Alderon’s Kami Receives Federal Environmental Approval

Putting out good news this morning was development company Alderon Iron Ore (TSX:ADV,NYSEMKT:AXX), which said that yesterday, Canada’s federal minister of environment concluded that the company’s 75-percent-owned Kami project, located in Western Labrador, is “not likely to cause significant adverse environmental effects.”

The minister’s blessing is “another enormous milestone” for Alderon, according to Tayfun Eldem, the company’s president and CEO, as it allows Alderon to move forward with the project “subject to the terms and conditions included in any federal permits or authorizations.”

The company has not been short on milestones lately. On January 10, the government of Newfoundland and Labrador determined that Kami meets the requirements of the province’s environmental assessment process, while more recently the government said it will go forward with building a third transmission line between Churchill Falls and Labrador West. The line is important to Alderon because it will “ensure there is enough transmission capacity to deliver power to the Kami Project.”

Also in January, Alderon signed agreements with the Town of Labrador City and the Innu Nation of Labrador. The former will see Labrador City receive “additional revenue which will help deal with the demands of anticipated growth in the region and strain on aging infrastructure,” while the latter is aimed at establishing benefit sharing between the two groups.

Moving forward, expect to see Alderon beginning construction at Kami — Global BC notes that Eldem has said it could start as early as this spring or summer, “creating about 800 jobs with hundreds more spin-offs, along with 500 full-time production jobs.” That’s likely to bring some cheer to the region, which last week was hit with the news that Cliffs Natural Resources (NYSE:CLF) will be idling its Wabush mine by the end of Q1 2014.

Shares of Alderon are currently selling for $1.92 each, up 0.52 percent.

Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article. 

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