La Fosse sees profit potential in manganese, sinter and lump ore

A Toronto-based junior is hoping to make a pile of money through the sale of several products from a former producing iron ore district in the province’s northeast. La Fosse Platinum (TSE) is gearing up this summer for full- scale production in 1991, through its wholly owned subsidiary Hollinger North Shore Exploration, of sinter and lump iron ore and manganese ore.

The Northern Miner recently toured the Schefferville properties La Fosse purchased in 1988 from the Iron Ore Co. of Canada (IOC) for $140,000. The end-of-May visit featured a stopover in Schefferville — a pale reflection of its glory years when the IOC was active in the area — and a helicopter flight to view a lump ore deposit (Sawyer Lake), 30 miles southeast of the town.

La Fosse has identified more than 40 manganese ore sources with in- place grades of 12-50% manganese; 27 of the deposits were uncovered in 1989. The company intends to upgrade these ores to a 45% (or better) manganese lump product by crushing, screening and treatment in a 1,000-ton-per-day heavy mineral separation plant.

The company has been stockpiling manganese ore at an old IOC warehouse in Schefferville, where a washer is to be installed for sampling purposes. “I’m hoping to get it going by June 15,” Chairman Peter Ferderber said of the preliminary ore treatment.

Planned is the processing of 20,000 tons of ore this summer at Elkem’s Beauharnois, Que., ferromanganese smelter. All going well, the company will then spend the winter stockpiling the ore for “a big start in 1991,” Ferderber said.

Manganese, whose major application is as an alloying element in steel, is sold delivered to rail or vessel at the nearest port to the producer’s plant, President Fenton Scott explained. In May, a price of US$3.95-4 per tonne (delivered) was quoted for 48% manganese ore carrying less than 0.1% phosphorus.

More than 90% of the total consumption of manganese is in the production of steel. In mild steels it acts as a deoxidizer and a desulphurizer, preventing rupturing during hot rolling, forging and other processes.

Open pit operations are planned by La Fosse for the manganese ore, with mining confined to the May 15-Oct. 15 period. Finer material produced will be upgraded to a marketable commodity. A preliminary reserve estimate of about 3.3 million tons is indicated.

La Fosse is planning manganese production of about 270,000 tons per year, equal to about 40% of North American consumption. Scott said there is no current manganese production in either Canada or the U.S. (The Soviet Union is the top world producer of manganese, followed by South Africa.)

The lump iron ore mined by La Fosse will be sold either for direct reduced iron production or for blast furnaces.

For direct reduced iron production, the company says the material should carry 67.5% iron and no unwanted impurities, such as sulphur, titanium and phosphorus. La Fosse says it has three deposits capable of producing this material: Sawyer Lake, Astray Lake and Houston.

The initial producer will be Sawyer Lake, which contains about five million tons of ore in the probable category and 4.8 million tons in the possible category. Scott said about 75% of this material should pass the 67.5% threshold, and the remainder sell as standard blast furnace lump, with more than 64% iron.

Demand for lump ores has been on the rise and commanding a better price than finer materials, Scott says.

To mine the Sawyer Lake deposit, a 7-mile haul road will be built to a lake, where the material will be placed on a barge and transported to a rail line for shipment to Schefferville. Material will be crushed and screened to 1/4-inch-to- one-inch size. Vice-President Daniel Gosselin said the company is hoping to have the Sawyer Lake deposit in operation by mid-August.

In full production, La Fosse says, the three deposits should be capable of producing more than one million tons per year.

Lump iron ore for blast furnaces will be produced, La Fosse says, from lower-grade material from the Astray Lake and Houston deposits and lump material screened out in the sinter ore upgrading plant.

La Fosse says sinter ore for blast furnaces exists in many Schefferville mines. The potential, it estimates, tops 150 million tons.

The James mine will provide the initial production. Annual production of 1.5 million tons is possible, the company says.

To meet customer requirements, the sinter ore will be screened and washed and the fine material discarded. Waste will be pumped as a slurry to an abandoned mine.

La Fosse has three other deposits partially stripped for sinter ore production.