TORONTO (miningweekly.com) – Canadian iron-ore project developer Champion Iron Mines on Wednesday said that it continued to participate with the Quebec government in advancing a multi-user railway solution it needs to ship iron-ore from its flagship Consolidated Fire Lake North (CFLN) project, located in the Fermont iron-ore district.

The TSX-listed firm said that while it was moving forward with a feasibility study for the project, which was expected to be complete by year-end, negotiations were ongoing between government, mine developers and producers in the Labrador Trough to build a railway to connect them with the Port of Sept-Ile’s C$220-million new multi-user ship-loading facilities at Pointe Noire.

“This remains Champion’s preferred railway and port solution following evaluation and consideration of alternatives, including several independent rail options to Pointe Noire and alternatives to access Baie-Comeau,” the company said.

Canadian National Railway (CN) last year shelved the feasibility study for the construction of its proposed C$5-billion rail line and terminal handling facility to serve the Quebec/Labrador iron-ore range, owing to adverse market realities forcing project developers to defer expected project start-ups.

The feasibility study was started in August 2012 by CN and its partner La Caisse de dépôt et placement du Québec (the Caisse), along with a group of six mining companies.

CN had won backing from a group of mining companies to study the feasibility of a proposed rail link in northern Quebec to ship iron-ore from the isolated region. Among the miners that participated in the study were Cliffs Natural Resources, Labrador Iron Mines Holdings, New Millennium Iron, Alderon Iron Ore and Cap-Ex Ventures.

A joint review of the project, together with the mining companies, had indicated that mine construction schedules and diverging needs for each specific individual project would make it difficult to obtain the critical volumes of iron-ore necessary to support the building of new rail and terminal infrastructure by CN.

FEASIBILITY STUDY

Champion said that its CFLN project hosted enough iron-ore resources to potentially support output of more than 20-million tonnes a year of iron concentrate. However, the company said that it remained focused on an initial ten-million-tonne-a-year operation for the feasibility study.

Toronto-based Champion said that it was still tinkering with elements of the study.

It envisions using a single initial concentrator production line producing 66% iron concentrate, as in the prefeasibility study. However, one main flow sheet design change might be to use two slightly smaller autogenous grinding (AG) mills in-place of a single large AG mill to reduce output loss from the mill owing to downtime for maintenance or a potential failure.

The company was testing the potential to raise mill recovery above the 82%-level typical of the Fermont area. The optimisation uses new technology for iron fines recovery that recently became more economic with the unprecedented price range for iron and the developing market for iron-ore fines.

“Favourable results could have a significant positive impact on the economics of the project,” Champion said.

Further, investigations were also evaluating improved filtration techniques and ‘dry stacking’ of tailings, a more cost-efficient method of tailings disposal that could also reduce the physical footprint and environmental impact of CFLN’s planned operations. Filtered tailings water would be recirculated within the concentrator, and the dry tails would possibly be conveyed to impoundment areas within the waste rock dumps.

Meanwhile Champion had secured all required permits for preconstruction activities in order to build an 800-worker construction camp, the 161/34.5 kV substation and a 34.5 kV power line that would feed the construction camp and eventually the construction site. These facilities could be operational for construction workers at the time the CFLN certificate of authorization approval is received from the Quebec government.

"We are moving forward rapidly with the remaining drilling and testwork required to complete the feasibility study by year end. The current work programmes are expected to yield enhancements in design that will have significant positive impact on the project economics and social acceptability,” champion CEO Thomas Larsen said.