Annual Meeting of Shareholders Chairman's Update Voting Results at AGM
10/20/2021 4:29:00 PM
Toronto, Ontario--(Newsfile Corp. - October 20, 2021) - Labrador Iron Mines Holdings Limited (OTC Pink: LBRMF) ("LIMH" or the "Company") held its Annual Meeting of Shareholders today in Toronto, Canada.
CHAIRMAN'S UPDATE
At the Annual Meeting, John F. Kearney, Chairman and Chief Executive Officer, provided the following update.
"The Company's current focus is advancing the Houston Project, which is our flagship property.
The Houston Project is an open pit direct shipping iron ore project, on which an updated, independent Preliminary Economic Assessment was completed in February 2021, and demonstrated production of 2 million tonnes of iron ore per year, with an initial 12-year mine life, for total production of 23.4 million tonnes over the life of the mine.
The PEA estimates initial direct capital costs of $51.3 million, and along with indirect costs, total initial capital expenditures of $86.8 million.
The Company is advancing development of the Houston Project through a number of initiatives, including the following:
discussing an off-take agreement, including construction financing and product sale components with a potential off-take partner;
advancing commercial negotiations with construction contractors, equipment vendors, rail, port and logistics counterparties; and
planning metallurgical test work of drill core collected from the Houston Project in a 2013 bulk sample. Results of the test work will be used to refine the product specifications and process flowsheet. This analysis will yield important product characterization information which will be helpful in marketing the iron ore product.
In pursuing potential off-take and financing arrangements, the Company has been in discussion with an iron ore trader which have advanced to the stage of a draft Memorandum of Understanding, which contemplates due diligence collaboration, an off-take option, and potential pre-pay financing in order to move the Houston Project forward.
In order to fund these initiatives, the Company is exploring various near term working capital financing alternatives, including a potential private placement of equity of approximately $2.5 to $5 million.
Various future construction financing alternatives being considered for 2022 include:
an advance payment component of an off-take agreement;
equipment leasing arrangements;
potential project partners;
potential government development agencies participation; and
potential debt and equity financing.
Meanwhile, LIM continues to conduct the expenditures required to maintain its various mineral claims in good standing. The former James Mine and the Silver Yards processing facility have been in progressive reclamation since the termination of mining at the James Mine at the end of 2013.
A final rehabilitation program, primarily involving some repeat seeding and re-vegetation and removal of discharge piping, was completed during the summer of 2021.
LIM has now completed all its environmental regulatory requirements relating to rehabilitation of the former James Mine, Redmond Mine and the Silver Yards processing site and related infrastructure.
The price of iron ore surged to an all-time record US$235 per tonne in May, before retrenching to the current US$125 per tonne range. It was to be expected that the price increase over the past year would see contraction. It is notable that the current iron ore price, after the recent retraction, is still some US$35 above the assumed long term price used in the economic assumptions in the PEA of the Houston Project.
Iron ore demand in China has proven to be extremely strong, as stimulus programs have been driving a robust economic recovery and continued strength in Chinese steel production. Covid relief programs and infrastructure investment worldwide are expected to create continued demand for steel. Economic developments in China will continue to be a major factor in the price of iron ore over the longer term. Notwithstanding a mid-summer slowdown, and negativity surrounding property developer Evergrande, Chinese demand for iron ore is expected to remain strong."
LABRADOR IRON MINES HOLDINGS LIMITED AGM
Election of Directors
All nominees for election as directors: Messrs. John F. Kearney, William Hooley, Matthew Coon Come, Eric Cunningham, Gerald Gauthier, Brendan Lynch and Danesh Varma, were unanimously re-elected as directors, to serve until the next annual general meeting of shareholders or until their successors are elected or appointed.
The detailed results of the proxies submitted on the vote on the election of directors are as follows: