An iron ore exploration company operating in northwestern Ontario has announced a sizeable order from China.
Northern Iron Corporation has an order from China Railway Materials Import and Export Company for 900,000 tonnes of Hot Briquetted Iron (HBI) to be delivered in 2016.
In a May 23 release, Northern president and CEO Basil Botha said the China Railway order takes up two thirds of his company's anticipated annual production of HBI.
Payment for the order will be secured by an irrevocable letter of credit from the prime bank of the People's Republic of China. The company said China Railway is one of China's largest commodity buyers.
Northern Iron is advancing a northwestern Ontario iron ore deposit near Ear Falls in the Red Lake mining district.
Its 14,672-hectare property includes the former Griffith Mine, once owned by Stelco, and four satellite exploration properties.
With production plans slated for late 2015, the company has plans to build a processing mill that makes HBI for the steel industry.
“Our team has worked extremely hard to secure this off-take agreement for HBI and will continue to work with a number of international companies who could potentially become suitable joint venture partners,” said Botha in a statement.
Botha has previously stated power requirements are a factor in whether the Vancouver miner plans to locate the processor in the area.
The Red Lake mining camp is served by a 115 kV transmission line, which is considered inadequate for his needs and those of the nearby gold companies operating and expanded in the district.
In a statement, the company warned a project feasibility study has not been completed and “there is no certainty the proposed operation will be economically viable.”