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Black Thor schedule uncertain: Cliffs

Keywords: Tags  Cliffs Natural Resources, Black Thor, ferrochrome, Joseph Carrabba, chromite, Michael Gravelle, Daniel Fitzgerald

NEW YORK — Cliffs Natural Resources Inc. is now declining to provide a schedule for its Black Thor chromite project due to a “stalled dialogue” with the provincial government of Ontario.

The Cleveland-based company expects to spend approximately $60 million in 2013 to complete the feasibility stage of the Black Thor development, but it cautioned that “resolution of certain critical elements of the project’s future are not solely within our control,” citing suspended discussions with the provincial government.

“In light of our stalled dialogue with the government, we are evaluating adjustments and our spending rate, which could impact the amount we invest in this project during 2013 and the project’s overall schedule. While we remain enthusiastic about this opportunity, we cannot predict how quickly the definitive agreements will be in place allowing the project to continue, and until the feasibility phase is complete, we will not speculate on the overall project schedule,” Cliffs chairman, chief executive and president Joseph Carrabba said in a Feb. 13 conference call.

“While negotiations and a binding agreement with the government have slowed and dialogue has been suspended during the provincial government transition, recent conversations with newly seated (Minister of Northern Development and Mines) Michael Gravelle indicate the province is committed to get a deal done,” he said. “It’s imperative, however, that the right deal is completed for both Cliffs and Ontario, even if it delays our previous project schedule.”

Last year, Cliffs revised the production start-up date for Black Thor twice from its initial forecast of 2015 to 2016 and later “beyond 2017” (, Oct. 26).

The mine is expected to produce about 100,000 tonnes of chrome ore and 560,000 tonnes of high-carbon ferrochrome annually.

Ferrochrome market sources told AMM Feb. 14 that they weren’t surprised by further delays in the project, particularly in light of the capital investment needed relative to the declining price of ferrochrome.

“I think the scope of what they’re trying to do up there—even if everything went according to plan—would take longer than what they’d estimated,” one trader said.

“When they started that project, high-carbon chrome was going for $1.40,” a second trader added.

AMM’s high-carbon ferrochrome price was at $1 to $1.04 per pound Feb. 13., up from lows of 94 to 99 cents in December.

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