Tata Steel Minerals Canada (TSMC), 80 per cent owned by Tata Steel, is likely to take a major investment decision shortly for the low-grade iron ore (taconite) mining project in the semi-Arctic region of North America.

New Millennium Iron Corp (NML), Tata Steel’s junior strategic partner in TSMC, said TSMC was expected to review soon the feasibility study on the two deposits and the project’s financial model to determine the future of the ambitious project.

The deposits -- LabMag and KeMag -- having around 30 per cent iron content are part of the 150-km long Millennium Iron Range in northern Canada. An initial estimate suggested investments worth $4.4 billion and $5 billion each were required for development.

Cost of other project infrastructure – a 600-km long ferroduct to carry ore slurry and deep port terminal handling facilities – is additional to mine development costs. Dean Journeaux, CEO of Torornto-listed NML, said: “We believe that the results (of the study) are positive”.

He also said in a recent statement to the Toronto Stock Exchange that the infrastructure portion of the project could be funded by “specialised long-term financing at competitive interest rates”. The final report would also include such options. NML has also prepared the financial models for the project, based on the study manager results, including after-tax projection. NML, after consultation with Tata Steel, engaged an internationally recognised firm to review the financial models and assumptions “to give more assurance” on the outcome. According to the proposed timeline, this exercise was to be complete this month.

Meanwhile, TSMC’s direct shipping ore project for magnetite ore in the nearby area within the Millennium Range has made second shipment in November before closing for winter, NML said.