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Black Iron Inc.
Summary
| Project: | Shymanivske | |
|---|---|---|
| Deposit: | Shymanivske | |
| Location: | Ukraine | |
| Commodities: | Iron | |
| Date: | 11/21/2017 | |
| Report Code: | NI43-101 | |
| Report Type: | PEA | |
| Project Stage: | Pursuing Resource Increase/Upgrade | |
| Report details: | 21-11-2017: Black Iron Inc. announces a PEA report for its Shymanivske deposit at the Shymanivske project. Updated PEA returns post-tax IRR 36.1%, NPV (10%) $1.66B. TORONTO, CANADA, November 21st, 2017 – Black Iron Inc. (“Black Iron” or the “Company”) (TS | |
| Resources: | (Resource, M+I): 645.8Mt @ 31.6% Total Fe at project | |
| CP/QP: | [Resources]: Michael W. Kociumbas (Watts, Griffis & McOuat Ltd.) | |
| ABSTRACT: | TORONTO, CANADA, November 21st, 2017 – Black Iron Inc. (“Black Iron” or the “Company”) (TSX: BKI; FRANKFURT: BIN) has received the results from BBA Inc. (“BBA”) for a new Preliminary Economic Assessment (“PEA”) that incorporates, among other things, a two-phased build out of the mine and production plant along with updated iron ore selling prices and Ukraine’s favourable currency exchange rates for its Shymanivske iron ore project in Kryviy Rih, Ukraine (the “Project”). The updated PEA outlines a first phase operation producing 4Mtpa of ultra high-grade, low impurity, 68% Fe concentrate expanding to 8Mtpa starting in the fifth year of production. By phasing the build, it significantly reduces the up-front construction costs while still being highly economic given all high cost major infrastructure including railway, powerline and deep-sea port are located in very close proximity to the deposit. Using this phased build strategy coupled with Ukraine’s highly favourable exchange rate of 28 Hryvnia to US$1, results in a projected pre-tax, post royalty, internal rate of return (“IRR”) of 42.6%, a payback period of 2.6 years and a US$2.12 billion net present value (“NPV”) at a 10% discount rate. The post tax unlevered economics show a compelling 36.1% IRR, 2.9 year payback period and US$1.66 billion NPV at a 10% discount rate. Matt Simpson, Black Iron’s CEO, commented: “The operation outlined in the re-scoped PEA for the Shymanivske Project continues to clearly demonstrate the potential for a high-value, low net cost iron ore development project. Use of ultra high-grade 68% iron content product in the production of steel is a value-added product to customers as it increases blast furnace productivity and reduces specific greenhouse gas emissions. By building the Project in phases, it also allows for a portion of the costs for the second phase expansion to 8Mtpa to be funded using internal cash that is expected to be generated from operations during the first phase which is expected to reduce dilution, maximize shareholder returns and reduce project financing risks. As a result of these improvements, the Project’s access to significant existing infrastructure (railway, power lines and port), and the availability of a relatively low-cost, skilled labour pool, the re-scoped PEA continues to project extremely attractive and robust economics.” | |
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