GREY:AXXDF - Post by User
Post by
greenandgoldon Sep 27, 2011 12:37pm
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Post# 19089090
More on Rail
More on Rail"This begs the question, could a 570-km rail line from the mine site near Schefferville to the deep-water port of Sept-Îles be built today given our modern-day multi-level environmental and regulatory hurdles? The short answer is that it would be next to impossible, and the cost would be formidable."
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I took the above quote from an article on LIM, but it applies to every prospective iron ore producer in the Labrador Trough. I think the environmental, regulatory, and capex hurdles are too high to build either a long railway or slurry pipeline to Sept-Iles. Adriana Resources won't be able to complete its long railway. NML won't be able to complete its slurry pipeline.
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What these companies will realize (hopefully not before ADV signs its rail agreement) is that the only sensible path is to scale down their projects and build shorter rail spurs to connect to the QNSL. Even if you only ship 5 million tonnes of ore a year (rather than 20 or 40 million tonnes) you can still make a good profit.
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NML's DSO project looks good, should start shipping next year. LIM's DSO projects are online. Everyone else is fighting for QNSL rail capacity. The losers are going to be worth very, very little.