Cyclone Metals says Block 103 is the world’s largest undeveloped magnetite iron ore project. Diversified minerals company Cyclone Metals (ASX: CLE) has completed the acquisition of Labrador Iron Pty Ltd which owns the Block 103 magnetite iron ore project in Canada.
The project covers 72.75 square kilometres of acreage in the heart of the Labrador Trough, located 30km from Quebec.
The trough is one of the largest iron ore belts in the world and accounts for 99% of Canada’s iron ore output.
Block 103 is believed to be the largest undeveloped magnetite iron ore deposit in the world and is comparable to other world-class producing assets and large developers.
It has a historical inferred mineral resource of 7,200 million tonnes grading 29.2% iron, based on 4km of a total 12km of geological strike.
Strategic acquisition
Cyclone executive director Tony Sage said the strategic acquisition positions the company alongside other major publicly-listed iron ore players.
“We are very pleased to have acquired such a high-potential project in close proximity to other major iron ore producers and developers in a world class mining province,” he said.
“The geographical position of Block 103 with established infrastructure, services and transport corridors greatly supports the development potential of this asset.”
Share placement
Mr Sage said initial work on the project would be funded by a share placement to existing investors for up to $2 million at an issue price of $0.0025 per share.
Proceeds will also be put towards costs of the acquisition and general working capital.
Historical drilling
Historical drilling at Block 103 totalled 115 holes for 28,021m and identified the Northwest and Greenbush zones of mineralisation.
A 2012 campaign at Greenbush comprised 72 holes for 22,359m, testing mineralisation to a vertical depth of approximately 450m.
The zone is defined as a portion of the Sokoman sequence in the northern part of the project area and encompasses the area of the historic resource estimate.
Global magnetite market
The global magnetite iron ore market was valued at US$23 billion in 2021 and is expected to increase at a compound annual growth rate of 5.43%, reaching US$31.6 billion by 2027.
The product is rapidly being favoured over hematite iron ore for its higher iron content and superior magnetic properties, which help speed up the concentration process required for the production of steel.
Magnetite also contains less impurities than hematite which enables it to be sold to steel manufacturers at a premium price.
The shift towards clean energy and reductions in global carbon emissions are reported to have positioned magnetite ores as more desirable than hematite, and they are expected to play a vital role in further reducing the steel industry’s environmental footprint.