3 July 08
Anglesey Mining plc (the company) is pleased to report today on excellent operational progress in Labrador and also in respect of the Parys Mountain sale announced on 10 April 2008.
The Schefferville report which follows has been extracted from an announcement made in Toronto on 2 July 2008 which also dealt with the approval and publication of the Labrador annual financial statements, which are available on SEDAR at http://www.sedar.com. The company has a 50% ownership interest in the Labrador operations.
Labrador Iron Mines (LIM) is focused on the development of direct shipping iron ore in the Labrador Trough, in the Province of Newfoundland and Labrador, near Schefferville, Quebec (the “Schefferville Project”).
Following the IPO, LIM commenced plans to complete a program of verification drilling and bulk sampling on certain of the properties and the calculation of a compliant mineral resource, leading to the undertaking of a detailed engineering study of mining these hematite deposits to produce “direct shipping” lump and sinter fine ore, which will require minimal processing, for sale to European and Far Eastern steelmakers.
During the ensuing months, LIM expanded its management and operating team with a number of senior appointments, initiated further activities to advance the development stages of the Project and awarded various contracts, including environmental baseline studies, detailed exploration drilling, bulk sampling, resource estimation, metallurgical process testing, rail and port studies and engineering design, all directed to move the Schefferville Project forward towards initial production targeted for 2009.
SNC-Lavalin, in conjunction with Geostat and with participation by the Labrador Innu Development Limited Partnership, has been awarded a contract for a Resource and Engineering Study, including detailed engineering design and specifications for major items of plant and infrastructure. This will include metallurgical test-work aimed at the design of a process circuit required to meet market specifications for the particular types of iron ore.
A major reverse circulation drilling contract has been let to Cabo Drilling Corp. to provide data for a compliant resource estimate on the various deposits, including a reserve estimate on the Phase One Properties, and to assist with both short term mine planning and with longer term operational planning. It is expected that this program will start in July 2008 and will be supplemented by an exploration trenching program.
RSM Mining Services Inc. from Labrador City has commenced a summer program to excavate an 8,000 tonnes ore bulk sample from the Phase One deposits closest to Schefferville and to treat this material by crushing, screening and washing to replicate the expected final product. Some of this material will be used in the metallurgical testing program and the remainder will be available for bulk samples and market testing by potential iron ore buyers.
LIM has submitted the Project Registration Application for the first phase of development of the Schefferville Project to the Department of Environment and Conservation in the Province of Newfoundland and Labrador and to the Canadian Environmental Assessment Agency (CEAA). The Project Registration Documentation addresses production from the first phase of the Schefferville Project, being the James North, James South and Redmond properties. The development plan calls for the initial production of about 500,000 tonnes of iron ore in 2009 and building up to three million tonnes in 2011.
LIM has entered into a Memorandum of Understanding with the Labrador Innu Association, representing the Sheshatshiu Innu First Nation and the Mushuau Innu First Nation, respectively, living in the communities of Sheshatshiu and Natuashish, Labrador reflecting the agreement of the parties with respect to community support for the development of the Schefferville Project and their joint commitment to negotiate and enter into a more detailed impact and benefits agreement.
LIM plans the commencement of commercial production of iron ore from the deposits located on the Schefferville Property at the earliest opportunity and, subject to receipt of permits, is working to bring Phase One of the Project into production in 2009.
The signature of a term sheet between the company and Western Metals Limited of Perth, Western Australia was announced on 10 April 2008. Since then significant progress has been made in documenting a comprehensive and binding Sale and Purchase Agreement. Similar progress is reported by Western Metals in respect of the due diligence exercise which they are conducting. The company expects to be able to notify a date for the EGM which will be required to gain shareholder approval for the transaction in the near future.
Bill Hooley, Anglesey’s Chief Executive, commented: “Progress on both these fronts is very encouraging and in line with our stated plans. We have been able to recruit an excellent team in Canada for the Schefferville project and this team is engaging efficiently with the development of the production facilities. We are looking forward to a very active few months on site at those iron ore deposits which are scheduled for early production.
We are also very encouraged by progress made by Western Metals and by ourselves and our advisors in moving the sale of Parys Mountain forward. We continue to believe that this route offers the best opportunity for the company to realise value from Parys Mountain in an acceptable time frame.
At today’s market and currency values, Anglesey’s shareholding in Labrador Iron Mines Holdings Limited, the Toronto listed company which operates the Schefferville Project, is worth 23.5 pence per Anglesey share. This is in addition to the company’s other assets, and we believe that that the market price of LIM should increase significantly as it moves closer to production.”
For further information:
Bill Hooley, Chief Executive
+(44) 1492 541981
Ian Cuthbertson, Finance Director
+(44) 1248 361333
Anglesey Mining plc is a UK based company listed on the London Stock Exchange with a 50% interest in a 90 million ton iron ore project in Labrador, Canada, which is under active development towards mining production in 2009. The company's Parys Mountain base metals project is in the process of sale to Western Metals Limited, an ASX-listed company which proposes to spend over £5 million on project development and feasibility.
|Anglesey Mining plc
Parys Mountain, Amlwch,
Anglesey, LL68 9RE, UK
|Phone +44 1248 361333