Century Global Commodities owns some of the largest iron ore resources in Canada

Flagship Joyce Lake project is advancing rapidly to capture the strong market CEO Sandy Chim has a track record of raising capital in Australia, the UK, Hong Kong, and Canada Century has two key strategic partners — Baowu Steel Group and Minmetals What Century Global Commodities does: Century Global Commodities Corporation (TSE:CNT) (OTCMKTS:CEUMF) owns some of the largest iron ore resources in Canada, totaling some 20 billion tonnes in multiple deposits across five projects in Quebec and Newfoundland and Labrador. This total includes the Joyce Lake DSO Iron Ore Project, Hayot Lake, Full Moon, Black-Bird and the Duncan Lake project.  The company’s flagship Joyce Lake is a simple quarry operation with a bankable feasibility study already completed, while Full Moon and Duncan Lake, both have completed preliminary economic assessments. These three advanced projects alone have a combined after-tax net present value (NPV) of over $5 billion, calculated using iron ore prices that are well below trading prices seen today.  Century is led by founder CEO and Chairman Sandy Chim, a mining industry veteran, who has an extensive track record of raising capital in Australia, the UK, Hong Kong, and Canada. A chartered accountant, Chim has already secured two key strategic partners — Baowu Steel Group and Minmetals — Global Fortune 500 companies who have provided both financial and technical support to Century. The two Chinese state-owned companies together hold close to a 30% shareholding in Century. How is it doing: On February 10, Century reported a total comprehensive income of $1.9 million for the nine months ended December 31, 2020, compared with a loss of $3.6 million for the same period a year earlier. The company chalked up the $1.9 million sum to operating net income from subsidiary Century Food, which operates in the Hong Kong food segment, as well as two accretive corporate transactions. The resource exploration company with iron ore projects in Canada has the wind in its sails as the price of iron ore has climbed 80% over the past 12 months and is now in a sustainable recovery. In the first few months of this year, the price averaged close to US$170 a tonne. Century is set to enjoy the upside of a potential iron ore super-cycle through rapidly advancing its Joyce Lake DSO Iron Ore Project to production to maximize return. Joyce already has a completed feasibility study and a prepared environmental impact study. To advance project permitting, only updating of various studies is necessary, which has already started. “The speed that Joyce can deliver ore puts Century in a favorable position to catch this robust and sustainable price upcycle,” Chim said in a recent interview with Proactive. Additionally, if warranted, Chim said the company can also take advantage of the iron ore futures market, which “enables contracts of up to four years, providing us the ability to lock in a substantial portion of our production.” Joyce can operate at 2.5 million product tonnes per annum and it intends to take full advantage of that capability to maximize exposure to the iron ore price upcycle. To seize the opportunity presented by a strong recovery in the global iron ore market, Century plans to spin-out Joyce. The Joyce feasibility study demonstrates that at a projected price of US$142.50/t, the post-tax NPV, over a 5-7 year mine life, is greater than C$500 million.  “The Joyce Lake spin-out will be consistent with accretive raising additional capital to fund an optimization of the study and to advance Joyce to a production decision,” the company said in a statement. Joyce’s iron ore is high-grade at about 62% Fe and it does not require any beneficiation. The project requires simple open pit mining, crushing and screening, just like a quarry, so there are no tailings generated. As such, equipment required for mining and crushing is simple and standard because a large processing plant is not required, capital intensity is reduced to US$11/t, which is a fraction of the current selling price of US$160-170/t. “Again, because it is simple compared to traditional iron ore projects that require large processing plants, Joyce will only take one and half years, after a production decision, to reach full production,” said Chim. Inflection points: Spin-out of the Joyce Lake DSO and any capital raises to fund the project Updating and optimizing the Joyce feasibility study and environmental studies Maximizing the upside of a potential iron ore super-cycle through quick production What the boss says: In a recent interview with Proactive, Century Global Commodities CEO and Chairman Sandy Chim said: “The robust and sustainable price outlook opens a huge window of opportunity for Century to quickly bring Joyce to production while sequentially over time also developing its other high-volume projects to realize a combined Net Present Value of some $5 billion for its top three projects.” “Joyce can operate at 2.5 million product tonnes per annum and we intend to take full advantage of that capability to maximize exposure to the price upcycle. The robust price forecast and rapidly advancing Joyce to production is important for us to maximize return,” he added. Contact the author Uttara Choudhury at uttara@proactiveinvestors.com Follow her on Twitter: @UttaraProactive