Understand the impact of the Ukraine conflict from a cross-sector perspective with the Global Data Executive Briefing: Ukraine Conflict
The Shymanivske iron ore deposit in the KrivBass iron ore basin in the Dnepropetrovsk region of Ukraine is being developed by Black Iron, through its subsidiary Shymanivske Steel.
Ukraine is one of the world’s biggest iron ore producers and the second biggest iron ore producer in the Commonwealth of Independent States (CIS).
The Central Government of Ukraine granted the Mining Allotment Certificate for the project in August 2014. A feasibility study (FS) was completed during the same year, but the project did not advance to construction due to a drop in iron ore prices in 2016, along with political instability in the country.
Black Iron initiated a new preliminary economic assessment (PEA) for the project in 2017 with reduced initial scale and a phased development approach. A rescoped PEA was announced in March 2020 along with a revised mine life and strip ratio. The project envisions a two-stage development with an initial processing capacity of four million tonnes per annum (Mtpa), which will be expanded to 8Mtpa in stage two in the fifth year of operations.
The project is estimated to have a life of mine (LOM) of 17 years with pre-development capital for stages one and two estimated at $407.6m and $364.3m, respectively. Black Iron announced that the project development is continuing amidst Russia’s incursion into Eastern Ukraine with work being carried out as usual. A feasibility study for the project is currently ongoing.
Shymanivske iron ore project location and geology
The Shymanivske iron ore project is located approximately 330km south-east of Kyiv and 8km south-west from Kryvyi Rih in central Ukraine. The property lies in the iron ore mining district of KrivBass, the heart of mining and metallurgy in Ukraine, and encompasses an area of approximately 300ha.
The Symanivske property sits on the Kryvyi Rih Basin (KrivBass), a Paleoproterozoic synclinorium structure in the Archean Ukrainian Shield. The basin extends approximately 85km north and south respectively with widths varying from 2km to 10km. Biotite, biotitehornblende tonalite and microcline-plagioclase granite make up much of the Archean basement in addition to relics of mafic volcanic and ultramafic rocks.
Shymanivske mineralisation and reserves
The iron formation at Shymanivske is of the Lake Superior type. The banded sedimentary rocks comprise bands of iron oxides, magnetite and hematite within quartz or chert-rich rock. Variable amounts of silicate, carbonate and sulphide lithofacies are also present.
The measured and indicated mineral resources at the Shymanivske iron ore project were estimated at 188.3 million tonnes (Mt) grading 30.1% iron (Fe) as of March 2020.
Mining at Shymanivske iron ore project
The Shymanivske iron ore project will be operated as an open-pit mine with drilling and blasting followed by loading and hauling.
The pit design features an overall pit slope of 47o with 15m-high benches and a 10.6m-wide berm at every two benches. Mining operations at historic waste dumps sections will be conducted in 5m benches at a bench face angle of 50° with a 4.2m catch bench on every mining bench.
The pit is proposed to be approximately 1,200m-long with a surface width of 750m and a maximum depth of 300m from the surface. The proposed pit with a total surface area of two million square metres will be completely contained within the mining allotment.
The ramps and haul road were designed to support 228t rigid frame mining trucks, with an overall width of 31m.
Ore processing at Shymanivske
The processing plant design is based on the 2014 feasibility study, but the processing capacity has been adjusted to the re-scaled project from the original capacity of 35Mtpa. The new processing is based on a capacity of 4Mtpa of concentrate for stage one followed by the construction of a duplicate parallel processing line to increase production to 8Mtpa.
The run-of-mine (ROM) ore will undergo primary and secondary crushing in a gyratory crusher and two cone crushers, respectively. The crushed material will be conveyed to a single high0pressure grinding rolls (HPGR) unit. The HPGR product will be separated using the low-intensity magnetic separation (LIMS) method. The magnetic concentrate slurry will be ground in a ball mill operating in a closed circuit.
The overflows from the grinding circuit will be fed to a finisher magnetic separator (FMS). Concentrate from the FMS will be fed into a conditioning tank prior to undergoing reverse sulphur flotation and the resulting concentrate will pass through a magnetising coil and be fed to a high-rate thickener. The thickener underflow will be pumped to concentrate storage tanks prior to being pumped to the dewatering filters.
The concentrate will be filtered and pressed by four plate and frame filter presses with each filter capable of processing up to 300tph with a target moisture content of 9% filter cake product. The filter cake product will be conveyed to the concentrate stockpile for storage.
Offtake agreement of the Shymanivske iron ore project
The offtake rights for the initial 4Mt of production from the project was awarded to Cargill Metals, the metal business of global food corporation Cargill. Cargill will offtake the production for an initial term of ten years, as well as provide $75m financing for the construction of the project. The agreement is subject to the completion of due diligence and final negotiations.
The electrical power required for the project will be supplied from the existing 150kV Gornaya substation located 30km south-east of the project. A new 30km double-circuit 150kV overhead transmission line will supply power to the site. Emergency power is expected to be supplied by two diesel generating units.
The process water will be sourced by storm collection and make-up water from the Yuzhnaya Aeration Plant, a public potable water distribution facility, through a 9km pipeline. A 7km water pipeline from the Karachunovskoe Reservoir will supply potable water to the project.
In August 2017, Black Iron commissioned the engineering consulting group BBA to prepare the PEA for the project with input from geological and mining consultant Watts Griffis and McOuat (WGM).
Environmental Resources Management was engaged to conduct an environmental and social impact assessment (ESIA) for the project in March 2021.
Engineering company Wood was engaged to conduct work on an updated FS for the project in June 2021.
Fluor Transworld Services, a subsidiary of Fluor Corporation, was awarded the engineering, procurement, and construction management (EPCM) contract for the Shymanivske iron ore project in August 2013.
WorleyParsons Services Canada (WorleyParsons) was contracted to complete the original FS in January 2012.
The bankable feasibility study (BFS) was prepared with support from Lycopodium Minerals Canada, Soutex Mineral & Metallurgical Processing Consultants, WGM, Consulting Geologists and Engineers of Toronto, and P&E Mining Consultants.