Massive Black Horse Chromite Discovery

Black Horse deposit has an Inferred Resource Now 85.9 Million Tonnes @ 34.5%

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Message: Cliffs PR = Hanoi Hannah = Tokyo Rose

Most of us know that fear is much more powerful than greed and if you read this message carefully, you notice that it is weak in depth and certainty...Duh! It' obvious that they have made statements that are completely non-committal and intented only to foster doubt and fear among those who have sided with KWG.

A "base plan" is tatamount to making a personal plan for your day by saying "I think I'll go shopping today"...no details, no commitments. Their plan serves two purposes...it displays enough intent to attract attention from the political side and AT THE SAME TIME it deepens the shadow of doubt for those who have speculated about the possibility of Cliffs leaving KWG in the dust and possibly diluted them to nothing.

What is important to remember is the following (among other collateral issues):

1. If Cliffs actually decides to move in the direction of BLack Thor, it wouldn't take very long for their shareholders to realize that they (Cliffs) have selected the less profitable of two options which would beg the question: "Why spend all that money for SPQ and FWR years in advance of ever seeing any development and profit"

2. If Cliffs is posturing and were to try to present KWG with a cash call for the development of Big Daddy, the trump card that KWG is holding, is their own cash call that they could present to Cliffs for the development of the RR which amounts to approx $400mil. (Cliffs owns 19.3% of KWG)

3. If Cliffs try to sell the idea of an all season road it won't take very long for anyone to realize that a road up north which would cost approx. $2mil+ per km to build' would be a ridiculous temporary measure not to mention the maintenance costs and the environmental issues associated with running hundreds if not a thousand trucks per day on that road....yeh let's develop that idea all the way to the feasibility stage.

Additionally, I can't see Clf shareholders accepting that Cliffs would develop a less profitable option while another buyer comes in and acquires the option that is 2 to 3 times more profitable plus the Black Creek resource (Probe - PRB) which is of similar tonnage (slightly lower) and concentration. Remember the costs associated with the permanent loss of 30% of future annual revenues from Big Daddy.

Cliffs' news release yesterday was merely a feable attempt at suppressing the innevitable up side on KWG's SP, fueled by the notion that KWG has just discovered a long lost big brother who is 6'5" 250lbs, and interested in the well-being of their project.

This is setting up for a possible bidding war. Should be very interesting especially when the 43-101 comes out...might not even wait that long.

Best of luck to all...don<t pay too much attention to dissinformation if only to get a chuckle out of it.

LP

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