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February 22, 2010

Baffinland May Develop Nunavut Iron Mine in 2010

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It is said from president and CEO of Baffinland Iron Mines Corp. that it may be able to secure the cash to develop an iron mine in Nunavut this year.

Gordon McCreary said Sunday that Baffinland needs to raise at least $4 billion to develop the Mary River site 160 kilometres south of Pond Inlet on northern Baffin Island.

At least $1 billion of that funding must come from a partner for the project to proceed, he added.

“My view is that that will happen in 2010,” McCreary told reporters on Sunday, during a company-led tour of the Mary River site.

“If, for whatever reason, it doesn’t happen in 2010, my job as the CEO of this company is to make sure that we’re bridged into 2011, because it will happen in 2011.”While no deep-pocketed partners have come forward to date, economists predict that rising demand for iron ore will soon drive up prices, perhaps by as much as 30 per cent.

“It increases investor interest in them, and also increases the chance of getting that kind of strategic investment,” said Patricia Mohr, vice-president of industry and commodity research with Scotiabank.

McCreary said an investment would have made by now, had it not been for the global financial crisis that hit in 2008.

Baffinland organized Sunday’s tour for politicians, bureaucrats and journalists to view the Mary River site during the high-level meeting of G7 finance ministers and central bank governors in Iqaluit over the weekend.

None of the foreign finance ministers attended the tour, but McCreary said he met with Canadian Finance Minister Jim Flaherty for 45 minutes.

McCreary said he also met with the finance minister of Germany, which offered Baffinland $1.2 billion in loan guarantees last year.

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