MONTRÉAL, May 17, 2022
/CNW Telbec/ - Champion Iron Limited (TSX: CIA) (ASX: CIA)
(OTCQX: CIAFF) ("Champion" or the "Company") is pleased to announce
that it has entered into a definitive purchase agreement (the
"Purchase Agreement") for the acquisition, via a wholly-owned
subsidiary of Champion, of the Pointe Noire Iron Ore Pelletizing
Facility located in Sept-Iles,
Québec (the "Pellet Plant"). Additionally, Champion announces that
it has entered into a Memorandum of Understanding (the "MOU") with
a major international steelmaker (the "FS Partner") to complete a
feasibility study to evaluate the re-commissioning of the Pellet
Plant and produce Direct Reduction Grade Pellets (the "Feasibility
Study").
Located directly adjacent to the port facilities that Champion
currently uses, the Pellet Plant, which was commissioned in 1965
with an original pelletizing nameplate capacity of 6 million tonnes
per annum, was put on care and maintenance in 2013. The Purchase
Agreement was entered into by a wholly-owned subsidiary of Champion
and provides for the acquisition of the Pellet Plant from Société
Ferroviaire et Portuaire de Pointe-Noire
S.E.C. ("SFPPN") for a cash consideration of $2.5 million, upon satisfaction of certain
conditions precedent. In addition to the cash consideration, the
SFPPN and the region stand to receive additional economic benefits
as Champion considers re-commissioning the Pellet Plant. Benefiting
from its industrial site, strategic location adjacent to
Pointe Noire's deep-water berth and
train unloading infrastructure, the Pellet Plant could provide a
relatively rapid opportunity for commercial production. The Pellet
Plant is expected to require significant investments prior to
re-commissioning, including structural work, rehabilitation and
enhancement of existing equipment, to maximize productivity and
energy efficiencies while minimizing its environmental impact.
The MOU sets out a framework for Champion and the FS Partner to
collaborate to complete the Feasibility Study, which is expected to
be completed in 2023. Subject to positive findings and results of
the Feasibility Study, the MOU outlines a framework for a joint
venture to produce direct reduction grade iron ore pellets for sale
to third parties, including the FS Partner (the "Project").
Pursuant to the Purchase Agreement, Champion is required to comply
with various undertakings in connection with the Pellet Plant,
including a commitment to design and operate the Project using
exclusively green energy sources including electricity, natural
gas, biofuels or renewable energy as main power sources. The
Feasibility Study will evaluate the investments required to
re-commission the Pellet Plant while integrating up to date
pelletizing and processing technologies.
Champion's CEO, Mr. David Cataford, said: "The
proposed acquisition of the Pellet Plant represents a strategic
opportunity for our Company to further deploy its vision to
contribute to the green steelmaking supply chain. Our local
support, high-purity iron ore products, access to world class
infrastructure and operational track record, enabled us to attract
a major international steel producer for a potentially significant
large-scale project in Québec. This project, together with other
opportunities for organic growth, aim to create a positive impact
for local communities and represents an additional step to unlock
the region's full potential, including additional product
processing and transformation, as demand for high-purity iron ore
products rises globally."
All dollar figures stated herein are expressed in Canadian
dollars
About Champion Iron Limited
Champion Iron Limited, through its subsidiary Quebec Iron Ore
Inc., owns and operates the Bloom Lake Mining Complex, located on
the south end of the Labrador Trough, approximately 13 km north
of Fermont, Québec. Bloom Lake is an open-pit operation with
two concentrators that primarily source energy from renewable
hydroelectric power. The Bloom Lake Phase I and Phase II plants
have a combined nameplate capacity of 15 Mtpa and produce a
low contaminant high-grade 66.2% Fe iron ore concentrate with a
proven ability to produce a 67.5% Fe direct reduction quality
concentrate. Bloom Lake's high-grade and low contaminant iron ore
products have attracted a premium to the Platts IODEX 62% Fe iron
ore benchmark. The Company ships iron ore concentrate from Bloom
Lake by rail, to a ship loading port in Sept-Îles, Québec, and
sells its iron ore concentrate to customers globally, including
in China, Japan, the Middle
East, Europe, South
Korea, India and Canada. In addition to the Bloom
Lake Mining Complex, Champion owns a portfolio of exploration and
development projects in the Labrador Trough, including the
Kamistiatusset Project located a few kilometres south-east of Bloom
Lake, and the Consolidated Fire Lake North iron ore project,
located approximately 40 km south of Bloom Lake.
