  The next generation neutrino observatory proposed by the LBNO collaboration
will address fundamental questions in particle and astroparticle physics. The
experiment consists of a far detector, in its first stage a 20 kt LAr double
phase TPC and a magnetised iron calorimeter, situated at 2300 km from CERN and
a near detector based on a high-pressure argon gas TPC. The long baseline
provides a unique opportunity to study neutrino flavour oscillations over their
1st and 2nd oscillation maxima exploring the $L/E$ behaviour, and
distinguishing effects arising from $\delta_{CP}$ and matter.
  In this paper we have reevaluated the physics potential of this setup for
determining the mass hierarchy (MH) and discovering CP-violation (CPV), using a
conventional neutrino beam from the CERN SPS with a power of 750 kW. We use
conservative assumptions on the knowledge of oscillation parameter priors and
systematic uncertainties. The impact of each systematic error and the precision
of oscillation prior is shown. We demonstrate that the first stage of LBNO can
determine unambiguously the MH to $>5\sigma$C.L. over the whole phase space. We
show that the statistical treatment of the experiment is of very high
importance, resulting in the conclusion that LBNO has $\sim$ 100% probability
to determine the MH in at most 4-5 years of running. Since the knowledge of MH
is indispensable to extract $\delta_{CP}$ from the data, the first LBNO phase
can convincingly give evidence for CPV on the $3\sigma$C.L. using today's
knowledge on oscillation parameters and realistic assumptions on the systematic
uncertainties.
