MONTREAL (miningweekly.com) – Despite the price outlook for the steelmaking ingredient iron-ore crawling sideways at best in 2016, TSX- and ASX-listed junior Champion Iron is preparing to restart its recently acquired Bloom Lake mine, near Fermont, Quebec, as soon as markets improve.
Under the leadership of chairperson and CEO Michael O’Keeffe, Champion subsidiary Quebec Iron Ore had on April 11 closed the C$10.5-million acquisition of Cliffs Natural Resources’ Bloom Lake assets and the Quinto claims, located opposite its flagship Fire Lake iron-ore project in the famous high-grade Labrador Trough mining district, straddling the provincial borders of Newfoundland and Quebec.
In contrast, Cliffs had in 2011 bought the mine for about C$4.9-billion from Consolidated Thompson. Under the acquisition, Quebec Iron Ore became responsible for environmental obligations that included environmental reclamation liabilities, which the Quebec government estimated to be about C$41.7-million.
It was also responsible for replacing bonds securing certain obligations of Bloom Lake totalling about C$1.1-million. On a sponsored tour of the more than 45 km2 Bloom Lake property this week, Mining Weekly Online observed significant infrastructure in place that would make for a rapid restart when a market recovery had gathered pace.
Bloom Lake had been placed on care and maintenance since December 2014, when the mine could not compete with collapsed ore prices, which fell from a record high of $180/t to $50/t three years ago. Cliffs had placed Bloom Lake and several other associated subsidiaries under Companies’ Creditors Arrangement Act (CCAA) protection in January 2015, in an effort to try isolate losses and protect shareholders.
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