Black Iron Inc.
The company was incorporated on June 29, 2010, under the Business Corporations Act (Ontario) for the purpose of acquiring, exploring and developing mineral properties. On Oct. 25, 2010, the company acquired all of the issued and outstanding shares of the Cyprus Subsidiary, which owns 100 percent of the registered capital of Shymanivske Steel LLC and Zelenivske Steel LLC.
Through Shymanivske Steel, the company’s activities are focused on the exploration and development of the Shymankviske iron ore project located in Kryviy Rih, Dnipropetrovsk Region. In addition, the company holds the exploration permit for the Zelenivske project in the close vicinity through Zelenivske Steel.
Shymanivske project
The ompany currently owns through its wholly-owned subsidiary Shymanivske Steel, a 100 percent interest in the mining permit that comprises the Shymanivske Project. The mining permit covers an area of 2.56 square kilometres located in the mining district of KrivBass. Extensive past exploration has been conducted on the Shymanivske Project, including approximately 37,000 meters of drilling and a Soviet engineering study. Black Iron retained Genivar, an independent engineering and consulting company, to complete a technical report for the Shymanivske Project in compliance with mining industry standards National Instrument 43-101. Pursuant to the report, the Shymanivske Project contains approximately 345 million tonnes of measured and indicated resources grading 31.83% iron and approximately 469 million tonnes of inferred resources grading 31.05% iron.
Black Iron has had quite an active 2011 with respect to the Shymanivske Project. In May, we released results of a ground gravity survey over the project, which showed the potential extension of iron ore mineralization at the north end of Shymanivske. This new area has not been included in our resource estimate and has the potential to push our total mineralization for the property above 1 billion tonnes. In October, we completed our confirmatory twin hole drilling program on the property. The program consisted of 6,042 meters of drilling, which was used to verify and validate the approximately 37,000 meters of historical drilling. We were quite pleased with the results of the program and received an independent report from the professionals at Watts, Griffis and McOuat Limited, Consulting Geologists and Engineers of Toronto, Canada concluding that the twin hole work agreed very well with the historical drilling work. Finally, on October 31, we issued the results of our Preliminary Economic Assessment for the Project, showing a pre-tax 42.1% internal rate of return, 2.2 year payback, and US$3.0 billion net present value. The Project has very robust economics, with projections of US$900 million or more to be directly invested into the project in Ukraine, which will also create thousands of local jobs. We believe this will represent the largest foreign direct investment into a Greenfield project in Ukraine.
Initial Public Offering – March 29, 2011
Black Iron debuted on the Toronto Stock Exchange on March 29 of this year. We raised approximately $38.5 million to fund the initial phases of our exploration and development plan. It is this money, in addition to the roughly US$30 million raised previously, that we are currently investing in Ukraine to complete drilling, geological and engineering work, which we ensure includes jobs for local Ukrainian firms.
As a result of our public listing, the Company has a broad shareholder base, which changes with each day of trading. Post IPO, our shareholder register looks as follows (all of which is publicly disclosed):
Shareholder Luxor Capital Partners – 23.5 percent.
Management, Board & Insiders — 20 percent.
RBC Global Resource Fund – 12 percent.
Groupo Salinas – 12 percent
Public Float — 32.5 percent.
We have undertaken a number of broad institutional and retail marketing campaigns across, North America, Europe, and Asia in an effort to communicate the Black Iron story and to potentially attract new investors. At this time, we are not aware of any of our current shareholders being based, or tied to, Ukraine or the CIS region. We believe the opportunity that exists with Black Iron is significant, and we hope to attract new investors across the globe, including Ukraine and the CIS region.
Special Advisor – Larry King
As part of our ongoing efforts to reach out to new investors and to explain the significance of the project we are building in Kryviy Rih, we have retained internationally recognized media host, Larry King. Mr. King will provide us with international advisory and awareness services based on his years of experience in international affairs and broadcasting, as well as his significant network of international contacts.
It is true that Mr. King’s visit to Ukraine helped provide awareness for Black Iron and our Shymanivske Project within Ukraine. But just as important, Mr. King’s visit has provided awareness for Ukraine and the investment opportunities that exist within the country, to many investor groups in North America and Europe. With few publicly-listed companies operating in Ukraine, and even fewer listed on exchanges outside the CIS or London, Black Iron represents an opportunity to showcase a great mining asset while at the same time highlighting a country that is rich in mineral and agricultural wealth.
Two-thirds of the publicly raised funds for the world’s mining sector are generated through the Toronto Stock Exchange each year. We are hopeful that we can build a successful project in Ukraine in combination with the capital available through the Toronto Stock Exchange, and that in the process we’ll help showcase Ukraine and pave the way for many other foreign direct investments into the country by other international groups.
Access To Information and Full Transparency
Black Iron is a publicly-listed company on the Toronto Stock Exchange main platform and as such is required to provide full and timely disclosure on the company and its developments. You can follow our progress and read all of our disclosure by visiting our website at www.blackiron.com, or by reviewing all of our publicly filed materials, including our IPO Prospectus, Technical Reports, Press Releases, Financials, etc. at www.sedar.com.
Alternatively, you can always reach us electronically at [email protected] or by telephone at +1 (416) 309-2950.
Thank you for providing us the opportunity to clarify who Black Iron Inc. is and what we are trying to achieve. We believe it is important that our efforts be portrayed accurately and hope that you’ll consider providing some additional background to your subscriber base.
Sincerely,
BLACK IRON INC.
Matt Simpson – President & CEO Nikolay Bairak – VP, Government & Community
George Mover – Chief Operating Officer Aaron Wolfe – VP, Corporate Development
Paul Bozoki – Chief Financial Officer Investor Cubed Inc. – Investor Relations
Christine Gallo – Corporate Secretary
