Oceanic Iron Ore has announced that the pre feasibility study prepared by Micon International on the Hopes Advance iron ore project belonging to Oceanic Iron Ore Corporation of Vancouver is positive.

The projected net present value of the project is USD 5.6 billion and a pre tax levered internal rate of return of 23.2% using an iron ore price of USD 100 per tonne.

Production is expected to begin in 2017 at an annual rate of 10 million tonnes of concentrate. Operating cost will be only USD 30 per tonne. The life of the project is 31 years, with the production to be doubled after the first decade.

The initial capital cost, including indirect costs and contingency, will be USD 2.85 billion, and the cost of the eventual expansion will be USD 1.61 billion. The Hopes Advance project is located in Nunavik, and the concentrate could be transported by ship.

Oceanic says its next steps will conclude palletizing tests by the end of 2012, finding a partner and project financing next year, producing a feasibility study in 2013, concluding the environmental impact assessment and permitting in 2014 and negotiating an impact and benefits agreement. Construction could start in 2014.

Source - Oceanic Iron Ore

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