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Baffinland launches iron ore shipments to Europe


MONTREAL, Que.–On the heels of the recent kick-off of the annual Arctic open water season, Baffinland Iron Mines has launched the first regular commercial shipments of iron ore to Europe from Milne Inlet on the north coast of Baffin Island. Steel giant ArcelorMittal has a 50% stake in Baffinland, and European steel mills are the primary destination for the high-grade iron ore from the large Mary River mine.

The iron ore is being transported by a pool of dry bulk vessel operators, including Montreal-based Fednav Ltd. and Scandinavian carriers Nordic Bulk Carriers and Golden Ocean.

Total volume shipped to the end of August has been an estimated 275,000 tons. For the whole start-up season, an industry source suggested that total volume could run to one million tons as a result of about 20 voyages.

Observers consider that a previous goal of 3.5 million tons has been adjusted downwards due to the global plunge in iron ore and steel prices.

“During August, five ships sailed from Milne Inlet for Europe – four Panamaxes and one Supramax,” said a spokesperson for Baffinland’s headquarters in Oakville, Ontario.

“As soon as one vessel departs, another is ready to take her place,” indicated Michael Cooper, Fednav’s Manager of Capital Projects, Ship Owning, Arctic and Projects.

“It is anticipated that shipping will continue until early to mid October, when freeze-up prevents anymore of these vessels entering the area,” Cooper said.

Fednav’s ice-class Federal Tiber was the initial vessel to be loaded with some 54,000 tons of iron ore. It departed with its cargo destined for Nordenham, Germany, on August 8.

Commenting on the occasion of the first commercial shipment, Tom Paddon, President and CEO of Baffinland, declared: “This is a great moment for Baffinland, its investors and its employees, who have worked hard to reach this goal.”

He called the event “a significant moment for Nunavut with the world’s most northerly open pit mine now fully functional on Baffin Island.”

Paddon further noted: “In just two years, the men and women who work at the site, both Inuit or southern, have collaborated to build the mine and its infrastructure and have now moved the new port in full operation.”

The iron ore is trucked some 100 km to Milne Inlet, where a stockpile infrastructure and docking facility have been erected. A two-tower ship loader and reclaim conveyor system loads the iron ore onto the awaiting vessels.

In the wake of the sharp decline in world commodity prices, Baffinland Iron Ore Mines had previously scaled down indefinitely an original Phase Two $4 billion project involving the construction of a railway to Steensby Inlet on the south coast to ship 18 million tons annually.

A proposal to ship up to 12 million tons a year from Milne Inlet 10 months of the year was turned down last April by the Nunavut Planning Commission on the grounds that it failed to confirm to the territory’s land use plans. In particular, ice-breaking activity would be taking place in essential harvesting areas and aboriginal transportation routes. Baffinland Iron Ore Mines is reviewing its options for future developments on the basis of what it qualifies as “responsible stewardship.”


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