China finds funding for iron ore junior in Labrador
While iron ore prices have been sliding, some businesses still believe the commodity supercycle is intact since Beaufield Resources (CVE:BFD), a junior with holdings in the Schefferville Iron district located in western Labrador, closed a significant financing with a Chinese firm announced on Thursday.
Hongkong Huaxin Petroleum Limited bought 9% of Beaufield, that is 10 million common shares at a price of 20 cents per share, for proceeds of $2 million. The Chinese investor, which paid a premium above the Beaufield's current trading price, is a subsidiary of China CEFC Energy Company Limited, which stores and transports oil and petrochemical products. In August Chairman Ye Jianming of CEFC came to Ottawa and met with Beaufield’s management to discuss an initial investment.
After the announcement Beasufield's stock was up 14% for the week to 15.5 cents a share.
In mid-August Beaufield announced the completion of a 22 hole drill program that showed ". . . several distinct geophysical anomalies as well as areas where high-grade iron".
"Hole Sc-12-01 located in the southern portion of the property targeted the southern extension of the Wollett Direct Shipping Ore (“DSO”) deposit (owned by Labrador Iron Mines) where historical IOCC drill holes encountered high-grade iron (60.5% Fe over 7.6 m and 48.4% Fe over 19.8 m)," said the company in a news release.
"The iron bearing formation extends for several kilometres onto Beaufield's ground."
Beaufield’s iron holdings are located within the Schefferville Iron district and shares boundaries with Tata Steel (NSE:TATASTEEL), New Millennium Iron Corp, Century Iron Mines (TSE:FER)) and Labrador Iron Mines (TSE:LIM). Tata and Labrador are developing DSO (Direct Shipping Ore) deposits within three kilometres of their boundary with Beaufield.
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