NetworkNewsBreaks – Black Iron Inc. (TSX: BKI) (
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Posted On: 02/14/2019 2:38:29 PM
NetworkNewsBreaks – Black Iron Inc. (TSX: BKI) (OTC: BKIRF) (GR: BIN) Reaffirms Economics of Shymanivske Project Based on Spike in Iron Ore Prices
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.
Please see full disclaimers on the NetworkNewsWire website applicable to all content provided by NNW, wherever published or re-published: http://NNW.fm/Disclaimer
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.
Please see full disclaimers on the NetworkNewsWire website applicable to all content provided by NNW, wherever published or re-published: http://NNW.fm/Disclaimer
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