Fortescue Metals Group
(ASX:FMG) is in the headlines with at least one analyst saying that the company has a lot of work to do to hit its 20 billion tonne iron ore target at its tenements in Western Australia's Pilbara region.
Hartleys resources analyst Andrew Muir says the resource estimate is considered acceptable but to achieve it a lot of drilling needs to be done to make Fortescue's target compliant with Australia's mineral reporting code, JORC.
Fortescue executive director Russell Scrimshaw was quoted yesterday as saying the company had up to 20 billion tonnes of iron ore on its vast landholdings.
It follows similar comments by chief executive Andrew Forrest at Fortescue's annual general meeting in November, 2009.
The meeting was subsequently followed by an accompanying presentation that said the figure included hypothetical estimates.
Mr Muir says that by giving the 20 billion tonne estimate, Fortescue is basically raising expectations of the scale that it's got.
Fortescue Metals posted a $626 million net profit result in 2009.
