Black Iron drafting new feasibility study, EIA for investment agreement with Ukraine on Shimanovsky project

MOSCOW. Feb 20 (Interfax) - Black Iron Inc., a Canadian mining company that bought a license for the Shimanovsky iron ore deposit in 2010, said that it continues to promote the project, despite the difficulties with its implementation.

"The management of Black Iron Inc. wants to assure investors that it continues to develop its Shimanovsky iron ore project, located in Central Ukraine on the western bank of the Dnieper," Ukrainian media quoted a press release, posted on the company's website, as saying.

The main issue is obtaining the use of a land plot which is under the jurisdiction of the Ministry of Defense, which uses it for training military personnel.

"Progressive discussions on the transfer of state land have been held with the new Ukrainian Defense Minister and one of the deputy defense ministers, who both support this move in exchange for a compensation package," an investor said.

The company intends to provide an updated project feasibility study and sales plans for its products in the near future.

Ukraine is currently adopting legislation on the criteria required in order to qualify for investment support. The company plans to apply for an appropriate investment agreement, "which could eliminate the need for Black Iron to pay import duties and VAT on the equipment required for the project, and include support for the transfer of land by the state," the release said.

"This investment agreement may provide certain fiscal benefits and allow the company to apply for political risk insurance, which may be a condition required by banks and larger investors to finance the construction of the project," the press release said.

The fieldwork required to complete the environmental and social impact assessment is also ongoing.