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Labrador Iron Mines Completes Joint Venture With Tata Steel Minerals Canada to Develop Howse Deposit



Labrador Iron Mines Completes Joint Venture With Tata Steel Minerals Canada to Develop Howse Deposit




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Labrador Iron Mines Holdings Limited (“LIM” or the “Company”) (TSX: LIM) is pleased to report that the previously announced joint venture with Tata Steel Minerals Canada Ltd. (“TSMC”) for the exploration and development of LIM’s Howse iron ore deposit in the Schefferville region of the Labrador Trough has been completed. The Howse Deposit is located in Labrador about 25 kilometres north of LIM’s currently producing James Mine and Silver Yards processing facility and adjacent to TSMC’s Timmins Area mines and new processing plant. The Howse Deposit has a historical resource of 28 million tonnes at a grade of 58% Fe (natural basis). Under the terms of the joint venture agreement, TSMC and LIM have agreed to form an unincorporated joint venture (the “Joint Venture”) pursuant to which Howse Minerals Limited, a wholly owned subsidiary of TSMC (“HML”), has acquired an initial 51% participating interest in the Howse Property for a total cash consideration of $30 million. As part of the Joint Venture, LIM will conduct a $5 million exploration program on the Howse Property over the course of the 2013 calendar year. The exploration program will comprise a targeted 70 holes with up to 10,000 metres of drilling. The objective of the drill program is to convert the historical resources to National Instrument 43-101 (“NI 43-101”) compliant mineral resources by spring 2014 and to collect metallurgical, geotechnical, hydrogeological, and hydrology information to advance Howse towards production. Following completion of LIM’s $5 million exploration program, and the calculation of a new NI 43-101 resource, HML shall contribute the next $23.5 million to the Joint Venture and thereby increase its participating interest in the Howse Deposit to 70%. It is currently planned to complete a feasibility study by July 2014, with a target for commencement of mine development in 2015 and commercial production in 2016. "Completion of the Howse joint venture agreement with TSMC is an important step forward for LIM and will significantly fast track the development timeline for this new mine” commented John Kearney, LIM’s Chairman and Chief Executive Officer. “We are very pleased to be cooperating with Tata Steel, one of the world’s major steel companies, in this venture and we look forward to working with TSMC to advance the Howse project into production.” Originally part of LIM’s planned Stage 3, the Howse Deposit was expected to be developed about 2020. The Joint Venture with TSMC is expected to expedite the start of production by 2016 and should also result in significant cost savings and synergies due to the accessibility of the Howse Deposit to TSMC’s year round processing plant. Project Name Labrador Iron Mines Completes Joint Venture With Tata Steel Minerals Canada to Develop Howse Deposit Location Canada Commence 2013 Completion -NA- Estimated Investment $30 million USD Capacity -NA- Key Players Labrador Iron Mines