DGAP-News: Champion Iron Mines Limited: Champion Moving Forward on Feasibility
Study for the Consolidated Fire Lake North Project; Appoints Harry Burgess to
its Board of Directors
DGAP-News: Champion Iron Mines Limited / Key word(s): Study
Champion Iron Mines Limited: Champion Moving Forward on Feasibility
Study for the Consolidated Fire Lake North Project; Appoints Harry
Burgess to its Board of Directors
27.08.2013 / 13:04
Champion Iron Mines Limited
Champion Moving Forward on Feasibility Study for the Consolidated Fire Lake
North Project; Appoints Harry Burgess to its Board of Directors
Toronto (Canada), August 27th, 2013 - CHAMPION IRON MINES LIMITED (TSX:
CHM; OTCQX:CPMNF; FSE: P02) ('Champion', or the 'Company') is pleased to
announce that it is continuing the development of the Fire Lake North
project by resuming activities to finalize the Feasibility Study for the
Consolidated Fire Lake North (CFLN) project in 2014. The Company is also
pleased to announce that Harry Burgess, P. Eng., has joined its Board of
Feasibility Study - Consolidated Fire Lake North
As outlined in the Pre-Feasibility Study (PFS) for the CFLN project that
was completed earlier this year, the main variable requiring additional
study to bring it to the Feasibility Study level was the railway component,
which, at the time, was itself the subject of a feasibility study by CN
In February 2013, CN Rail announced its decision to suspend their Labrador
Trough railway feasibility study, and shortly thereafter Champion curtailed
most of the activities it had been directing towards the CFLN Feasibility
Study, in order to evaluate its options for an alternative rail solution.
Recent discussions with the Québec government on a railway solution for
Northern Québec and the Labrador Trough have been directed towards the
initiation and completion of a 2014 railway Feasibility Study for a
multi-user southern rail route that would link the CFLN project to the
Pointe Noire port area, on the Gulf of St. Lawrence. To prepare for this
scenario, Champion has made the decision to resume its Feasibility Study.
Champion's President and CEO, Tom Larsen, commented, 'Despite the very
challenging market environment, senior management have been able to find
the resources necessary to continue the development of the Consolidated
Fire Lake North project. We are focused on completing the Feasibility Study
for CFLN and believe the financial metrics will be robust.'
With the recent receipt of an advance of $11 million against the claims for
the Québec refundable tax credit on exploration expenditures of $13.5
million for the years ended March 31, 2011 and 2012 (see the Company's July
17, 2013 Press Release), the Company's current cash position is
approximately $15 million. Subject to the completion of audits in
progress, the Company is expecting to receive the remaining $2.5 million of
the Québec refundable tax credit and $1 million with respect to Québec
credit on duties refundable for losses for the year ended March 31, 2011.
CFLN Project Development & Metrics
Champion's PFS indicated the in-pit optimized reserve of 465 million tonnes
(MT) grading 32.4% Total Iron (FeT) could yield 9.3 MT of annual
concentrate production grading 66% FeT. The study indicated at an 8%
discount rate, a Net Present Value of $3.3 Billion, Internal Rate of Return
of 30.9% and Pay Back Period of 3.4 years on Capital expenditures of $1.4
Billion excluding the rail component.
Champion believes it has sufficient resources to ultimately increase
production capacity to more than 20 MT of annual concentrate production
within a few years from initial start of operations at Fire Lake North. The
additional reserves required to support the added production capacity could
come from expansions to each of the West and East pits or development of
the coarse-grained magnetite-rich resources at the Oil Can deposits,
especially the South and East zones, which are located only a few
kilometres from the proposed FLN processing facilities. The Oil Can
deposits could yield low strip ratios as they underlie widely spaced,
near-surface, drill-hole intersections.
