I have been reading how Cliffs is preceived to be the deep pockets in the ROF and will drive everything that is going to happen. I finally decided on doing some diligence work on Cliff’s involvement.

Here is what I have found:

1. They have $308M invested in their mining strategy.

2. Cliff’s have invested ~$3M in KWG. (so that’s like 1% of their strategy)

3. It is not on their books anywhere except as a consolidated amount of minor investments.

4. They don’t appear to have invested in anybody else in the ROF.

5. Couldn’t find any statements by Cliffs about the ROF in their marketing materials.

Railroad

I have also read about this railroad a lot, its impact on the ROF, who would control it, etc. So went to see what I could find out about that.

1. KWG engaged Krech Ojard Associates to do a feasibility study.

2. Krech Ojard does not ave not much experience in designing new rail projects, especially in muskeg & swamp. See for yourself http://www.krechojard.com/portfolio/rail.html

3. I see only one project with Cliffs – a port rail yard rehab study.

If anyone has more facts to offer I welcome them as it is pretty sketchy as it is. With the info I have found, I have a number of questions:

1. Why do a number of folks think Cliffs is a major player in the ROF?

2. Why is Cliffs seen as the rescuer of FWR and their stockholders?

3. Why is Cliffs linked to the building of a rail line? Their only association to this seems to be with an engineering firm Cliffs used for one small rail rehab project and that has now been engaged by KWG.

4. Who has designed and built a rail line in this type of terrain?

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