Name of the Project
Shymanivske iron-ore project.

Location
Ukraine.

Project Owner/s
Black Iron.

Project Description
Black Iron released a positive feasibility study on Shymanivske in 2014. The study was based on the production of 9.9-million tonnes a year of high-grade 68% iron content concentrate.

The company has since completed an order of magnitude study. The study is not National Instrument (NI) 43-101-compliant and was completed to validate management’s belief that the project had maintained its economic viability amid the major changes that had occurred in the iron-ore process and Ukraine exchange rates. Based on the results, Black Iron has decided to commission a new NI 43-101-compliant preliminary economic assessment (PEA).

The new PEA will be based on a scaled-down, yet expandable, design.

Instead of producing 9.9-million tonnes a year, as used in the 2014 feasibility study, the PEA will illustrate the economics of developing the project in several phases, starting with a four-million-tonne-a-year operation. Given the current market and political environment, management feels that the smaller, less capital-intensive project will be better received by investors.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
To be determined.

Capital Expenditure
Phase 1 of Shymanivske will require a capital investment of about $436-million.

Planned Start /End Date
Not stated.

Latest Developments
Black Iron has signed a nonbinding memorandum of understanding with a subsidiary of Glencore, pursuant to which the parties have agreed to engage in formal negotiations to finance the construction of the Shymanivske iron-ore project.

The agreement proposes Glencore making an investment to help fund construction of the project in exchange for securing the offtake of up to the full Phase 1 planned production of four-million tonnes a year.

Black Iron has said that the agreement allows for the allocation of offtake to other equity investors subject to the investment terms offered being equal or superior to those proposed by Glencore. It is also in discussion with other companies that have expressed strong interest in securing supply of the high-grade iron-ore concentrate expected to be produced from the project, in exchange for providing construction financing.

The project will produce pellet feed containing 68% iron. Prices for the premium grade iron-ore have rocketed since the January 25 dam wall burst in Vale, which has impacted on supply.

Key Contracts and Suppliers
Not stated.

On Budget and on Time?
Too early to state.

Contact Details for Project Information
Black Iron, tel +1 416 309 2138 or email info@blackiron.com.