Baffinland Iron Mines Corporation

Baffinland Iron Mines Corporation

June 10, 2010 16:15 ET

Baffinland Reviews Early Stage Production via Road Haulage and Accelerates Completion of Draft Environmental Impact Statement

TORONTO, ONTARIO--(Marketwire - June 10, 2010) - Baffinland Iron Mines Corporation (TSX:BIM) ("Baffinland" or the "Company") announces that it is reviewing a road haulage option that would result in early stage iron ore production while the Company continues to pursue the development of the Steensby Inlet Port and Rail Project ("Rail Project"). The Company completed a Rail Project definitive feasibility study ("Rail DFS") in 2008 for an 18 million tonne per annum operation.

The Company is examining mining, road haulage along the existing 99 km Milne Inlet tote road and shipping using market vessels during an approximate 90-day (August through October) open water season in Milne Inlet. Mining and shipping targets between 2 and 5 million tonnes of lump and fine iron ore per annum are being evaluated with an estimated optimized production rate of approximately 3 million tonnes per annum. Output is expected to be similar to that identified in the Rail Project DFS with 75% high quality lump iron ore and 25% premium quality fine iron ore (sinter feed). Baffinland's lump and fine iron ores are expected to grade greater than 66% iron over the first ten years of production. Consensus analyst estimates of iron ore prices would see Baffinland average $130 to $150 per tonne of output within the first three to five years of production from the road haulage operation. 

The Company also plans to accelerate the completion of its Draft Environmental Impact Statement in 2010 to work towards the completion of the full environmental assessment and permitting process by late 2012 to early 2013.

"Achieving early stage production through this road haulage option would enhance value for Baffinland's shareholders, achieve cashflow during a period when iron ore prices are forecast to continue to be high and strengthen our efforts to achieve the full development of the Rail Project" stated Daniella Dimitrov, Baffinland's Vice Chair.

This review is being supervised by Michael T. Zurowski, P. Eng., a Qualified Person as defined by National Instrument 43-101.

Baffinland is a Canadian publicly-traded junior mining company that is focused on its wholly-owned Mary River iron ore deposits located on Baffin Island, Nunavut Territory, Canada. Baffinland's shares trade on the Toronto Stock Exchange under the trading symbol BIM.

This press release contains certain information that may constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to management's future outlook and anticipated events or results, and may include statements or information regarding the future plans or prospects of the Company.

Forward-looking information is based on certain factors and assumptions regarding, among other things, expected mineral resources, iron ore prices, the timing and amount of future exploration expenditures, the estimation of additional capital requirements, the availability of necessary financing and materials, the receipt of necessary regulatory approvals, the feasibility of the road haulage option, factors impacting the feasibility of constructing and operating a direct-shipping iron ore mine at the Company's Mary River project and assumptions with respect to environmental risks, title disputes or claims, weather conditions and other similar matters. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward looking-information is subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what is currently expected. These factors include (i) risks inherent in the exploration for and development of mineral deposits; (ii) financing, capitalization and liquidity risks, including the risk that the financing alternatives necessary to fund the exploration and development activities at the Mary River Property may not be available on satisfactory terms, or at all; (iii) regulatory risks, including risks relating to the acquisition of the necessary licenses and permits; (iv) uncertainties inherent in the estimation of mineral reserves and resources; (v) risks that production estimates may be inaccurate; (vi) construction and operational risks inherent in the conduct of mining activities, including the risk of increases in capital and operating costs and the risk of delays or increased costs that might be encountered during the construction and development process; (vii) risks relating to changes in iron ore prices and the worldwide demand for and supply of iron ore; (viii) risks relating to the remoteness of the Mary River Property including access and supply risks and reliance on key personnel; (ix) environmental risks, including risks relating to climate impact on timelines and on construction and operating costs; (x) the risk of fluctuations in the Canadian/U.S. dollar exchange rate; and (xi) insurance risks.

You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While the Company may elect to, the Company is under no obligation and does not undertake to update this information at any particular time, except as required by law.

Contact Information

  • Baffinland Iron Mines Corporation
    Daniella Dimitrov
    Vice Chair
    416 814-3172
    Baffinland Iron Mines Corporation
    Michael T. Zurowski
    Executive Vice President