openhandedgrouse (< 20)

Lgdi.OB could be over $20 a share in the next 4 to 5 years and a 100 to 1000 bagger over the next 30 years.

March 07, 2011 – Comments (3) | RELATED TICKERS: LGDI.OB , BYDDF.PK , LPH

Why Invest in Legend?

http://www.lgdi.net

Lgdi.OB could be worth over $20 a share in the next 4 to 5 years and a 100 to 1000 bagger over the next 30 years. 

How do I come up with those figures?  The company is planning to build a plant that will start output in 2013 at an annual rate of 1.8 million metric tons of nutrient fertilizers a year.  They plan to make $257 profit per ton at current prices. (1,800,000 x 257)/226,333,392 current shares= $2.04EPS.  However, they will probably enter a joint venture in order to pay for the plant for about half of the company. That means current share holders will have about 1.02 EPS x a PE of 20= $20.

The demand for fertilizer and the nutrients that make up fertilizer will only grow.

Mineral fertilizers are the only means to enrich the soil, there is no substitute for Phosphorus.

World population is growing (70-80million people to be added next year).

Bio Fuels are subject to production mandates by Governments worldwide thus adding to the demand for crops.

Finite supply of arable land due to urbanization and industrialization.

Increase in income leads to an increase in protein based diets, particularly in developing nations like China and India.

Decrease in world grain reserves (lowest in approx 45 years)

Legend’s cash margin, using the long-term estimated DAP price of US$531/t and the effective operating costs of US$273.7/t, is US$257.3/t. This margin is well above the US$180/t that CRU estimates is needed to justify investment in any new phosphate chemical complex.  

I like that the top 5 share holders own 69 percent of current shares.  I believe they will look after their own interests, which will in turn protect other share holder interests.  

The top 5 shareholders are as follows. 

1.    Renika Pty LTD owns 21.2%

2.    Indian Farmers Fertiliser Cooperative owns 15.2%

3.    Attara Capital LP owns 13.5 %

4.    Soros Fund Management owns 10.4 %

5.    Chabad house of Caulfield owns 8.8%  

 

http://www.bloomberg.com/news/2010-12-03/legend-said-to-seek-buyers-for-parts-of-australian-phosphate-operations.html?cmpid=yhoo

Legend Said to Seek Asian Buyers for Part of Australian Phosphate BusinessBy Cathy Chan - Dec 3, 2010 1:54 AM ET

Legend International Holdings Inc., backed by Soros Fund Management LLC, will next week approach buyers for part of its Australian phosphate project that’s worth as much as $1 billion, according to a person with knowledge of the matter. The Melbourne-based company will ask for preliminary bids in early January, said the person who declined to be identified because the details are private. Legend International hired Nomura Holdings Inc. to advise on strategic transactions for the deposits in the Georgina Basin in Queensland state, according to a Dec. 2 statement. “We’re looking for a strategic partner who has expertise in phosphate fertilizers and also has the financial muscle to assist us in building an $800 million plant,” Chief Executive Officer Joseph Gutnick said in an interview, without giving a timeframe. “It’s very hard to put a value until we get into production or we export phosphate rocks. I wouldn’t like to guess a figure at this stage.” The company is planning to build a plant that will start output in 2013 at an annual rate of 1.8 million metric tons of nutrient fertilizers a year, it said in the statement. Demand for fertilizers is rising as shrinking arable land and rising world food demand spurs consumption and takeovers. Legend International’s phosphate deposits may be valued at between $500 million to $1 billion, the person said. The company owns total mineral deposits of 1.2 billion tons near the city of Mount Isa, according to its website. Asian Buyers The company will approach potential partners in China, Korea, Japan, India and Southeast Asia, Gutnick said. He hasn’t decided whether to sell a majority or minority stake as that will depend on the partner who may choose to take out a loan or invest in the project, Gutnick said. Anne Lui, a Hong Kong spokeswoman at Nomura, declined to comment. World food prices climbed for a fifth month in November, rising to the highest level in more than two years, according to the United Nations’ Food and Agriculture Organization. The FAO’s index of 55 food commodities jumped to 205.4 points, the highest level since July 2008, the Rome-based agency said in a monthly report on Dec. 1. Soros Fund Management LLC owns 10.4 percent of the company, Atticus Capital LP, a New York-based hedge fund, owns 13.5 percent, according to Legend’s website. Takeovers Legend’s phosphate and mining business consists of three phosphate deposits in Mount Isa in the Georgina Basin. The company proposes developing the project in two stages, including a phosphate fertilizer complex and a beneficiation plant that will be used to upgrade phosphate ores mined, the statement said. “The outlook for global phosphate demand and prices is very attractive on the back of the growth in global food demand, increasing importance of food security and emergence of phosphate fertilizer as a key ingredient in enhancing food supply,” said Sheryar Chishty, global head of industrials investment banking at Nomura, in the statement. K+S AG, Europe’s largest potash producer, agreed to buy Canada’s Potash One Inc. for C$434 million ($427 million) in November, the same month that BHP Billiton Ltd. abandoned its $40 billion bid for Potash Corp. of Saskatchewan Inc. after Canada’s government objected. To contact the reporter on this story: Cathy Chan in Hong Kong at kchan14@bloomberg.net. To contact the editors responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net;

