Interim Report January – June 2021
Significant events during the second quarter 2021
- Veidekke is hired to design the main decline between the mine and the industrial area
- Paterson & Cooke hired for the study of the management of tailings
- Cooperation agreement signed with Epiroc
Second quarter, 1 April – 30 June 2021
- Income amounted to SEK 0 million (0)
- Earnings after tax amounted to SEK –2.2 million (–2.0)
- Investments in the period April–June totalled SEK 0.6 million (0.4)
- Basic earnings per share were SEK –0.07 (–0.07)
Interim period, 1 January – 30 June 2021
- Income amounted to SEK 0 million (0)
- Earnings after tax amounted to SEK –4.9 million (–4.6)
- Investments in the period January–June totalled SEK 2.6 million (0.8)
- Basic earnings per share were SEK -0.15 (–0.15)
- Cash and cash equivalents on 30 June 2021 amounted to SEK 5.4 million (5.8)
Significant events after the end of the period
- The short-term loan facility of SEK 10.5 million was extended until the end of the year
Preparations for the construction work and continued favourable market developments
There is absolutely no doubt that the world needs to reduce its carbon emissions, a fact that the UN’s climate panel, IPCC, once again concluded in its most recent report. The steel industry represents a large share of emissions, and an increasing number of steel manufacturers, both in Sweden and globally, are working to reduce their footprint through sharply reduced emissions.
In order to achieve the desired reduction in emissions from steel manufacturing – at the same time as demand for steel is expected to rise – manufacturers will be forced to use production methods that require high quality iron ore feedstock. This increases the interest in the very type of products that Nordic Iron Ore will produce, and is confirmed by the companies that are contacting us to discuss various partnerships.
Our goal is to build an ultra-modern mine with as low of an impact on the environment as possible. To do this, we are pursuing several paths simultaneously. During the second quarter of the year, we engaged the consultancy firm Paterson & Cooke to analyse different alternatives for improved handling of tailings. Our goal is for as large a share as possible to be deposited below ground, which decreases the impact above ground.
We also engaged Veidekke Sverige to plan the ramp that will connect the industrial area in Skeppmora, where the processing plant will be located, with the Blötberget mine. The work on this connection will be time intensive and costly. It is therefore important to carefully evaluate different alternatives. Together with the Swedish Transport Administration, we have started a working group to update the existing planning for the rail terminal.
VB Energi has experienced a delay in its work to move the power line. The delay is due to problems with material deliveries, but the work is expected to be completed during the current quarter. The collaboration to plan the coming switchboard plant that will link the industrial area to the relocated power line is now continuing.
Market developments
The second quarter of the year was influenced by rising volatility in iron ore prices. Prices are still high, and, in particular, the premium prices for higher qualities continued to be strong. Some of the upswing in the prices can be explained by the sharp increase in transport costs. The entire logistics chain is under pressure and is sensitive to disruptions from bad weather, which, together with the difficulties larger suppliers are having to increase their deliveries, is resulting in greater uncertainty and, in turn, price increases. The strong price trend and the increase in the price gap between the quality indices are clearly demonstrated in the following graph:
The diagram clearly illustrates how the price gap between various ore qualities increased during the current year, primarily due to the lower price raises for lower-quality ore.
The strong development on the iron ore market and the interest in greener steel manufacturing creates an excellent background for now finally financing the project and starting the practical construction work. We have a very exciting period ahead of us, and one important task we are working on now is to secure the personnel that will be required when the work intensifies during the autumn.
For further information please contact:
Lennart Eliasson Managing Director
phone: +46 70 640 5177
lennart.eliasson@nordicironore.se
Nordic Iron Ore Group is a mining company with the ambition to revive and develop the iron ore production of Ludvika Mines in Blötberget and Håksberg. The company also intends to expand its mineral resources, and upgrade them to ore reserves, primarily through exploration and other studies of the connecting Väsman field. The Company has all the necessary permits in place for the mine in Blötberget and will be able to produce iron ore of extremely high quality.
For more information, see www.nordicironore.se.
Nordic Iron Ore’s shares and warrants are listed at Nasdaq First North Growth Market. Wildeco is the company’s Certified Adviser (info@wildeco.se tel +46-8-545 271 00).
This information is required and provided by Nordic Iron Ore AB (publ) under the EU Market Abuse Regulation. The information was provided through the agency of the contact person set out above for publication at the date and time set above.
