Largest iron ore deposit in Canada gets a nod

Lac Otelnuk, located between Kuujjuaq and Shefferville, is said to be one of the 15 top iron deposits in the world. (FILE IMAGE)

A giant-sized iron mine in Nunavik — which will produce two times more iron over its lifetime than Nunavut’s Mary River mine — announced today that its economic assessment looks good.

Adriana Resources Inc. said it had received positive results from a Preliminary Economic Assessment for a 50-million tonne per year operation on the Lac Otelnuk iron ore project.

Adriana’s $8.5 billion joint venture project with China’s Wuhan Iron and Steel Co. Ltd. to develop the mine may produce 50 million tonnes of iron a year for up to 100 years.

“We are encouraged by the robust economics demonstrated by the Preliminary Economic Assessment for the Lac Otelnuk Project. The possible combination of a strong strategic partner and robust economics provides the ability to realize upon the value represented by the largest iron ore deposit in Canada. Lac Otelnuk has the potential of being the largest mining project in Canadian history and the largest private investment in the history of Quebec. We are excited about the future and look forward to advancing the project,” said Allen J. Palmiere, the CEO of Adriana.

Basing its forecasts on an iron price of study US$100 per tonne of pellets from Sept-Îles, the study confirms that the mine’s production is worth $15.2 billion.

The Lac Otelnuk mine will:

• mine and concentrate an average of 175 million tonnes of iron ore per year;

• pelletize 50 million tonnes of concentrate;

• construct an 815 kilometre railway; and,

• build the necessary port capacity to accommodate Chinamax ore carriers.

A definitive feasibility study is planned for 2011, an April 13 news release from Adriana said.