Labrador Iron Ore Royalty Corp.2022 Earnings, 2023 Forecast

This is only a sample of the article, please login to view the entire article

Labrador Iron Ore Royalty Corp. (LIF) earns income from royalty and ownership interests in the Iron Ore Company of Canada. The royalty interest consists of a 7% royalty plus 10 cents per ton on all sales of iron ore products plus dividends on their 15.1% ownership interest in the IOC. IOC operates an open pit mine, concentrator, and iron ore pellet-making plant at Labrador City, Nfld., as well as a 420km railway and port facilities at Sept-Iles on the Gulf of St. Lawrence. After processing at the Labrador City facilities, the pellets and concentrate are transported 418 km south via the Quebec North Shore and Labrador (QNS&L) railway to the company's shipping terminal and deep water port in Sept-Îles, Quebec. The Iron Ore Company of Canada has been Canada's main supplier of iron ore for five decades.

Iron ore is an essential component of the global iron and steel industries. Almost 98% of mined iron ore is used in steel making. About 50 countries mine iron ore, with Australia and Brazil dominating the export market. Mines in Michigan and Minnesota account for the bulk of iron ore production in the United States. Worldwide production of iron ore (all grades) totals an estimated 2.4B tons. China accounts for over 50% of iron ore demand. IOC's concentrating plant can produce 23.3M tons of iron ore concentrate per year. In 2022 was 19M tons(2021-17.9M tons).

Labrador Iron Ore Royalty Corporation (LIF) has been involved in Labrador West for 80 years. Under a Statutory Agreement with Newfoundland made in 1938, a predecessor company, Labrador Mining and Exploration Limited, was granted extensive exploration and mining rights in Labrador West. LM&E found the iron ore bodies that now constitute the mine operated by the Iron Ore Company of Canada. LM&E received grants of leases and licenses under the Statutory Agreement. It also received a grant of surface rights to establish the town site that became Labrador City. LM&E sublet the leases to IOC and IOC, with major steel companies as original shareholders, built the infrastructure, mine, railway, and port. Under the sublease, LIORC receives a 7% gross overriding royalty on iron ore products produced and sold by IOC.

You must be a member to view the entire article, please subscribe or login