Saturday 22nd February 2020

Resource Clips


Posts tagged ‘Consolidated Thompson Iron Mines Limited (CLM)’

New stock on the block

October 30th, 2012

Mason Graphite’s grade even surpasses Lac Knife

by Greg Klein

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Graphite’s back in the news with two major announcements, one of which shows a new contender fast approaching Canada’s vanguard of advanced projects. On October 30, the day after Focus Graphite TSXV:FMS released its much-anticipated PEA, Mason Graphite TSXV:LLG hit the world stage—or at least the TSX Venture exchange.

The result of a reverse takeover with a capital pool company, POCML 1 Inc, Mason’s trading debut opened October 30 at $0.90 and dropped to $0.68 before closing at $0.75. The newcomer’s Lac Guéret project in northern Quebec overtakes Focus flagship Lac Knife’s claim to have the highest-known graphite grade.

Mason Graphite’s grade even surpasses Lac Knife

Mason Graphite didn’t begin TSXV trading until October 30
but plans to fast-track its Lac Guéret Project towards production.

The 11,630-hectare Lac Guéret has measured and indicated resources of 7.6 million tonnes grading 20.4% carbon and an inferred resource of 2.76 million tonnes grading 17.29%. CEO Benoit Gascon tells ResourceClips, “I visited many graphite mines that operated or still operate during my 20 years. This one is unique for that level of grade.”

Gascon was president of Stratmin Graphite, former owner of Quebec’s Lac-des-Îles Mine, the largest of Canada’s two producing graphite mines. In 2002 Gascon negotiated Stratmin’s takeover to form Timcal Graphite & Carbon, which now operates the mine. Gascon stayed with Timcal in senior roles.

Mason picked up Lac Guéret earlier this year from Cliffs Natural Resources, which got the property as part of its 2011 acquisition of Consolidated Thompson. The price tag for Mason totals $1.5 million in warrants and $15 million cash, which includes $2.5 million on completing feasibility and another $5 million on beginning commercial production.

Lac Guéret’s resource was calculated last summer, based on 2006 drilling. Any day now an 18,000-metre drill program will wrap up, with one resource update planned for December and another for Q1 2013. December’s also slated for a PEA. Looking further ahead, feasibility is scheduled for Q3 2014 and commercial production in Q4 2015.

As for community relations, the company hopes to have an impact benefit agreement finalized with the Pessamit Innu band by Q3 2013.

Lac Guéret is a flake graphite deposit, says Mason’s corporate development officer Simon Marcotte. Early indications show that “large- and medium-sized flake together is north of 60% [of the resource], but we’re hoping it’ll be more than that. We’ll have a better idea by year-end,” he says.

Marcotte doesn’t understate his optimism about the resource updates. The project will boast “not only the highest grade of graphite in the world but also the biggest deposit by far—no two ways about that—by a very significant margin.”

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The Iron Hub

September 28th, 2011

Alderon Sees Massive Kami Production

By Greg Klein

Something big is happening in Labrador and, according to Alderon Resource TSXV:ADV Executive Chairman Mark Morabito, it’s part of the most underreported story in mining. “Everybody knows Chinese steelmakers want to diversify their iron ore supply away from the Big Three, which are Vale, Rio Tinto and BHP Billiton. So the Chinese are out there making deals with earlier-stage companies. But that’s had a domino effect.”

Morabito explains that as these steelmakers are making these investments and securing future offtake, they’re crowding out their competitors. “They’re forcing the Koreans, Japanese, Turks and Indians into earlier-stage deals as well. So a company like ours has all sorts of future customers it can choose from.”

Alderon Sees Massive Kami Production

As a result, Alderon has signed something like 14 non-disclosure agreements with “primarily Asian steel concerns” interested in its Kamistiatusset Project in Labrador. With iron ore prices projected to stay in the $180-to-$200-a-tonne range and global steelmaking expected to double over 15 to 20 years, Kami’s become a major player in the iron ore boom of the Labrador Trough, which straddles the Quebec-Labrador border.

“There are no other iron ore projects in Canada that can get to production before us,” says Morabito. “We’ve identified a billion-tonne-plus deposit in an area that has low-cost power, right beside a common-carrier railway leading to a port that’s undergoing major expansion. And we’re going to continue our track record of success—we under-promise, we over-deliver, and we’re going to continue doing just that.”

Anyone troubled by the semantic confusion of promising to under-promise might consider Alderon’s ambitious timeline compared to a PEA that can, in retrospect, seem quaint.

