Alderon, the company hoping to launch the Kami iron ore mine in western Labrador, says it only has about five weeks to secure access to power from Churchill Falls before it is forced to lay off workers and cancel contracts.
Alderon, which holds a majority stake in the project, maintains that it needs an industrial transmission line built to begin construction.
Executive chair Mark Morabito said the billion-dollar project cannot afford to wait much longer.
"We need this done now," Morabito told CBC News. "Otherwise Alderon is going to have to go into care and maintenance mode until it gets a power commitment. Unlike Vale or Exxon or other big companies, we don't have any revenue."
The line will cost about $300 million. Alderon says it is offering to pay $60 million toward the cost, which it describes as its "fair share" of the tab.
The Newfoundland and Labrador government supports building it, but has not approved the project or provided a timeline.
Decision needed soon: company
Morabito said the government needs to make a decision quickly.
"I can wait I guess until the end of February before I'd have to put in a very serious cash conservation plan, which would mean significant layoffs and contract cancellations — most of them local, to be perfectly frank," he said in an interview.
On Thursday, Alderon announced that it had signed an impacts and benefits agreement (IBA) with the Innu Nation.
"We are pleased with this IBA as it gives financial benefits to the Innu people and opportunities for business contracts and jobs as well as environmental protection for Innu traditional pursuits," Prote Poker, the grand chief of the Innu Nation, said in a statement.
The agreement will run as long as the mine is in production.
Alderon owns 75 per cent of the Kami project. The rest of the project is owned by Hebei Iron & Steel, which is the largest producer of steel in China.