MONTREAL – CN has suspended work on the feasibility study for a proposed rail line to new iron ore producers in Quebec and Labrador. The company says that looming slowdowns in mine development timing and the lack of participation by all potential customers makes the project uneconomic.
In a release, CN noted: " A joint review of the project together with the mining companies indicates that mine construction schedules and diverging needs for each specific individual project will make it difficult to obtain the critical volumes of iron ore necessary to support the building of new rail and terminal infrastructure by CN. The decision by some miners in the region not to join the group of mining companies supporting the CN infrastructure project is also a factor in much lower than projected iron ore volumes that are now expected to be shipped in the foreseeable future."
New Millennium Iron Corp. of Calgary and Alderon Iron Ore Corp. of Vancouver have both stated publically that a CN rail line, or the lack thereof, will not affect their development plans. New Millennium said other modes of transport including a slurry pipeline for its LabMag and KeMag projects are being considered. Alderon noted that its Kami property is only 15 km from the Quebec North Shore and Labrador Railway.
The feasibility study was initiated in August 2012 with the agreement of CN to take the project through to the permitting stage with the backing of La Caisse de dépôt et placement du Québec. New Millennium, Alderon, Labrador Iron Mines Holdings, Cliffs Natural Resources, and Cap-Ex Ventures also participated in the study.