Investor Presentation

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Iron Valley is an operating mine located in the Central Pilbara, which is being operated by Mineral Resources Limited (“MIN”) under royalty agreement. As at 30 June 2016, Iron Valley’s Mineral Resource was 238.7Mt at 58.4% Fe and its Ore Reserve was 123.2Mt at 58.8% Fe (refer here for more details).

Iron Valley is generating low risk royalty-like earnings for BC Iron. MIN operates the mine entirely at its cost and purchases Iron Valley product from BC Iron at a price linked to MIN’s realised sale price. BC Iron retains ownership of the tenements and certain statutory obligations, including payment of royalties.

Iron Valley is a relatively simple DSO operation which produces both lump and fines, which are hauled to Port Hedland utilising road trains and exported via Utah Point. MIN is assessing a range of improvement initiatives which have the potential to benefit both parties, including beneficiation and an innovative transport solution known as the “bulk ore transport system” or “BOTS”.

MIN shipped 4.2M wmt of Iron Valley product during the first half of FY17, which generated revenue for BC Iron of A$35.4M and EBITDA of A$12.8M. BC Iron’s FY17 EBITDA guidance for Iron Valley is A$18-25M based on a range of production rates and pricing-related assumptions set out in BC Iron’s ASX announcement released on 12 January 2017. Guidance remains under review, given current strong market conditions.