Labrador Iron Mines Holdings Ltd. · OTC:LBRMF
Labrador Iron Mines — Investor Presentation (March 2014)
40 slides from Labrador Iron Mines's investor presentation, March 2014
Slide 1: Labrador Iron Mines Corporate Presentation
LABRADOR IRON MINES March 2014 Corporate Presentation`
Slide 2: Forward Looking Information
Forward Looking Information Labrador Iron Mines Holdings Limited (“LIM” or the “Company”) has prepared this presentation for information purposes only. The information contained herein was prepared by management on a best efforts basis and is believed to be accurate. It contains forward-looking stat
Slide 3: LIM is a Leader in Reactivating Iron Ore
LIM is a Leader in Reactivating Iron Ore Schefferville/Menihek Region, Labrador Trough LIM Advantages The Labrador Trough: Canada’s foremost iron ore producing region We’re currently one of only five iron ore producers in Canada We’re the only independently-owned iron ore producer in Canada Our proj
Slide 4: One of Only Five Iron Ore Producers in Canada
One of Only Five Iron Ore Producers in Canada Producers Mine Ownership 59% Iron Ore Company – Labrador City of Canada – Carol Lake 26% 15% – Mont Wright (QCM) 85% 15% – Fire Lake Mines Canada – Wabush Cliffs:100% Wabush WISCO 25% – Bloom Lake 75% Bloom Lake (Bloom Lake) Labrador – DSO Schefferville
Slide 5: Labrador Iron Mines: First Mover
Labrador Iron Mines: First Mover We are the first iron ore producer in the Schefferville/Menihek Area in 30 years James Mine is the first in a series of DSO deposits that LIM owns and plans to operate in Schefferville 5
Slide 6: LIM Third Year of Operations Completed
LIM Third Year of Operations Completed 2011 – 2013: of iron ore to China LIM iron ore sold (wmt) LIM is one of only a handful of Canadian 2013 LIM iron ore sales mining companies Production ~1.7 wet million tonnes currently exporting Target in 10 cape-size iron ore into seaborne Achieved shipments i
Slide 7: LIM: Iron Ore Sales
LIM: Iron Ore Sales 2-year sales agreement with Iron Ore Company of Canada (IOC): 100% of LIM’s production sold to IOC for two years (2013 and 2014) Continued working relationship with IOC: ü Use of ore handling facilities at Port ü Access to cape-size vessels (170,000 dwt) Product re-sold with pric
Slide 8: Off-take Financing with RB Metalloyd
Off-take Financing with RB Metalloyd US$35 million off-take financing LIM Strategic Advantage leading ü Provided important working international commodity capital for 2013 operating trading house season Pre-payment credited against ü Brings experience and expertise committed sales of 3.5 million in
Slide 9: Mine-to-Port Solution
Mine-to-Port Solution Mine and Process Rail Port and Sales – James + surrounding deposits – Life-of-mine agreements: – Ore handling facilities with access – LIM wet & dry process plants TSH, QNS&L: LIM spur line to cape-size vessels – Sinter and lump products – Railcar maintenance facility – Sales a
Slide 10: LIM's Portfolio
LIM’s Portfolio Eclipse (northwest – not shown on map) DSO North Zone Deposits (Stage 5) Trough 1 59.5 mt 57% Fe NI 43-101 Resource1 Wollett Central Zone (Stages 1, 2, 3) North Central (Stage 3) From 6 DSO deposits Fleming 9 Lance Ridge South Central (Stage 2) (James, Redmond, Denault, Knob Lake, Ho
Slide 11: With Access to Extensive Infrastructure
With Access to Extensive Infrastructure Hydro power Direct rail link to port LIM process plants (wet and dry) Roads, airstrip, town Hydro Power Connection LIM Wet Process Plant LIM Dry Process Stream Direct rail access to Port Town of Schefferville with airstrip Road access Labrador Iron Mines – TSX
Slide 12: LIM's Shipping Advantage
LIM’s Shipping Advantage Deep sea port ü on Atlantic seaboard » Access to markets: Europe, Asia and North America Shipping advantage to ü markets in North America and Europe » Shorter distance relative to other primary iron ore regions Current access to key Asian markets ü Western Europe (Rotterdam)
Slide 13: LIM's Operations
Labrador Iron Mines LIM’s Operations
Slide 14: James Mine: Third Year of Operations Completed
James Mine: Third Year of Operations Completed James Mine § James Mine: ~4.6 million tonnes ore mined and ~8.2 million tonnes waste removed in three operating seasons (2011, 2012, 2013) § 2013 Production: Mining mostly at James Mine; Initial mining at Redmond Mine (12 km from James): low strip ratio
