Champion Iron Secures Quebec Government Financing for Bloom Lake Mine & Related Assets Acquisition
[Click image to enlarge]
Champion Iron Limited has entered into a letter of intent with Ressources Québec Inc., acting as mandatary of the Québec government, and that the company’s wholly-owned subsidiary, Québec Iron Ore Inc. (QIO), also entered into a letter of intent with Ressources Québec, acting as mandatary of the Québec government and acting on its own behalf, regarding partial funding of QIO’s acquisition of the Bloom Lake Mine and related rail assets and the Quinto Mining Corporation mineral claims in Québec from Cliffs Québec Iron Mining ULC, Bloom Lake Mine Iron Ore Limited Partnership, Bloom Lake Railway Company Limited and Quinto Mining Corporation (Bloom Lake CCAA vendors) and related costs.
Ressources Québec intends to invest, acting as a mandatary of the Government of Quebec, up to C$30M (increased from up to C$25M). The proceeds of this investment are to be contributed to QIO to finance the acquisition by QIO, and to secure up to 24 months of care and maintenance and the planned upgrade of the Bloom Lake assets.
Ressources Québec also intends to invest, acting as a mandatary of the Government of Quebec, C$14M in the form of shares and also intends to provide, on its own behalf, financing in the form of a term loan of a maximum amount of C$6M. The proceeds of this financing will also be used to finance the acquisition, and to secure up to 24 months of care and maintenance and the planned upgrade of the Bloom Lake assets.
The asset purchase agreement provides that the Bloom Lake assets and the Quinto Claims are being acquired for a cash consideration of C$10.5 million and the assumption of certain liabilities. Under the asset purchase agreement, QIO will become responsible for environmental obligations which include environmental reclamation liabilities presently assessed at approximately C$41.7 million by the Government of Québec, as well as the replacement of certain bonds securing certain obligations of Bloom Lake totaling approximately C$1.1 million.
About Champion
Champion has been working on the development of iron ore deposits in the Labrador Trough for more than 10 years through acquisition of tenements, geological evaluation, and development of a feasibility study (Fire Lake North deposit). The management team has a vast experience from geotechnical work to green field development, brown field management including logistics development and financing of all stages in the mining industry. The main focus of Champion’s activities, holding more than 3 billion tons of high quality iron ore resources, were concentrated on the effort to achieve an economical long term access from mine to ship. The Government of Québec has granted CAD$20 million for the feasibility study of a new rail linking Fire Lake / Bloom Lake area to the port of Sept-Îles. This study is being managed by Champion, and is expected to be finalized in 2016.
To stop by Champion’s website, CLICK HERE
Be in-the-know when you’re on-the-go!
FREE eNews delivery service to your email twice-weekly. With a focus on lead-driven news, our news service will help you develop new business contacts on an on-going basis.
CLICK HERE to register your email address.
Copyright © 2016 Mining Connection LLC. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
For licensing permission, .(JavaScript must be enabled to view this email address)
