TORONTO, ONTARIO -- (Marketwire) -- 02/07/13 -- Champion Iron Mines Limited (TSX: CHM)(OTCQX: CPMNF)(FRANKFURT: P02) ("Champion", or the "Company") is pleased to announce the results from its Preliminary Feasibility Study ("PFS") for the West and East deposits of the Consolidated Fire Lake North ("CFLN") Project that was performed by BBA Inc. ("BBA") of Montreal, Quebec. The study is based on an initial 20 year mine life and produced a Net Present Value ("NPV") of $3.295 billion using an 8% discount rate. The financial model shows an Internal Rate of Return ("IRR") of 30.9% and a capital payback period of 3.4 years. The financial results included in this press release are expressed in Canadian dollars and pre-tax (unless otherwise noted).
Summary of Preliminary Feasibility Study Results
----------------------------------------------------------------------------NPV at 8% discount rate (Pre-tax) $ 3,295 million----------------------------------------------------------------------------IRR (Pre-tax) 30.9%----------------------------------------------------------------------------Payback Period at 8% discount rate 3.4 years----------------------------------------------------------------------------Pre-production Capital Cost (excluding rail cost) $ 1,394 million---------------------------------------------------------------------------- - Rail capital contribution $ 213 million----------------------------------------------------------------------------Average Operating Cost (loaded at Port of Sept-Iles 44.05 per tonne including rail capital and debt service costs) $ of concentrate----------------------------------------------------------------------------FOB Concentrate Selling Price based on CFR China benchmark price at 62 % FeT adjusted for higher CFLN Fe grade @ $5.00 per percent and $20.00/t freight cost Year 1-5 $ 115.00 per tonne Year 6-20 $ 110.00 per tonne----------------------------------------------------------------------------Mine Life 19.6 years----------------------------------------------------------------------------Concentrate Grade (percent contained Fe) 66%----------------------------------------------------------------------------Process Recovery (Iron) 82%----------------------------------------------------------------------------Weight Recovery 39.9%----------------------------------------------------------------------------Average Annual Concentrate Production 9.3 M Tonnes----------------------------------------------------------------------------In-pit Optimized Measured and Indicated ResourcesWest and East Deposits, CFLN Project(COG of 15 %, 31.5% Total Iron) 691.3 M Tonnes----------------------------------------------------------------------------Engineered Optimized In-Pit Mineable ReservesWest and East Deposits, CFLN Project(COG of 15 %, 32.4% Total Iron) 464.6 M Tonnes----------------------------------------------------------------------------Projected Concentrator Plant Start-up and Commissioning Q1 2016----------------------------------------------------------------------------Projected Start of Nominal Production Q2 2016----------------------------------------------------------------------------