 

 http://finance.yahoo.com/news/Legend-International-bw-276605114.html?x=0&.v=2

Legend International Announces 60 Year Mine Life from Its Maiden Mineral Reserve Estimate for the Paradise South Phosphate Deposit

Press Release Source: Legend International Holdings, Inc On Thursday February 24, 2011, 6:00 am EST

MELBOURNE, Australia--(BUSINESS WIRE)-- Legend International Holdings, Inc (OTCBB:

LGDI.ob - News) (Legend) is pleased to announce its maiden mineral reserve estimate for its 100% owned Paradise South phosphate project. For this initial mineral reserve estimate, Legend aimed to define reserves for a minimum 30 year mine life to support the base case scenario of producing 600,000 tonnes per year of Diammonium Phosphate (DAP) and Monoammonium Phosphate (MAP) high analysis phosphate fertilizers, for 30 years as covered by Legend's feasibility study (see press release dated July 24 2010 on the company website www.lgdi.net).

The resulting mineral reserve estimate is well above expectations with the following highlights: Proven and probable reserves of phosphate rock that will support 59.8 years of operation for the 600,000 tonnes DAP and MAP per annum production scenario or 29.9 years at a doubled rate of production.   (According to my calculations the lifetime value of Paradise south is 30 years x 1,200,000 tons x 257 profit per ton = 9,252,000,000/226,333,392 shares = 40.88 'As-mined' proven and probable ore reserves of phosphorite of 196.1 million tonnes at 14.6% P2O5. Proven and probable mineral reserves of recoverable, commercially useable and internationally marketable phosphate rock concentrate of 55.5 million tonnes at 33% P2O5 (72 BPL). Reserves based on a DAP price of US$445 per tonne FOB Tampa with DAP prices currently over US$610 per tonne.

For the full report with maps and tables included please see the detailed technical report available on Legend's website www.lgdi.net

Following Nomura's appointment as Legend's financial advisor (see press release dated December 2, 2010) keen interest has been received by international industry corporations for potential strategic transactions involving development and financing of the phosphate assets. A number of parties are conducting due diligence on the phosphate assets and the company is continuing discussions with these parties.

The reserve area targeted by recent drilling within the Paradise South Mining Lease Application (MLA90197) equates to only approximately 70% of the area that contains historically defined mineralised material within this lease and only approximately 50% of the area that contains historically defined mineralised material within Legend's exploration licence EPM16942. The current reserve estimates correlate well to historical (1970's) estimates. This supports potential further increases in reserve tonnage upon successful future drilling results within areas that have not recently been tested with modern drilling techniques but have reported phosphate intersections in historical drilling information.

