Baffinland Iron Mines Corporation

Baffinland Iron Mines Corporation

March 07, 2005 17:00 ET

Baffinland Announces Initial Metallurgical Test Results


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: BAFFINLAND IRON MINES CORPORATION

TSX VENTURE SYMBOL: BIM

MARCH 7, 2005 - 17:00 ET

Baffinland Announces Initial Metallurgical Test Results

TORONTO, ONTARIO--(CCNMatthews - March 07, 2005) - Baffinland Iron Mines
Corporation (TSX VENTURE:BIM) ("Baffinland" or the "Company") announces
initial metallurgical testwork completed on drill core composites from
its 2004 advanced exploration program. Approximately 2.8 tonnes of drill
core in 20 composite samples from Deposit No 1 were sent to Studien
Gesellschaft fur Eisenerz-Aufbereitung (SGA) in Germany for
metallurgical testwork essential for evaluation of potential iron ore
sale products to the steel industry. Of the 20 samples, Relative
Reducibility (ISO Standard 7215 Test) has been completed on 9 of the
samples to date.

Results for the first 9 samples are as follows:



---------------------------------------------------------------------
Reduction
Test
Composite (ISO 7215) Fe Magnetite SiO2 Al2O3 P S Drill
Sample # RI % % % % % % % Hole #
---------------------------------------------------------------------
---------------------------------------------------------------------
less
than
2 54.3 69.22 18 0.69 0.44 0.012 0.005 37
---------------------------------------------------------------------
5 34.5 64.58 45 7.04 0.64 0.010 0.170 37
---------------------------------------------------------------------
7 42.4 68.74 12 0.33 0.30 0.017 0.077 37
---------------------------------------------------------------------
10 33.4 64.01 49 6.96 0.75 0.030 0.280 39
---------------------------------------------------------------------
less
than
13 53.5 66.55 17 2.16 0.82 0.107 0.005 44
---------------------------------------------------------------------
14 56.2 65.66 4 1.89 0.68 0.117 0.006 44
---------------------------------------------------------------------
15 49.9 62.43 8 4.75 1.29 0.097 0.005 44
---------------------------------------------------------------------
16 48.1 65.70 75 0.43 0.70 0.012 0.260 34
---------------------------------------------------------------------
17 46.3 62.14 88 2.46 1.45 0.039 0.450 34
---------------------------------------------------------------------


Michael Zurowski, President of Baffinland stated that "The results are
very encouraging with seven of the nine samples showing acceptable to
excellent reducibility." Two samples (#5 and #10) exhibit marginal
reducibility. A very positive result for reducibility was determined for
samples #16 and #17. These samples have a high lump potential despite
the high magnetite content. Mr. Zurowski went on to state that "It was
expected, due to historic testwork completed in the 1960's and 1970's,
that sections of Deposit No. 1 with hematite dominant mineralization
would be a high quality lump product, however the indicated lump
potential of the magnetite rich portions of the Deposit are extremely
encouraging and also indicative of a high quality lump deposit as well."

The Relative Reducibility Test is designed to measure how the blast
furnace converts iron oxide to relatively pure iron by a series of
reduction reactions. The samples were selected based only upon the
magnetite content (0-20%; 20-40%; 40-60%; 60-80%; and 80-100% magnetite)
of the drill core to determine how the magnetite affects reducibility
and potential as lump iron ore. The reason for the selection was
negative conclusions drawn in Baffinland's 43-101 qualifying report,
written by Strathcona Mineral Services, December 2003, due to low
reducibility in a surface magnetite sample. Reducibility is dependent
upon porosity, permeability, grain size, mineralogy and iron content.
Baffinland, like any new iron ore producer, will require considerable
metallurgical testwork to define the characteristics of their sale
products over the long-term.

Acceptable reducibility is an essential component for the determination
of lump iron ore, which is a sized direct charge to the blast furnace
and commands an approximate 27% premium in price to that of sinter feed.
There are more than 63 separate standard tests specific to iron ore set
by the International Standard Organisation. The initial twenty samples
will establish the general characteristics of the deposit and determine
which specific tests are required to determine consistency and
predictability of any potential sale product. Although further testing
is required, Baffinland is very encouraged by the results and believes
that they confirm the high quality lump potential of the deposit.

