Salt Lake City, UT, May 8, 2008. Iron County apparently is on the verge of an iron ore mining revival.

This fall, Palladon Ventures Ltd. plans to begin extracting crude iron ore from the Comstock and Mountain Lion open-pit mines in the desert mountains west of Cedar City, mines that originally supplied iron ore to the Geneva Steel mill when it was built during World War II. The mines have been dormant for a quarter of a century.

Palladon announced last month that it had signed a five-year contract to deliver iron ore to China Kingdom International, which Palladon described to investors as a large company that has offices in China, Australia and London. Investors also were told the Asian company operates a steel mill near Beijing; has interests in poultry, textile and seafood-export businesses; and employs nearly 6,000 employees.

"The five-year contract will gross the company over $1 billion," claimed Donald Foot Jr., president of Palladon Iron Corp., which will conduct the operation as a wholly owned subsidiary of Palladon Ventures and its venture capital financial supporter, Luxor Capital Group. Multiple calls to Palladon's Salt Lake City office seeking additional information were not returned by Foot or company Vice President Frank Dolce.

But in an April 4 conference call with investors, Foot said Palladon is on track to complete the infrastructure improvements that will be needed to begin producing iron ore in the year's third quarter.

"We are in great position where we will sell run-of-mine [crude] ore to start the operation," he said. "All we have to do is drill it, blast it, crush, blend, stockpile and ship."

Foot also predicted Palladon will complete construction of an ore concentrator before the contract ends, allowing it to supply higher-grade iron ore at a much higher price per ton.

Iron ore is in great demand, driven largely by industrial expansion in China and India.

Brazilian mining company Vale do Rio Doce, the world's biggest producer, struck a deal in February with six Asian steelmakers that helped increase global iron ore prices by 65 percent. A report Tuesday from Australia noted that employment nationally rose by 10,000 in April, the 18th consecutive month of increases, as mining companies hired more workers to meet Chinese demand for iron ore and coal.

"We've already seen projections for another significant [price] increase next year," Foot added. "We find ourselves at a robust time in the market to be going into production."

Palladon’s plans were welcomed by Bryan Dangerfield, the Iron County/Cedar City economic development director.

"It's huge. It's high-paying jobs. Everything we want to have here, it provides," he said, noting that company officials indicated the operations will provide about 60 jobs paying two to three times the county's average non-farm annual wage ($25,404). "That's the focus of my office - high-paying jobs."

Added Chad Nay, Iron County's building official and zoning administrator: "We're excited to see them rejuvenate the mine. They've worked with us for permits on upgrading their power substations to make it more modern and compatible with the commercial power they will bring in."

A Palladon news release said work began Monday to install electric lines connecting a new substation to the Cedar City power grid.

In the next few months, the company will install crushing, stacking and loading equipment so iron ore can be shipped by rail to a West Coast port, where China Kingdom International ships will ferry it across the Pacific.

To get the ore to Union Pacific's westbound trains, Foot said Palladon is spending $1.2 million to upgrade 14.4 miles of a spur line. That work is scheduled for this summer.