It could be used anywhere, with the following conditions:
- You fire those bits of iron at greater than solar escape velocity and aim the trajectory so that they won't hit anyone on the way out of the solar system
- You fire them in such a way that they will deliberately hit something (eg. the Moon) in such a way that they are then easily mine-able
- You fire them on a trajectory that ultimately ends in the sun
All of these require calculation of the trajectory carfully to ensure they won't hit anything they aren't supposed to.
I would expect that of these 3 options, number 2 would be best, as it doesn't waste resources, but to be honest they are all a bit fraught with danger.
Instead, why not use the asteroid as a base to launch your space craft from? The mass ratios work much better this way.