Company is meeting targets for development of Kami iron ore mine
President and CEO of Alderon Iron Ore Tayfun Eldem speaks with The Telegram at the Sheraton Newfoundland Wednesday. — Photo by Keith Gosse/The Telegram
The president and CEO of Alderon Iron Ore, Tayfun Eldem, says the company is poised to become the next major iron ore producer out of Canada.
That assumes all of the pieces required for development of its Kami iron ore mine site, near Labrador City-Wabush, continue falling into place.
One required piece is power. When Alderon’s executive chairman, Mark Morabito, spoke with reporters about the project in early June, he labelled power as the biggest issue for the project.
The company submitted a formal request for power to Nalcor Energy at the end of 2011, Eldem said Wednesday, speaking with The Telegram outside a Mining Industry NL’s investor forum presentation room at the Sheraton Hotel.
That application is still being assessed.
“We continue to work with Nalcor. Nalcor follows a very prescriptive, three-stage process in terms of project development. We’ve finished Stage 2,” Eldem said, explaining he expects the work to last another 90 days.
“What they’re doing right now is they’re trying to assess (first): is the power available — in terms of energy — which I think that they’re confident that they can supply the energy. And the second piece is: does the transmission infrastructure need any upgrades?”
The debate around the Lower Churchill development at Muskrat Falls has included discussion of whether the project would be used to supply power to mining projects in the iron ore-rich Labrador Trough.
“They now have a very clear idea of what it’s going to take for them to bring power to our site,” Eldem said.
“They’re moving into Stage 3, which then looks at what aspects they need to look at in terms of technical permitting, engagement and they’re about to start that process. At the end of that, then we’re going to go into a power purchase agreement with Nalcor.”
Power supply is not the only item the Alderon team has been working to put in place.
Alderon staff are finishing the project’s feasibility study — expanding, in detail, upon the preliminary economic assessment for the project. The feasibility study is expected to be released publicly next month.
Within two weeks, Eldem said, the company will submit an environmental impact statement for the project. The major document will detail the mining project for regulators and, again, be publicly available.
“We expect to be cleared from environmental assessment towards the end of next year,” he said.
At the same time, aboriginal consultations are ongoing with five separate groups — three based in Quebec and two in Newfoundland and Labrador.
“Those discussions are going very well,” Eldem said, adding impact benefit agreements may come into play.
The company hopes for a decision to come out of the environmental assessment as early as October 2013.
An approval would allow major construction to start.
“We are essentially executing the plan we set out for ourselves and we continue to hit every milestone as we’ve laid out,” Eldem said, adding he felt it was important to note the company has officially opened its Labrador City office and now has a senior manager based there, focused on developing a labour base for the project.
The aim of the company is to move the mine project into production by the end of 2015.
As for financing, the company is partnered with Altius, Hebei Iron and Steel, and Liberty Metals and Mining, a division of Liberty Mutual.
If approved, the company hopes to produce 16 million metric tonnes of iron ore a year from Kami.