The company said in a statement that it is encouraged by the results of the initial three infill drill holes, with each intersecting significant iron bands grading 30% iron ore or more.
Highlights include hole BISH-63, which returned 150 metres grading 33.2% total iron, including 74 metres grading 35.0% total iron.
"As anticipated, the assay results from the first three definition and exploration holes line up well with the previously completed drill work on the property, both the historical drilling logs and the confirmation drilling we completed last year," said COO George Mover.
"The first phase of our current drilling program is focused on infill drilling to update the classification of mineral resources, which is required for the ongoing Feasibility Study.
"Upon completion of the first phase, which is expected to convert a large portion of the current inferred resources to measured and indicated resources, we will turn our attention to the northern part of Shymanivske, which has not yet been included in any mineral resource estimates.
The three holes reported Tuesday are part of a 20,000 metre definition and exploration drill program started by the company last October, which is designed to upgrade resources to allow for a larger mineral resource to be considered in the ongoing feasibility study.
The campaign is also focused on exploration holes in the northern end of the asset, where the company believes additional resources may exist, but have not yet been explored.
The company noted that no drilling is currently underway at the project as Black Iron obtains additional permissions required to drill. On Friday, Black Iron said it believes the timing for the re-start of the drill program should not affect the project's current development path.
In December, the mineral explorer hired WorleyParsons to finish a feasibility study for its Shymanivske iron ore project, which is slated to be released in fourth quarter 2012.
The company said WorleyParsons has found a number of ways to improve the project economics with the view to simplify the process flow sheet to allow for higher annual tonnage and minimize capital and operating costs.
The feasibility study will build on the preliminary economic assessment of the project, which showed a low cost pellet plant feed operation with a projected high value and net cash flows.
The preliminary report, completed by BBA of Montreal, considered two production scenarios over a 28 year mine life. The first scenario is a 7.3 million tonne per year iron ore pellet plant feed, while the second scenario is a production alternative for producing 7.6 million tonnes per year of iron ore pellets.
The first option projected 42.1 percent internal rate of return, with a whopping US$3 billion net present value, at an eight percent discount rate.
Total capital costs came in just shy of $900 million, with a payback period of 2.2 years, and an estimated operating cost for an initial 20 years of $52.40 per tonne.
The second scenario for Shymanivske outlined the option to produce a higher margin pellet product of 65 percent iron grade, for a higher net present value of US$4.1 billion at the same discounted rate, but with a reduced 35.2 percent internal rate of return, due to raised construction costs.
Shymanivske contains a NI 43-101 compliant resource of 373 million tonnes in the measured and indicated category grading 31.3% iron and 480 million tonnes of inferred resources grading 30.2% iron.
The project is surrounded by five other operating mines, including ArcelorMittal's iron ore complex. The company said it believes that the existing infrastructure, including access to power, rail and port facilities, will allow for a quick development timeline to production.
Black Iron also holds an exploration permit for the adjacent Zelenivske project that it plans to further explore to determine its potential.