Drilling at Deposit No. 1 in 2004 totalled 2,814 metres of large
diameter core in 15 holes. Testwork on the phosphorous content has been
completed and the average phosphorus content of the intercepts released
previously is 0.052% P. This is somewhat higher than the phosphorus
content calculated historically in the 1960's, but still within the
limits of a high quality lump ore product. An indicated resource at
Deposit No. 1 contains approximately 116.7 million tonnes grading 68.3%
Fe, 0.8% SiO2, 0.03% S and 0.03% P. In addition, a separate high sulphur
resource contains 26.9 million tonnes grading 62.8% Fe, 3.8% SiO2, 0.43%
S and 0.03% P. The 2004 drill results are not included in this estimate.
However, the 2004 program has more than doubled the drill-indicated
strike length of Deposit No 1 to over 2.5 kilometres and confirmed the
depth extent to more than 400 metres below the ridge of the Deposit.
Further the discovery of the new Upper Zone parallel to the southeast
limb has significantly increased the average width.

Gordon McCreary, Chairman and CEO of Baffinland said, "These initial
metallurgical test results, when combined with the assay results
released in late 2004, are supportive of the Company's view that Deposit
No. 1 has the potential to become a significant lump iron ore producer."
As stated in previous Baffinland press releases, the objective of the
2004 and 2005 programs is to delineate a substantial resource to support
a direct-shipping iron ore operation focused on European markets with a
production rate of approximately 10 million tonnes per year.
Justification for such an operation would require an approximate
doubling of the tonnage of the resources delineated in the 1960's at a
comparable grade and with comparable metallurgical attributes. Mr.
McCreary stated further that, "The exploration and metallurgical results
to date are supportive of a large direct-shipping ore operation with a
majority of the production being in the form of lump iron ore that
traditionally commands an approximate 27% premium price to fines."

The testwork includes physical (tumble strength, abrasiveness, size
distribution, etc.) and metallurgical (analysis, reduction under load,
softening, dripping and melting in the REAS test, decrepitation, etc.)
testwork. After complete receipt of the initial results, an additional
50 to 60 samples will be submitted for continued metallurgical testing.
The initial results will determine specific parameters for the
additional metallurgical testing, however, the samples will be based
upon an anticipated mine plan rather than strictly mineralogy of
hematite/magnetite content.

Testwork continues at SGA under the direct supervision of Dr Volker
Ritz, Managing Director of the facility and who has approved the
contents of this press release specifically relating to the
metallurgical testwork. SGA has 83-years experience as a research centre
for iron ore beneficiation, agglomeration and metallurgical testing of
burden materials and mineral processing of raw materials for the Iron
and Steel Industry and is owned by six European steel mills. Dr. Ritz
stated that, "The initial results of the comprehensive metallurgical
testwork being performed by SGA on the Baffinland composite samples is
very encouraging regarding the quality lump ore potential of
Baffinland's Mary River Project".

The press release has been prepared under the supervision of Michael T.
Zurowski, P. Eng., a Qualified Person as defined by National Instrument
43-101. The reserve figure quoted in the text of this press release is a
historical resource estimate, by Watts Griffis and McOuat Limited in the
1960's, containing approximately 116.7 million tonnes grading 68.3% Fe,
0.8% SiO2, 0.03% S and 0.03% P. Management believes that the historical
estimate is relevant and conforms to an indicated resource under NI
43-101.

Certain information in this press release may contain forward-looking
statements. This information is based on current expectations that are
subject to significant risks and uncertainties that are difficult to
predict, including risks relating to the exploration and development of
the Company's iron ore deposits. Actual results might differ materially
from results suggested in any forward-looking statements. The Company
assumes no obligation to update the forward-looking statements, or to
update the reasons why actual results could differ from those reflected
in the forward-looking statements. Additional information identifying
risks and uncertainties is contained in the Company's filings with the
Canadian securities regulators, which filings are available at
www.sedar.com.

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Baffinland Iron Mines Corporation
    Gordon A. McCreary
    Chairman & CEO
    (416) 364-8820
    or
    Baffinland Iron Mines Corporation
    Michael T. Zurowski
    President
    (416) 364-8820
    info@baffinland.com
    www.baffinland.com
    THE TSX VENTURE EXCHANGE INC. HAS NEITHER APPROVED NOR DISAPPROVED THE
    CONTENTS OF THIS PRESS RELEASE.