Released September 8, it projected a 2.7-year payback on a $989 million CAPEX with a 40.2% pre-tax IRR, a US$3.07 billion NPV discounted at 8% and a total operating cost excluding royalties of US$44.87 per concentrate tonne averaged over a 15.3-year mine life. The study covers rail facilities, port expansion in Sept-Iles and an open pit with concentrator producing 8 million tonnes a year of 65.5% iron.

The PEA was based only on one deposit of 376 million tonnes grading 29.8% iron indicated and 46 million tonnes grading 29.8% inferred.

Just five days later, however, an updated 43-101 reported numbers for all three Kami deposits, boosting the indicated category to 490 million tonnes grading 30% and the inferred to 598 million tonnes grading 30.3%.

But Alderon’s not stopping there, Morabito says. “If we convert all the inferred from the second resource estimate into the indicated, and pick up some additional tonnage, we’re looking at a resource of 1.2 to 1.4 billion tonnes. That would make it bigger than Consolidated Thompson.”

The reigning king of the Labrador Trough, Consolidated Thompson began production last year, quickly doubling its initial 8-million-tonne capacity. Last June, it was bought out by Cliffs Natural Resources for $4.9 billion.

“We’re re-categorizing and upgrading our resource with definition drilling,” Morabito continues. “We’re doing some geotechnical drilling and pit design drilling, but exploration is over.”

We’ve got a mix between operators and mine builders, and it’s a potent mix that gives us a competitive edge. We’re taking this into production ourselves —Mark Morabito

Definition drilling continues until March or April 2012, with feasibility slated for completion in 3Q 2012 and permitting in 3Q 2013. Pilot production begins in 4Q 2014 and commercial production in 2015.

Alderon is part of a pullulating mining camp. Kami is located fewer than seven kilometres from the Bloom Lake Mine that Cliffs recently picked up. Cliffs also runs the nearby 5.5-million-tonne Wabush Mine.

Steelmaking giant ArcelorMittal owns the Mount Wright and Fire Lake mines, which are slated for a $2.1-billion upgrade to raise production from 14 million to 24 million tonnes by 2013.

Iron Ore Company of Canada plans to increase its 17-million-tonne Carol Project to 26 million by 2013. Additionally, there’s talk of 50 million tonnes by 2016. Rio Tinto holds 58.7% of IOC, with Mitsubishi Corp holding another 26.2%.

When it comes to talk of Alderon’s management, Morabito’s enthusiasm overcomes his modesty. “We’ve got the best team of any development-stage iron-ore project in the world, I think,” he says. “I secured the project originally. Directors Stan Bharti and Bruce Humphrey were two principals with Consolidated Thompson; so we joined up and brought together people who’ve been working in Newfoundland and Labrador for years.”

IOC alumni now working with Alderon include President/CEO Tayfun Eldem and COO Brian Penney and Directors David Porter and Matt Simpson. “Our Executive VP of Environmental and Aboriginal Affairs is Todd Burlingame,” Morabito adds. “His last big permitting project was the Lower Churchill hydro project, 3,000 megawatts and right in the same area with all the same stakeholders. Gary Norris was the former head of the Newfoundland civil service; he’s our VP of Government and Community Affairs. Our chief geologist, Ed Lyons, was chief geologist of Consolidated Thompson and Director Brad Boland was its CFO.”

“So we’ve got a mix of operators and mine builders, and it’s a potent mix that gives us a competitive edge,” Morabito says. “We’re taking this into production ourselves.”

Alderon is backed by Forbes & Manhattan, the merchant bank that helped steer Consolidated Thompson through the 2008 crisis.

At press time, Alderon had 82.7 million shares trading at $2.55 for a market cap of $210.9 million. As of September 22 insiders held 11.9%; Altius Minerals TSX:ALS held 39.3%; and the company had working capital of $16.2 million.

Consolidated Thompson to be bought by Cliffs for $4.9B

January 12th, 2011

Consolidated Thompson Iron Mines Limited CLM:CA announced that it has entered into a definitive agreement whereby Cliffs Natural Resources Inc CLF will acquire all outstanding shares of Consolidated Thompson at $17.25 per share—a premium of 30%—valuing the company at approximately $4.9 billion. Consolidated Thompson has determined that the arrangement is in the company’s best interests and will recommend that shareholders vote in favour of it.

Executive Chairman/President/CEO Brian Tobin commented, “The success we have had is a testament to our partners, employees and management team and their endeavors to deliver superior shareholder value. We are delighted that a company of the financial and technical strength of Cliffs, with considerable nearby infrastructure and experience in the Labrador Trough, is going to take our world-class mine and projects to the next stage. The Board of Directors believes this is a very attractive transaction for our shareholders.”

View Company Profile

Contact:
Brian V. Tobin
Executive Chairman, President/CEO
514.396.6345

or Francois Laurin
CFO
514.396.6345

by Ted Niles