Black Iron (TSX:BKI, StockForum), a Toronto-based iron ore exploration and development firm, released an update to the company's Bankable Feasibility Study (“BFS”) on their Shymanivske Iron Ore Project located in Krivoy Rog, Ukraine.
BFS updates defined an operation capable of producing 9.9 million tonnes of high-grade 68% iron ore concentrate annually, a projected internal rate of return (“IRR”) of 48% and a payback period of two years.
The amended study also pointed out that Shymanivske holds a net present value (“NPV”) of US$3.3 billion at an eight percent discount rate.
Black Iron's main reason behind updating the 2012 study was to add pilot plant test work results from 2013, culminating in an optimum process design and layout with amended infrastructure usage rates confirmed by recent signed protocols of intent.
The company also reported significant changes, moving from dry cobbing to a more efficient wet cobbing that produces an increase from 10% to 40% waste rock rejection before grinding, removing the second stage grinding stage to reduce total operational running power by 14%, optimally decreasing the plant footprint and increasing production to 9.9 million tonnes per year while hardly affecting capital cost.
According to the news release, “The Project has favourable economic potential across a range of discount rates. The operations outlined in this BFS are projected to generate over U.S. $1,216 million in average annual revenue over the life of mine.”
Black Iron was in the news recently when the company secured access to 20m tonnes of annual Ukrainian rail capacity.
Shares bumped 6.52% on the news to $0.245 per share.
Currently there are 141.4m outstanding shares with a market cap of $34.6 million.