Canadian iron ore exploration and development company Black
Iron (TSX: BKI) (OTC: BKIRF) (GR: BIN) this morning reaffirmed economic
projections for its Shymanivske project, citing a weeks-long surge in iron ore
prices after Vale, one of the world’s largest iron ore producers, took 11 mines
offline, significantly hindering supply. The shut-down of Vale’s mines
represents ~6% of global consumption with a combined production loss of 70Mtpa.
In response, Iron ore prices spiked to the current US$87/T for benchmark 62
percent iron content fines and US$106/T for 65 percent iron content fines.
While analysts have mixed projections on the length of time the iron content
benchmark price will stay at elevated levels, there is consensus that prices of
iron content products, more specifically prices for iron ore pellet products,
will increase for at least the next few years as the industry responds to lower
supply. As a result, the premium 68 percent iron pellet feed product that Black
Iron plans to produce is expected to sell for a significantly higher price than
benchmark iron ore for at least the next two to three years. The company
intends to build its Shymanivske project in two phases, taking advantage of its
proximity to rail, power, ports and skilled labor to reduce upfront capital and
time required to generate cashflows. The first phase of the Shymanivske
project, expected to produce 4 million tonnes a year, requires a capital
investment of US$436 million. An additional US$312 million is required to double
the Shymanivske project’s production capacity to 8 million tonnes, which could
potentially be fully funded from the free cash generated by phase 1 production.
To view the full press release, visit http://ibn.fm/PdXD4
About Black Iron Inc.
Black Iron is an iron ore exploration and development
company, advancing its 100 percent owned Shymanivske project located in Kryviy
Rih, Ukraine. The Shymanivske project contains a NI 43-101 compliant resource
estimated to be 646 Mt Measured and Indicated mineral resources, consisting of
355 Mt Measured mineral resources grading 31.6 percent total iron and 18.8
percent magnetic iron, and Indicated mineral resources of 290 Mt grading 31.1
percent total iron and 17.9 percent magnetic iron, using a cut-off grade of 10
percent magnetic iron. Additionally, the Shymanivske project contains 188 Mt of
Inferred mineral resources grading 30.1 percent total iron and 18.4 percent
magnetic iron. Full mineral resource details can be found in the NI 43-101
compliant technical report entitled “Preliminary Economic Assessment of the
Re-scoped Shymanivske Iron Ore Deposit” effective November 21, 2017, under the
company’s profile on SEDAR. The Shymanivske project is surrounded by five other
operating mines, including ArcelorMittal’s iron ore complex. For more
information, visit the company’s website at www.BlackIron.com.
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