Tata Steel Minerals Canada (TSMC), a joint venture between New Millennium Iron Corporation (NML) and Tata Steel, has signed a ‘life of mine' agreement for development of NML's direct shipping iron ore (DSO) project located in western Labrador and north eastern Quebec.

NML has also announced the start of mobilisation to commence construction this summer.

Tata Steel has already entrenched interests in New Millenium, which owns one of the largest untapped reserves of magnetite in the world (low grade ore but can be upgraded through pelletisation process).

Tatas intend to provide long-term iron ore security to Corus, which was without captive resources, through New Millenium. A Bombay House senior executive told Business Line on Friday that the deal marked further progress in Corus' ore supply.

The agreement, signed on June 8 with the local government of the area, a Canadian aborigine reserve, signifies the community's consent and support to the DSO project. The deal is also meant to benefit the community through training, employment, business opportunities and financial participation in the project.

Tata Steel owns approximately 27.1 per cent of New Millennium (NML) and is the largest shareholder and strategic partner of the Canadian company.

Meanwhile, NML has changed its name from New Millennium Capital Corporation to New Millennium Iron Corporation. Effective since June 15, the ordinary shares of the NML commenced trading on the Toronto Stock Exchange's fledgling venture platform — Venture Exchange (TSX-V) — under the name New Millennium Iron Corp.

NML owns rights to the Millennium Iron Range, located in the Canadian province of Newfoundland, Labrador and Quebec.In the lease area the company is advancing its DSO project to a near-term production, a communication to TSX said.

Iron ore reserves

Tata Steel has exercised its exclusive option to participate in the DSO project and has a commitment to take the resulting production.

Tata Steel also has exercised its exclusive right to negotiate and settle a proposed transaction in respect to the LabMag Project and the KéMag Project.

LabMag contains 3.5 billion tonnes of proven and probable reserves at a grade of 29.6 per cent Fe plus 1 billion tonnes of measured and indicated resources at an average grade of 29.5 per cent Fe and 1.2 billion tonnes of inferred resources at an average grade of 29.3 per cent Fe.

DSO project contains 64.1 million tonnes of proven and probable reserves at an average grade of 58.8 per cent iron, 8.1 million tonnes of measured and indicated mineral resources at an average grade of 58.8 per cent iron, 7.2 million tonnes of inferred resources at an average grade of 56.8 per cent iron.

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