Cautionary Note Regarding Forward-Looking
Statements
This press release includes certain information and statements
that may constitute "forward-looking statements" and
"forward-looking information" under applicable securities laws. All
statements other than statements of historical facts included in
this press release that address future events, developments or
performance that Champion expects to occur, including Management's
expectations regarding (i) the acquisition of the Pellet Plant,
satisfaction of the conditions precedent thereto, expected benefits
of the acquisition, completion of the acquisition and its timing;
(ii) the Pellet Plant re-commissioning, the Project and their
potential, efficiencies, milestones, including completion,
commissioning and commercial production, completion schedule and
required investments; (ii) the Feasibility Study, its completion,
results and expected timeline; (iv) the Company's strategy and
organic growth opportunities; (v) the Company's focus on
sustainability objectives, social matters and governance; (vi)
regional potential and opportunities and (vii) the Company's vision
to contribute to the green steelmaking supply chain and minimize
environmental impact, are forward-looking statements.
Forward-looking statements are statements that are not historical
facts and are generally, but not always, identified by the use of
words such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "continues", "forecasts", "projects",
"predicts", "intends", "anticipates", "aims", "targets" or
"believes", or variations of, or the negatives of, such words and
phrases, or state that certain actions, events or results "may",
"could", "would", "should", "might" or "will" be taken, occur or be
achieved. Although Champion believes the expectations expressed in
such forward-looking statements are based on reasonable
assumptions, such forward-looking statements involve known and
unknown risks, uncertainties and other factors, most of which are
beyond the control of the Company, which may cause the Company's
actual results, performance or achievements to differ materially
from those expressed or implied by such forward-looking statements.
Factors that could cause the actual results to differ materially
from those expressed in forward-looking statements include, without
limitation: the results of feasibility studies; changes in the
assumptions used to prepare feasibility studies; project delays;
continued availability of capital and financing and general
economic, market or business conditions; general economic,
competitive, political and social uncertainties; future prices of
iron ore; future transportation costs, failure of plant, equipment
or processes to operate as anticipated; delays in obtaining
governmental approvals, necessary permitting or in the completion
of development or construction activities; the effects of
catastrophes and public health crises, including impact of COVID-19
on the global economy, the iron ore market and Champion's
operations, as well as those factors discussed in the section
entitled "Risk Factors" of the Company's 2021 Annual Information
Form and the MD&A for the fiscal year ended March 31, 2021, all of which are available on
SEDAR at www.sedar.com, the ASX at www.asx.com.au and the Company's
website at www.championiron.com. 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 of Champion's forward-looking information contained in this
press release is given as of the date hereof or such other date or
dates specified in such statements 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 of its forward-looking
information, whether as a result of new information, future events
or otherwise, except as required by law. If the Company does update
one or more forward-looking statements, no inference should be
drawn that it will make additional updates with respect to those or
other forward-looking statements. Champion cautions that the
foregoing list of risks and uncertainties is not exhaustive.
Investors and others should carefully consider the above factors as
well as the uncertainties they represent and the risks they entail.
Inherent in forward-looking statements are risks, uncertainties and
other factors beyond the Company's ability to predict or
control.
For additional information on Champion Iron Limited, please
visit our website at: www.championiron.com.
This press release has been authorized for release to the market
by the CEO of Champion Iron Limited, David
Cataford.
SOURCE Champion Iron Limited