Nordic Iron Ore

Financial development

First quarter, 1 January – 31 March 2023
·         Sales amounted to SEK 0 million (0)
·         Earnings after tax amounted to SEK -2.7 million (-1.6)
·         Investments amounted to SEK -0.2 million (-2.3) in January-March
·         Earnings per share before and after dilution amounted to -0.08 SEK (-0.05)
·         Cash and cash equivalents amounted to SEK 1.7 million (5.7) on March 31, 2023.

Significant events during the first quarter 2023
·         The company entered into an agreement with VB Elnät to evaluate necessary measures in order to enable connection to the grid.
·         The short term debt facility of SEK 18.5 million with the company’s major shareholders Bengtsson’s Tidnings AB, Ludvika Holding AB and Kopparinvest AB as well as Board member Timo Lindborg AB through company, was prolonged to June 30, 2023.
·         In order to strengthen working capital, the company extended its credit facilities with SEK 3 million with the company’s two largest shareholders Bengtssons Tidnings AB and Ludvika Holding AB. The credit facilities thereby amounted to a total of SEK 21.5 million.
·         The company prolonged outstanding loans of SEK 21.5 million with the company’s three largest shareholders and a Board member. Repayment was prolonged by three months until September 30, 2023.

Significant events after the period
·         In order to strengthen working capital, the company extended its credit facilities with SEK 3 million with the company’s two largest shareholders Bengtssons Tidnings AB and Ludvika Holding AB. The loan extension has the same terms as prior loans, meaning an interest of 8 percent and these loans mature on September 30, 2023. The credit facilities thereby amounted to a total of SEK 24.5 million.

CEO comments
Dear Shareholder,
During the quarter we continued to work on completing an agreement with Cargill. There are only small number of items outstanding and we are hopeful to complete an agreement during the year. The purpose of these negotiations is for us to secure an extensive supply agreement as well as a long term investor and strategic partner that can strengthen Nordic Iron Ore. Furthermore, we have worked on clarifying the terms for the working time related to water operations in the Environmental Permit through discussions with the County Administrative Board, negotiated drafts of MOUs with potential suppliers and continued exploration at Blötberget with some exciting results.

Preparations continue
During the quarter, Nordic Iron Ore has continued to work on preparations ahead resuming mining operations at Blötberget. We have negotiated drafts of MOUs with potential suppliers of equipment and services to the mine. As both the processing plant and much of the machinery to be used down in the mine will consume significant amounts of electricity, we need to secure electricity supply to the mine. We have previously received approval on our application for a power outtake of 20 MW and signed a letter of intent with Hitachi Energy for the installation and operation of an electric power plant with a 50/12kV station. Furthermore, in order to secure initial power and ensure that the electric power plant can be connected to the grid, we have also signed an engineering agreement with VB Elnät to determine the required measures to access the initial power requirement. Additionally, work is underway to ensure access to necessary land, either through acquisitions or through easement, so that construction can begin as soon as an agreement with Cargill is finalized. In connection to this work we have identified alternative locations for some planned facilities which in turn has been notified to the County Administrative Board. We have also continued our dialogue with the County Administrative Board concerning clarification of the terms for the working time for the water operations in the Environmental Permit with the purpose of satisfying the terms for the water operations.

The Traffic Authority’s evaluation of our desired new connection to the railway at Skeppmora was sent on referral during the first quarter. We expect a final result from the evaluation during the second quarter this year and will thereafter decide how to proceed.

Negotiations with Cargill
We continue intensive negotiations with Cargill and have a positive outlook on completing negotiations regarding deliveries, investment and the future collaboration during the current year. Once the agreement is completed, the plan is to initiate work on the ground at Blötberget and begin the journey towards a modern, electrified and green mine.

According to current schedules and calculations, Nordic Iron Ore has a lead time of about three years before mining can start at Blötberget. The mine is expected to annually produce approximately 1.6 million tonnes of iron ore concentrate with an average iron concentration of 69%, one of the highest concentrations available on the market. Iron ore concentrate of this quality is an important component in reducing the CO2 intensity in the entire iron ore value chain while the planned electrical mining at Blötberget is expected to have a uniquely low CO2-intensity per tonne iron ore product.

Interesting results from exploration
In parallel, we have continued exploration of the area around Blötberget and also received a new exploration permit for the area last year. We have made new interesting observations in material that has previously not been analyzed and we also have plans to re-analyze previous samples in order to potentially broaden mineral resources with new substances, such as rare earth elements (REE). Our hope is that this work during the year will lead to a re-classification of certain mineral resources or that new ones are added. Regardless of whether we are successful or not, this work will lead to a better understanding of mineralization in Blötberget and lay a foundation for future exploration and drilling programs.

Focus going forward
In the short term, our focus is to complete a long-term collaboration agreement with Cargill and thereby secure important initial funding of ground work. We will also continue to strengthen the organization through necessary recruitments and secure partners and suppliers. I also look forward to keeping you posted on our continued exploration of Blötberget.

Ronne Hamerslag
CEO
Nordic Iron Ore AB (publ)
 
For additional information, please contact:
Ronne Hamerslag
Verkställande Direktör, Nordic Iron Ore AB
Telefon: 0240 88 301
E-mail: ronne.hamerslag@nordicironore.se

About Nordic Iron Ore
Nordic Iron Ore Group is a mining company with the ambition to revive and develop the iron ore production in the Ludvika area, with Blötberget being the first phase. The company also intends to expand its mineral resources, and upgrade them to ore reserves, primarily through exploration and other studies of the connecting Väsman field and Håksberg. The Company has all the necessary permits in place for the mine in Blötberget and will be able to produce iron ore of very high quality.
For more information, see www.nordicironore.se.
Nordic Iron Ore’s shares and warrants are listed at Nasdaq First North Growth Market. Wildeco is the company’s Certified Adviser (info@wildeco.se tel +46-8-545 271 00).