The company said it continues to be encouraged by the results of infill drilling, with the intersection of thick iron bands in each hole at grades of over 30% iron.
Of note from the three infill holes announced today, hole BISH-67 returned 103.5 metres grading 30.7% iron, including 27.0 metres at 34.4% iron, and 73.0 metres at 32% iron, including 45.0 metres of 34% iron.
"Results from the infill drilling work continue to validate our understanding of the Shymanivske deposit and our belief that the majority of the inferred historical mineral resource will be successfully upgraded to measured and indicated mineral resource categories in our new mineral resource estimate, which is anticipated in the summer of 2012," said COO George Mover.
The three drill holes are part of a 20,000 metre definition and exploration drill program initiated by the company last October. The campaign is designed to upgrade mineral resources to higher categories to allow a larger mineral resource estimate to be considered in the ongoing feasibility study.
The program is also designed to focus on exploration holes in the northern end of the property, an area that has not yet been explored but where the company said additional resources could exist.
Ukraine-based Mekhanobrchermet (Research Institute of Mineral Processing in Ferrous Metals) has been hired to complete independent metallurgical test work on the recovered drill core, the company said.
As previously announced in March, there is now no drilling underway at Shymanivske as the company waits for additional permissions required to drill. Black Iron has 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 project, which is slated to be released in the fourth quarter 2012.
The 100 percent-owned Shymanivske project in Kryviy Rih, Ukraine has NI 43-101 compliant 373 million measured and indicated resources grading 31.3% iron and 480 million tonnes of inferred resources grading 30.2% iron.
The property is surrounded by five other operating mines including ArcelorMittal's iron ore complex. The company has said that existing infrastructure, including access to power, rail and port facilities, will allow for a quick development timeline to production.
A preliminary economic assessment of the project 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.
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.
Earlier this month, the company announced the results of the initial three infill drill holes at Shymanivske, with each intersecting significant iron bands grading 30% iron ore or more.
Highlights included hole BISH-63, which returned 150 metres grading 33.2% total iron, including 74 metres grading 35.0% total iron.
The company also holds an exploration permit for the adjacent Zelenivske project, which it intends to explore further to determine the potential.