Paradise South is one of seven phosphate rock deposits controlled by Legend and is the first to have a current mineral reserve estimate reported. All seven deposits however have historically reported mineralised material of significant tonnage.

Reserves

The reserve estimate is presented below in Table 1 as both "as-mined" ore reserves of phosphorite which will provide feed for the beneficiation plant to be located at Paradise South, and the recoverable commercially useable or marketable phosphate rock concentrate or "product" mineral reserves achievable from the ore reserves. The ore reserves and mineral reserves cannot be aggregated as the mineral reserves represent the recoverable product derived from the ore reserves after beneficiation of the phosphorite. Reserve classifications are as defined in the U.S Securities and Exchange Commission's Industry Guide No. 7.

The "as-mined" proven ore reserves of the Paradise South phosphorite deposit are currently estimated at 98.0 million tonnes of phosphorite at 15.3% P2O5. The Paradise South phosphorite deposit contains additional probable ore reserves estimated at 98.1 million tonnes of phosphorite at 13.9% P2O5. The total proven and probable ore reserves are estimated at 196.1 million tonnes of phosphorite at 14.6% P2O5. These reserves are based on a block model, typical of industry standards, developed from 180 drill holes using reverse circulation drilling technology and 32 cored diamond drill holes.

The recoverable, proven mineral reserves of the Paradise South phosphorite deposit are currently estimated at 28.9 million tonnes of phosphate rock concentrate at 33.1% P2O5 (72.4 BPL). The Paradise South phosphorite deposit contains additional probable mineral reserves estimated at 26.6 million tonnes of phosphate rock concentrates at 32.9% P2O5 (71.8 BPL). The total proven and probable mineral reserves are estimated at 55.5 million tonnes of phosphate rock concentrates at 33.0% P2O5 (72.1 BPL). These reserves are based on a block model, typical of industry standards, developed from 180 drill holes using reverse circulation drilling technology, 32 cored diamond drill holes and a beneficiation process developed specifically for Legend's phosphorite ore types.

The projects base case scenario of producing 600,000 tonnes per year of DAP/MAP fertilizers requires approximately 0.93 million tonnes per annum of phosphate rock concentrate at 33% P2O5 to feed Legend's proposed Mt Isa Fertilizer Complex. The above proven and probable phosphate rock concentrate reserves of 55.5 million tonnes therefore provide a total project life estimated at 59.8 years. This mine life calculation is based on recovering 93% of the P2O5 from the rock concentrate during the acidulation process and 95% of the P2O5 during the DAP/MAP granulation process. It is also based on producing MAP and DAP at a 2:1 ratio which have total P2O5 contents of 52% and 46% respectively. A doubled production scenario would provide an estimated total project mine life of 29.9 years.

Proven reserves are based on an area of influence for each drill hole not to exceed 20 acres (8 hectares). Probable reserves are based on an area of influence for each drill hole not to exceed 40 acres (16 hectares).

It is reasonable to expect that additional fill-in drilling to reduce the drill hole area of influence will result in the reclassification of probable reserves into the proven category. Legend may endeavour to expand the Paradise South proven and probable reserves in future drilling seasons.

Project Expansion Study

An expanded study has also been underway to examine the feasibility of doubling production to produce 1.2 million tonnes of DAP/MAP and 30,000 tonnes of AlF3 per year. Indications are positive in that the project economics improve with increased scale and that the proposed scale is technically and economically feasible. The above reported reserve estimates also warrant an expanded production scenario with no further drilling required. Completion and reporting of results of this study are now estimated to occur before the end of this current quarter (Q1 2011).

Forward-Looking Statements

Forward-looking statements in this press release are made pursuant to the "safe harbour" provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties including, without limitation, the risks of exploration and development stage projects, risks associated with environmental and other regulatory matters, mining risks and competition and the volatility of mineral prices. Actual results and timetables could vary significantly. Additional information about these and other factors that could affect the Company's business is set forth in the Company's fiscal 2009 Annual Report on Form 10-K and other filings with the Securities and Exchange Commission.