept that many people take for granted; it can mean large or small, many or few. When considering mining and scale, however, the concept of scale and how large scale can really get becomes all too apparent. Phosphate mining falls into this category. Fertilizer is a hot commodity at the moment and will likely become even hotter as leading world food producers come to grips with food production needs. An investor that can find a fertilizer mining company ready to produce, and serve this need, will find extreme profits waiting to be picked.
Legend International Holdings Inc., a mining company with primary interests in Queensland and the Northern Territories of Australia, works to find and develop agricultural phosphate deposits. The company currently holds claim to 5.2 million acres of development licenses in these two potentially lucrative regions and extraction licenses for its Queensland property. It plans to exploit each for mainly export markets.
Past the current commodity price of phosphates and associated fertilizer products, the company has had two rather significant events in recent weeks and months; it has just recently added a board member, with an option for adding another, from the Indian Fertilizer Farmers Cooperative Ltd. (IFFCO) and closed a private placement totaling $105 million. The company’s addition of a board member from the IFFCO gives Legend International access to over 50 million cooperative members and the largest fertilizer company in the Indian market. In any form, these two events constitute a major jump forward in positioning the company for rapid growth with a “high flying” fertilizer market.
From a production and exploration standpoint, the company is also placed in a strategically strong position. Its rights to “new” Northern Territory phosphate exploration land have been established, and financing – through the recent closing of its private placement – is in place. There are quite a few warrants issued at this point, but if ever there were a company ready to light the fuse for solid growth, Legend International Holdings Ltd. would be it.
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