Strategic Resources provides update on Port Saguenay iron pellet plant

MONTREAL — Strategic Resources Inc. announced that during the last quarter of 2023 the Company completed initial rounds of discussions with iron ore traders and potential strategic partners regarding its plans for a four million tonne per annum iron ore pellet plant at Port Saguenay. Based on the initial feedback on the pellet project, the Company has decided to prioritize the construction of a 4 mtpa iron ore pellet plant at Port Saguenay in Québec. Accordingly, consulting engineering firm, BBA was retained in Q4 2023 to study and update capital and operating costs for the larger pellet plant. They remain on track to deliver results in Q1 2024, building on the December 2023 indicative EPC cost estimate from Metso Corporation for the supply of the larger pelletizer unit.

Based on the above, the Company’s utility needs for its first phase of operations have been substantially reduced for both natural gas and electricity. Strategic had been granted electrical contracts under an older regime and has been working collaboratively with Hydro-Québec and the Provincial Government to align on the best actions as the existing electrical contracts for the BlackRock Project came up for renewal. Accordingly, the Company has decided to release its old electrical contracts with Hydro-Québec and forgo the associated letters of credit for electricity at the BlackRock Project. Through this process, the Company intends to recover surplus working capital into its treasury which can be used to advance the project. The Company plans to obtain a revised electricity contract in accordance with the new system established by the Government of Québec, coordinated by Hydro-Québec and the Government of Québec. It is expected that this process would be completed as part of the construction timeline. Hydro-Québec and the Government of Québec continue to be supportive of projects at Port Saguenay, including the recently announced port development plans and investment of C$111 million towards the Port’s conveyor system. Details about the procedures to obtain electrical utilities above 5 megawatts can be found at Ministère de l’Économie, de l’Innovation et de l’Énergie.

Strategic continues to work alongside the local, provincial and federal governments, the port authority, as well as local populations and indigenous groups to develop the BlackRock Project. To date, the Company and its major shareholders have made significant investments towards the development of this important project in Québec, which will help to reduce carbon emissions for the steel and foundry industries in North America and Europe.