PERTH (miningweekly.com) – The Quebec Superior Court has approved ASX- and TSX-listed Champion Iron’s C$10.5-million buy of the Bloom Lake mine and related rail assets.
In December last year, Champion inked an asset purchase agreement with Cliffs Natural Resources to buy the Bloom Lake mine.
Under terms of the asset purchase agreement, Champion subsidiary Québec Iron Ore would also become responsible for environmental obligations that included environmental reclamation liabilities, which the Quebec government estimated to be about C$41.7-million, as well as for replacing certain bonds securing certain obligations of Bloom Lake totalling about C$1.1-million.
With the Quebec Superior Court approving the deal, the acquisition was expected to be completed later this quarter, subject to certain closing conditions.
“Bloom Lake represents strong upside potential for our shareholders to leverage the significant level of investment in Bloom Lake made by previous owners, and which we are expecting to acquire at very favourable terms, pursuant to the assent purchase agreement, especially when considering original costs,” said Champion chairperson and CEO Michael O’Keeffe.
He added that the mine also had important potential to add to economic growth in the region.
“Champion plans to acquire the Bloom Lake mine because we believe it is an asset of global significance. We think it could potentially become one of the lowest capital cost iron-ore mines in the world, even following an extended care and maintenance, and the planned upgrade period.”
Champion has already identified the potential to improve mine capacity at Bloom Lake, O’Keeffe added, noting that previous operations had historically produced at a yearly maximum of six-million tonnes a year of iron-ore fines, at 66% iron.
Champion would look to increase this to over seven-million tonnes a year, at a similar grade, chiefly through the implementation of a new mine plan, as well as improved recoveries.