“Champion now controls reserves and resources being the equivalent in scale to nearly ten Bloom Lakes.”

What led to record production at Bloom Lake?

Further to nearly US$4 billion invested at Bloom Lake by Champion’s predecessors, our company recommissioned the mine in 2018. The recommissioning included structural investments required to reduce operating costs by nearly half compared to our predecessors. Since then, Bloom Lake has proved its ability to produce at or above the nameplate capacity of 7.4 million t/y of high-grade 66.2% Fe iron ore concentrate, and reduced emissions in the steel-making process due to its high-purity. Champion recently completed the Phase II expansion project, which aims to double Bloom Lake’s nameplate capacity to 15 million t/y. The company completed this project ahead of schedule and within the range of the 2019 Feasibility study anticipated expenditures. Champion announced the first rail shipment from the Phase II expansion in May 2022, which contributed to a record production quarter in our first quarter of the fiscal year.

The Phase II project which began nearly a decade ago by Champion’s predecessor, received nearly US$2 billion in cumulative investment and is one of the largest mining projects to come into production across North America over the last decade.

Can you provide updates on progress at the Kami project since its acquisition in April 2021?

In line with our vision to reduce emissions in the steel industry with our high-purity products, we acquired the Kami project in April 2021. The Kami project, which sits directly East of Bloom Lake and near infrastructure, has often been discussed as one of the next projects in the Labrador Trough. With its high-quality geology and large resources, the team is updating a feasibility on the project, which is expected to be completed in the first half of 2023. Further to the acquisition of the Kami project, Champion now controls reserves and resources being the equivalent in scale to nearly ten Bloom Lakes. Such a large portfolio, in addition to opportunities to upgrade our already market leading high-purity iron ore, provides several growth opportunities for Champion.

How does Champion Iron’s MOU with an international steelmaker on the acquisition of the Pointe Noire pellet plant fit within the company’s broader vision to contribute to the green steelmaking supply chain?

The steel industry is one of the largest CO2 emitters globally, representing nearly 8% of global emissions. A leading method to reduce emissions in blast furnaces (BF) and basic oxygen furnaces (BOF) is to consume higher quality iron ore. Champion’s high-purity 66.2% iron ore concentrate already serves to reduce emissions by nearly 10% in the BF/BOF steel-making process compared to traditional lower-grade iron ore products. While BF/BOF are the prevailing steel-making methods globally, particularly in Asia, an alternative to significantly reducing emissions in steelmaking is to transition to Electric Arcs Furnaces (EAFs), which primarily consume scrap steel. EAFs can produce steel at 25-50% of the emissions of BF/BOF steelmaking, but require high-purity raw materials to produce flat steels. As many countries aim to reduce emissions, there is an accelerating trend for steel makers to transition from BF/BOF to EAFs, which is set to increase demand for raw materials required by EAFs including scrap steel. As scrap steel has finite availability, the growth in EAF capacity will require alternate sources of high-purity raw materials including Direct Reduced Iron (DRI). DRI requires high-purity iron ore feed, which has proven to be produced in a few hubs globally, including the Labrador Trough, Brazil and Ukraine/Russia.

The acquisition of the pellet plant in Pointe Noire and the MOU with a global leader in steelmaking was completed in line with Champion’s strategy to participate in emission reductions across the steel-making supply chain. Champion aspires to complete a feasibility in 2023 to produce Direct Reduction pellets in Pointe Noire in tandem with the international steelmaker. In addition to its potential to contribute substantially in the green steel supply chain, DR pellets also attract a substantial premium to our current 66.2% Fe iron ore concentrate, which could further position Champion as a cost leader in the industry.