Champion is proceeding with additional metallurgical testing of Oil Can
drill core samples and has laid out a drilling programme designed to
delineate sufficient reserves at Oil Can to support a second concentrator
production line at Fire Lake North. If realized, this would bring total
annual capacity to 20 MT. Champion expects to complete a Preliminary
Economic Assessment for the Oil Can deposits that will be incorporated into
the Consolidated Fire Lake North feasibility study.
In the event that a positive decision is taken to build the southern rail
route from Fire Lake North to Pointe Noire, Champion's studies of the
northern route linking Fire Lake North to Bloom Lake will be integrated and
form part of a multi-user railway solution that would service mining
operations and development projects in Northern Québec and Labrador. .
In conjunction with its Feasibility Study, Champion will revise and
complete its environmental and social impact assessment ('ESIA') related to
the first production line. The Company expects to complete the study in
early 2014 for its release to the Québec ministry of Sustainable
Development, Environment, Fauna and Parks (MDDEFP) and to the Canada
Environmental Agency (CEA). Following the public hearing process, the
governmental decree required for project construction is anticipated by the
end of 2014.
Appointment of Harry Burgess to the Company's Board of Directors
The Company is pleased to welcome Mr. Harry Burgess as an independent
member of its Board of Directors. As well, Mr. Burgess has been appointed
as a member of the Company's Audit Committee. Mr. Burgess is an
accomplished professional engineer with global mining experience and is a
founder and associate of Micon International Limited, mineral industry
consultants whose clients include mining and mineral exploration companies,
financial institutions and government agencies from around the world.
About Champion Iron Mines Limited
Champion is an iron exploration and development company with offices in
Montréal and Toronto, and is focused on developing its significant iron
resources in the provinces of Québec and Newfoundland & Labrador. Champion
holds a 100% interest in the Fermont Iron Holdings and a 44% interest in
the Attikamagen Iron Project located in both Québec and Labrador. The
Attikamagen Project is under option to Labec Century Iron Ore Inc.
('Labec'), a subsidiary of Century Iron Mines Corporation, under which
Labec can earn up to a 60% interest.
Champion's Fermont Iron Holdings, including its flagship Consolidated Fire
Lake North Project, are located in Canada's major iron ore producing
district, in close proximity to five producing iron mines, existing
transportation and power infrastructure. Consolidated Fire Lake North is
located immediately north of ArcelorMittal's operating Fire Lake Mine and
60 km south of Cliffs Natural Resources Inc.'s Bloom Lake Mine in
northeastern Québec. Champion's management and advisory board includes
mining and exploration professionals with the mine development and
operations experience to build, commission, and operate the future
Consolidated Fire Lake North mine.
For further information please contact:
Thomas G. Larsen, President and CEO, or Jorge Estepa, Vice President at
Tel: (416) 866-2200.
For additional information on Champion, please visit our website at
This news release includes certain information that may constitute
'forward-looking information' under applicable Canadian securities
legislation. Forward-looking information includes, but is not limited to,
statements about planned operations at the Company's projects, including
its Consolidated Fire Lake North Project. Forward-looking information is
necessarily based upon a number of estimates and assumptions that, while
considered reasonable, are subject to known and unknown risks,
uncertainties, and other factors which may cause the actual results and
future events to differ materially from those expressed or implied by such
forward-looking information, including the risks identified in Champion's
annual information forms, management discussion and analysis and other
securities regulatory filings by Champion on SEDAR (including under the
heading 'Risk Factors' therein). There can be no assurance that such
information will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such forward-looking
information. Accordingly, readers should not place undue reliance on
forward-looking information. All forward-looking information contained in
this press release is given as of the date hereof and is based upon the
opinions and estimates of Champion's management and information available
to management as at the date hereof. Champion disclaims any intention or
obligation to update or revise any forward-looking information, whether as
a result of new information, future events or otherwise, except as required
This press release has been prepared by Champion Iron Mines Limited and no
regulatory authority has approved or disapproved the information contained
End of Corporate News
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