NFE.V - Northern Iron Corp.
Northern Iron is a mineral exploration company focused on developing high quality iron ore opportunities in the Red Lake Mining Division of Ontario, Canada, which is a past-producing iron ore district. The Company is a 100% owner of five iron ore properties in the Red Lake district containing significant historical resources with grades ranging from 22% to 31% Fe2O3. Northern Iron is listed on the TSX Venture Exchange and commenced trading on 26 August 2011.
Northern Iron Corp Q1 Results Ending December 31st 2014
Price: $0.03
Common Shares: 95,727,875
Insider Holdings: Just under 25% as per www.sedi.ca
Cash: $1,355,590
Receivables: $9,431
Prepaid Amounts: $17,691
Deposits: $200,000
Property and Equipment: $258,339
Exploration Assets: $9,619,850
Total Assets: $11,460,900 or a net asset value of $0.12c a share.
Total Liabilities/Debt: $53,347(Accounts payable)
Quarterly cash burn rate: $177,701
MD&A Highlights
Future Outlook
The resource definition drilling program at the Griffith Mine commenced in August of 2012 and 11 holes totalling 3730m were completed by 21 September 2012. The holes were drilled around the perimeter of the North Pit. Past production indicated the higher grades and larger resource are located towards the South end of the pit. This should be the priority area for delineation drilling. It is estimated that a minimum of 10,000 metres will be required on the south-west and north-east. Fence drilling can be carried out from the East side, and fan drilling farther South.
Significant Events
On 16 October 2014, the Company announced that it has entered into an investment agreement with OMC Investments Limited (“OMC”), of Hong Kong. The transaction closed on 28 November 2014, and the Company issued 19,048,000 units of the Company (“Units”) by way of private placement at a price of $0.05 per unit, for aggregate proceeds of $952,400. OMC now holds approximately 19.9% of the issued and outstanding shares of the Company. Each Unit consists of one common share in the capital of Northern Iron and one common share purchase warrant (a “Warrant”). Each Warrant is exercisable for a period of three years from the date of closing of the Private Placement at an exercise price of $0.05. The Company also issued 15 common shares of its subsidiary Canadian Iron Metallics Inc. (Canadian Iron) to OMC, reducing its ownership share from 100% to 85%. Canadian Iron holds the Company’s interests in the Karas and Griffith’s properties. The value attributed to the noncontrolling interest in CIM on the closing date is nil. In addition, the shareholders’ agreement with OMC will allow OMC to progressively earn additional equity in CIM, up to a total of 70% of CIM’s issued and outstanding shares, as follows: · an additional 30% for $8.2 million in funding from OMC for dewatering, resource drilling and environmental permitting (“Resource Definition Funding”); · an additional 5% for $2 million in total funding for a preliminary economic assessment, funded 70% by OMC and 30% by Northern Iron; and · an additional 20% for $20 million in total funding for a feasibility study, funded 70% by OMC and 30% by Northern Iron, and assuming the feasibility study establishes technical and economic viability.
Should either party not fully contribute its share of funding to both the preliminary economic assessment and feasibility study, it may face dilution. In connection with this transaction, Northern Iron has also agreed to enter into an option agreement with OMC on its other mineral properties. Should OMC fund the full $8.2 million Resource Definition Funding, it has the right to acquire an 80% interest in either the El Sol, Whitemud and Papaonga properties. This may be increased to 90%, if within a five year period after earning 80%, OMC funds an additional $1.5 million in expenditures on the property chosen. This private placement is subject to final acceptance by the TSX Venture Exchange, and all of the securities issued in connection with it are subject to a statutory hold period expiring on 29 March 2015.
