Century Iron Mines Corp. (TSE:FER) late Tuesday released the initial mineral resource statement for its Hayot Lake iron deposit located in Quebec on the Attikamagan iron project, calling it a "defining milestone".
The company said that the Hayot Lake iron deposit is estimated to contain an inferred mineral resource of 1.723 billion tonnes grading an average of 31.25 per cent total iron, at a cut-off grade of 20 per cent total iron.
Century Iron said that the mineral resource model was constructed using drilling data acquired in 2011 and 2012.
"Only 18.5 kilometres from Schefferville; the Hayot Lake iron deposit is well located in the Labrador Trough iron ore mining camp," said president and Century's CEO Sandy Chim.
"Schefferville is where the existing operating rail infrastructure begins connecting to the Port of Sept Iles, where the Port Authority and a number of miners are expanding the capacity of the port by 50 million tonnes per annum.
"Having close to 2 billion tonnes of iron ore in resources at Hayot Lake is a defining milestone laying the solid foundation to expand from our initial Joyce Lake mining plan targeting production in 2015."
The Attikamagen iron project includes one group of claims straddling the boundary between the provinces of Quebec, Newfoundland and Labrador.
The property includes 405 designated cells located in Québec - Hayot Lake, and 617 claims located in Labrador and Newfoundland (Joyce Lake), covering an aggregated area of approximately 34,348 hectares.
Chim said that the development of these projects will increase the value of the near term cash flow potential to achieve and enhance the company's longer term high volume and high cash flow value proposition.
"Taconite mining is the backbone of the American iron ore industry for the last half a century presenting a development model of high volume consistent iron ore concentrate and pellet for the Trough in the face of a growing seaborne market."
The Hayot Lake iron deposit is a large taconite iron deposit hosted in folded banded iron formations of the Proterozoic Sokoman Formation, the company said.
It added that the iron mineralization is stratabound and sedimentary in origin and occurs within a synclinal structure plunging shallowly to the southeast.
Century Iron Mines is Canada's largest holder of iron ore land claims and it is backed by two Chinese strategic partners through financing and off-take agreements: MinMetals and WISCO International Resources, a unit of Wuhan Iron & Steel, also known as China's third-largest steel producer.
The two massive Chinese conglomerates are ranked among the Forbes Global 500 and are two of China's largest mining companies. In 2010, the WISCO group produced 36 million tonnes of crude steel, ranking as the fourth-largest steel mill in China and the fifth-largest in the world.
Earlier this week, Century Iron unveiled recent drilling results from its Joyce Lake direct shipping ore (DSO) prospect at the Attikamagan project.
The iron ore miner said the first batch of assay results confirmed a zone of high grade iron mineralization at Joyce Lake, with intercepts up to 54 metres over 60 per cent total iron and with an average of 6.09 per cent silica.
Assays are pending for a remaining 45 holes, the company said, adding that following the receipt of all the results, an NI 43-101 compliant resource estimate will be initiated - with a completion target set for year-end.