Project Development

[Last update May 7, 2012]

Construction Update

On May 7, 2012, New Millennium Iron announced the results of the ground gravity survey conducted near the vicinity of the Timmins DSO concentrator plant area by Tata Steel Minerals Canada (“TSMC”). These anomalies are part of 50 strong gravity anomalies with coinciding weak magnetic anomalies outlined by the 2010 Airborne Magnetometer and Gravity survey (Refer to NR 11-03). The ground gravity survey carried out in the fall of 2011, by Géosig Ltée of Québec, was done to validate the locations of the airborne gravity anomalies on the ground and select targets for further exploration.

Results of 2011 Program: (NR1212)

The 2010 Airborne Magnetometer and Gravity survey outlined 13 strong gravity anomalies with coinciding weak magnetic anomalies in a radius of 5 km around the plant site in the provinces of Quebec and of Newfoundland and Labrador (Refer to NR 11-03). These surveys are conducted to indicate the presence and location of potential DSO type deposits. The ground gravity survey carried out in the fall of 2011, by Géosig Ltée of Québec, was to validate the locations of the airborne gravity anomalies on the ground. Eleven (11) of the 13 airborne gravity anomaly areas were checked with ground gravity survey (Figure 2) and were found to coincide with the airborne gravity targets. The survey covered 39 lines over a length of 35.4 line kilometers. The following Table 1 shows the survey details.

                                             Table 1

The ground survey results were interpreted by Jean M. Hubert, P.Eng, consulting geophysicist for TSMC. Some of the anomaly areas surveyed cover the known DSO deposits and serve to validate the selection of targets for further investigation. The intensity of the gravity anomaly (mgals values) over the deposits varies between 1.0 and 2.68. Comparable gravity values (mgals) seem to occur in many of the surveyed areas indicating the potential for discovering additional DSO deposits closer to the Timmins processing plant. The ground gravity values are higher because of the proximity of the Gravity Meter to the surface compared to the airborne instrumentation. J. M. Hubert interpreted and evaluated all the survey data and recommended follow up surface exploration work with test pitting, trenching and test drilling of 10 anomalies. Selected priority targets and comparison with known DSO deposits are shown in Table 2 below. All areas except the known deposit areas will be field checked. For further details regarding the survey results, please refer to the Table in Appendix 1 attached.  

Table 2

The installation of the equipment is expected to be completed in Q4, 2012 followed by operation start up and ore production by year end. (Refer to NR1206)

DSO Project Progress:

Procurement of Major Equipment:

Orders for the following major process equipment and long lead items have been placed:

• Mineral sizing station
• Jigs and Wet High Intensity Magnetic Separators (WHIMS)
• Spiral Classifiers and Hydrosizers
• Dewatering and Drying
• Diesel Generators
• Rail Cars

Construction and Production Start-up:

A rigid frame structural dome (Refer to NR 11-34, November 22, 2011) is being fabricated at the manufacturer’s plant. Pre-cast concrete foundations have been cast and are being delivered to the site. The dome erection is expected to be completed in Q2, 2012. Referring to Figure 1, the installation of mechanical and electrical equipment is expected to start in Q3, 2012. The equipment will be progressively commissioned to enable starting of production before year end. Mine preparation work is expected to begin in Q3, 2012.

Rail Transportation & Port Logistics:

 The following progress has been achieved: (Figure 2 of NR1206)

• KéRail: 18 km long spanning from the Timmins Yard to Tshiuetin Railway (TSH) will be built by and operated by an Independent Rail operating company. An MOU has been signed with an Operator and final agreement is being negotiated. The construction is expected to start in Q2.
• TSMC has signed an MOU to haul of its ore from Schefferville to Emeril Junction by TSH. Final agreement will involve financing of TSH’s track rehabilitation program.
• QNS&L: A life of mine tariff agreement has been signed with QNS&L to haul ore train from Emeril to Arnaud Junction (Refer to NR 12-05, January 30, 2012).
• Rail cars are under fabrication and will be delivered progressively in Q3.
• TSMC is negotiating with operators to handle its ore dumping, stockpiling and shiploading at Sept-Iles.
• TSMC has an agreement with the Sept-Iles Port Authority (SIPA) for handling its ships over SIPA’s docks. (Refer to NR 10-01, February 16, 2010).

The permit application for site excavation, the construction of the processing plant and related infrastructure has been approved by the Government of Newfoundland and Labrador (“GNL”), subject to customary conditions. TSMC is proceeding to satisfy these conditions. The order for the supply of the building structure has been placed with Big Span Structures based in Hernando, Florida, USA. The space frame system will cover under one roof the entire processing complex as well as other installations such as offices, warehouse, laboratory, repair and maintenance shops. A year round climate controlled environment during operations will facilitate achieving a high plant operating efficiency and enhance productivity.