Mr. Tayfun Eldem reports
ALDERON FILES NI 43-101 UPDATED FEASIBILITY STUDY TECHNICAL REPORT FOR THE KAMI PROJECT ON SEDAR
Alderon Iron Ore Corp. has filed, on SEDAR, a National Instrument 43-101 technical report entitled, "Updated Feasibility Study of the Kamistiatusset (Kami) Iron Ore Property, Labrador," with the effective date of Sept. 26, 2018. This feasibility study is an update to the feasibility study on the Kami iron ore project that was issued on Jan. 16, 2013.
The updated feasibility study was completed by BBA Inc. from Montreal, Que. The updated feasibility study once again demonstrates the strong economics of the Kami project, which will produce a premium-quality iron ore concentrate with higher iron content and ultralow impurities relative to the grade benchmark of 62 per cent iron. Coupled with the sustained demand for high-grade iron ores, the robust project economics form the foundation of Alderon Iron Ore's relaunch of its project financing efforts.
The updated feasibility study replaces the company's November, 2017, preliminary economic assessment as the current technical report on the Kami project.
The results of the updated feasibility study are based on 100-per-cent ownership of the Kami project. The Kami project is held through The Kami LP, 75 per cent held by Alderon Iron Ore and 25 per cent held by HBIS Group Co. Ltd. The results of the updated feasibility study disclosed in this news release are expressed in U.S. dollars and pretax (except where otherwise indicated).
HIGHLIGHTS OF THE UPDATED SEPTEMBER, 2018, FEASIBILITY STUDY
Net present value at 8% discount rate $1,698M
Internal rate of return 24.6%
Projected years to payback Four years
Total estimated capital cost (excluding
sustaining capital and closure costs) $982.41M
Average estimated operating costs (loaded
in ship Port of Sept-Iles) $30.72/dmt
CFR concentrate sales price forecast -- based
on three-year trailing average CFR benchmark
price of $63.30/dmt at 62% Fe, adjusted for Kami Fe
grade, and HBIS and Glencore agreement terms $89.67/dmt CFR (FOB $73.17)
Estimated mine life 23 years
Final product iron grade 65.2%
Proven and probable mineral reserves (COG -- 15%,
28.8% total Fe, 3.4% dilution, 2.5% ore loss) 517.2 Mt
Annual concentrate production rate (average
life of mine, postramp-up year) 7.84 Mtpa
Technical report and qualified person
The technical report was prepared under the supervision of Angelo Grandillo, PEng, of BBA, a qualified person as defined by NI 43-101, with contributions from Jeffrey Cassoff, PEng, of BBA, James Powell of Gemtec, Peter Merry of Golder and Mr. Kociumbas. Mr. Grandillo is a qualified person as defined by NI 43-101 and is independent of Alderon. Mr. Grandillo has reviewed and approved the technical information contained in this news release, with the exception of the mineral resource estimate which was reviewed and approved by Mr. Kociumbas and the mineral reserve estimate which has been reviewed and approved by Mr. Cassoff, as noted above. Mr. Grandillo has verified all the data underlying the technical information disclosed in this news release.
For further information on the Kami project, please refer to the technical report entitled, "Updated Feasibility Study of the Kamistiatusset (Kami) Iron Ore Property, Labrador," with the effective date of Sept. 26, 2018, which is available on SEDAR.
About Alderon Iron Ore Corp.
Alderon Iron Ore is a leading iron ore development company in Canada. The Kami project, owned 75 per cent by Alderon Iron Ore and 25 per cent by HBIS through the Kami Mine partnership, is located within Canada's premier iron ore district, the Labrador Trough, and is surrounded by three producing iron ore mines. Its port handling facilities are located in Sept-Iles, the leading iron ore port in North America. HBIS is Alderon Iron Ore's strategic partner in the development of the Kami project and China's second-largest steel producer.
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