Access to cheap hydropower is the biggest single cost driver for the production of magnetite concentrate and is critical for the success of Project Iron Bear. The CLE team has completed a detailed study to evaluate the opportunity to leverage the Menihek hydro-plant which is located approximately 130 km away from the Iron Bear mineral resource.

Location of key infrastructure facilities

Whilst the Menihek hydro-plant currently only provides ~20MW to Schefferville via two 69kV powerlines, we estimate that unutilised capacity at the hydro-plant should be able to produce up to 200MW for a total CAPEX which is estimated not exceed USD 145m. This would most likely be reflected in an increase in electricity price of ~ USD 1ct/kWh assuming a take or pay agreement. For reference, the power requirements of Project Iron Bear are estimated to be roughly ~150MW at full production