TSX- and ASX-listed Champion Iron produced just over eight-million wet metric tonnes (wmt) of high-grade 66.4% iron-ore concentrate for the financial year ended March 31, compared with just over 7.9-million wmt for the same period in 2020.

This resulted in a stable recovery rate of 82.6% for the three months ended March 31, compared with 82.3% for the same period in 2020.

The company is also in the process of producing an additional 374 400 wmt of direct reduction quality iron-ore concentrate, with a grading of 67.6% iron with a combined silica and alumina content of 2.8%.

In terms of financials, cash on hand and restricted cash for the company totalled $680.5-million as at March 31, compared with $298.7-million as at March 31, 2020.

The company has available liquidity for the upcoming income and mining taxes payments, it confirmed, noting that these total about $195-million, which is due in May.

Champion also made a full repayment of the $20-million revolving credit facility on March 30, bringing the total undrawn and available credit facilities to $220-million.

BLOOM LAKE PHASE 2 UPDATE

Meanwhile, construction work at the company’s Bloom Lake project, in Canada, is progressing as planned, with more than 200 individuals actively working on the Phase 2 project, which is expected to be completed by mid-2022.

Agreements to expand the existing long-term rail contract with Quebec North Shore and Labrador Railway to support the expected Phase 2 production volumes are also under way.

Champion confirmed on April 28 that the Phase 2 expansion project is expected to double Bloom Lake’s nameplate capacity to 15-million tonnes a year upon its scheduled completion in mid-2022.

OPERATIONAL PERFORMANCE

In terms of operational performance, early actions implemented by the company in response to the Covid-19 pandemic minimised impacts on the company and its operations, and despite disruptions to operations in the first quarter of the fiscal year ended March 31, Champion was able to set a new yearly record production of eight-million wmt of high-grade iron-ore concentrate.

During the three-month period ended March 31, more than 9.4-million tonnes of material were mined and hauled, compared with almost 8.6-million tonnes for the same period in 2020, an increase of 10%. This increase in material mined and hauled is attributable to the company's ongoing mining equipment rebuild programme, which provided a higher equipment use rate and additional equipment availability.

The higher volume mined is also attributable to the commissioning of an additional haul truck during the financial year under review.

The strip ratio increased to 0.67 for the three-month period ended March 31, compared with 0.59 for the same period in 2020. Although the strip ratio is in line with the yearly mine plan, it was negatively impacted on by the company's efforts to recover the waste backlog accumulated during the first quarter of the 2021 fiscal year, when Champion's operations were disrupted by the government's imposed Covid-19 directives.

The Bloom Lake plant processed 5.2-million tonnes of ore during the three-month period ended March 31, compared with more than 4.8-million tonnes for the same period in 2020, representing an increase of 7%. The higher throughput resulted from higher mined ore availability and a higher mill utilization rate.

The continuous improvements and operational innovations allowed the company to increase throughput stability and reach a higher level of mill productivity, despite the inefficiencies created by Covid-19, enabling the company to capitalise on elevated iron-ore prices.

The iron-ore head grade in the three-month period ended March 31, was 30.7%, compared with 31.7% for the same period in 2020. The decrease in head grade is attributable to the presence of some lower-grade ore being sourced and blended from different pits when compared with the prior year, which is in line with the mining plan and the life-of-mine head grade average.

KAMI PROJECT ACQUISITION

The acquisition of the Kamistiatusset (Kami) iron-ore project and its related mining properties on April 1, 2021, and the initiation of work related to revising the project’s feasibility study, is under way as the company evaluates growth alternatives within its portfolio, it said in a statement on April 28.

The acquisition consisted of $15-million in cash, the extinguishment of about $19.4-million of Alderon’s secure debt and an undertaking in favour of the receiver to make a finite production payment on a fixed amount of future iron-ore concentrate production from the Kami project.

In connection to the acquisition, Champion bought the secured debt from Sprott Private Resource Lending, which was extinguished for an aggregate consideration of 4.2-million tonnes of Champion’s ordinary shares issued to Sprott and Altius Resources, who held a participation in the secured debt.