Black Iron's New Preliminary Economic Assessment Shows Highly Favourable Returns Including 36.1% IRR Post Tax

Black Iron (“Black Iron” or the “Company”) (TSX:BKI) (FRANKFURT:BIN) has received the results from BBA  (“BBA”) for a new Preliminary Economic Assessment (“PEA”) that incorporates, among other things, a two-phased build out of the mine and production plant along with updated iron ore selling prices and Ukraine’s favourable currency exchange rates for its Shymanivske iron ore project in Kryviy Rih, Ukraine (the “Project”).
The updated PEA outlines a first phase operation producing 4Mtpa of ultra high-grade, low impurity, 68% Fe concentrate expanding to 8Mtpa starting in the fifth year of production. Using this phased build strategy coupled with Ukraine’s highly favourable exchange rate of 28 Hryvnia to US$1, results in a projected pre-tax, post royalty, internal rate of return (“IRR”) of 42.6%, a payback period of 2.6 years and a US$2.12 billion net present value (“NPV”) at a 10% discount rate. The post tax unlevered economics show a compelling 36.1% IRR, 2.9 year payback period and US$1.66 billion NPV at a 10% discount rate.
Matt Simpson, Black Iron’s CEO, commented:

“The operation outlined in the re-scoped PEA for the Shymanivske Project continues to clearly demonstrate the potential for a high-value, low net cost iron ore development project.
Use of ultra high-grade 68% iron content product in the production of steel is a value-added product to customers as it increases blast furnace productivity and reduces specific greenhouse gas emissions.”

Click here to read the full text release.