Slide 15: Silver Yards Processing Facility
Silver Yards Processing Facility Wet beneficiation process plant + dry crushing and screening » Wet plant: Averaged ~65% recovery Phase 3 expansion completed in June in Q3 » WHIMS (wet high intensity magnetic separator) Target à ~75% recovery commissioned in July » Connection to grid power complete:
Slide 16: Silver Yards Processing Facility
Silver Yards Processing Facility § Silver Yards wet beneficiation plant 16
Slide 17: Silver Yards Processing Facility
Silver Yards Processing Facility § Triple deck dry system to crush and screen iron ore (no washing) 17
Slide 18: Operating Cost Savings Initiatives
Operating Cost Savings Initiatives Short to mid-term operating cost savings initiatives: 1. Mining equipment rates 6. Exploration costs 2. Human resources and staffing 7. Winter cost management 3. Fuel procurement 8. Rail car leasing rates 4. Aviation services 9. James Mine pit dewatering 5. Hydro-e
Slide 19: Operating Cost Savings Initiatives
Operating Cost Savings Initiatives Longer term strategic initiatives aimed at permanent structural reductions in operating costs and revenue deductions 1. Increased sales volumes 2. Re-negotiation of mining contract 3. Re-negotiation of railway tariffs 4. Alternative port arrangements at Sept-Îles 5
Slide 20: Stage 2 Houston Flagship Deposit
Stage 2 Houston Flagship Deposit When in full production, targeting ~2.5 million tonnes annually Houston Malcolm (NW extension) Stage 2 total resource 31.3 mt M+I @ 57.5% Fe 9.2 mt M+I @ 57.8% Fe 40.5 mt 57.6% Fe1 + 3.2 mt Inf @ 56.9% Fe + 0.5 mt Inf @ 56.4% Fe Upside Potential: Houston and Malcolm
Slide 21: Stage 2 Houston Flagship Deposit: Proposed Development
Stage 2 Houston Flagship Deposit Proposed Houston Development Phase 1initial Evaluating Development development 1 – revised lower capital development plan1: § Accesstrucked § Production road (10km) + bridge to Silver Yards for treatment and loading in initial years; Processing by on-site § New dedic
Slide 22: Strategic Relationship Established with TSMC
Strategic Relationship Established with TSMC Arrangements with Tata Steel Minerals Canada, subsidiary of Tata Steel Limited Multi-part cooperation agreements in areas of: Logistics Cost synergies; key logistics + infrastructure issues Rebuilding of rail line: Timmins plant to Silver Yards Property r
Slide 23: Joint Venture with TSMC: Howse Deposit
Joint Venture with TSMC: Howse Deposit Joint venture with TSMC to develop LIM’s Howse deposit; $30 million payment to LIM for 51% interest TSMC will increase up to 70% for additional $25 million investment Significant cost savings using TSMC’s Timmins plant (LIM plant relocation not required) LIM $5
Slide 24: Howse Targeted Development Timeline
Howse Targeted Development Timeline Joint Venture with TSMC (Tata is Operator) LIM $5M Exploration Program Resuming spring 2014 (drill program suspended in winter) Registration with Gov’t Nfld & Labrador Q1 ‘14 NI 43-101 Compliant Mineral Resource Spring/Summer 2014 Feasibility Study Fall 2014 Envir
Slide 25: Rail Operations
Rail Operations Life-of-Mine Rail Agreements in Place GWRR leases locomotives and (Genesee & Wyoming) operates LIM’s 6 km spur line TSH Railway to Emeril Junction in Labrador: ~200 km QNS&L to Port of Sept-Îles: ~360 km Three Operating LIM has railed 300 trains containing ~3.9 million Seasons wmt of
Slide 26: Enhancing Long-term Port Access
Enhancing Long-term Port Access New multi-user berth, Port of Sept-Îles: 5 mt capacity Progress: reserved Port indicates project completion LIM would benefit from first-mover advantage as mid-2014; $220M budget current producer Dredging completed Oct ‘12 Estimated CAPEX $220 million for multi-user b
Slide 27: LIM Successful Exploration
LIM Successful Exploration Resources continue to expand: 59.5 million tonnes ↑33% YOY Stage 2 Houston & Malcolm significant increase: doubled to 40.6 million tonnes Houston 31.3 mt @ 57.5% Fe (↑37%); Malcolm 9.2 mt @ 57.6% Fe (more than triple) Initial resource for stockpiles to supplement plant fee
Slide 28: Elizabeth Taconite Project First Resource
Elizabeth Taconite Project First Resource LIM’s exploration efforts have identified large iron orebody § 620 million tonnes inferred @ 31.8% Fe1 § Exploration potential of 350 – 600 million tonnes @ 31.9% Fe1 § Alongside existing infrastructure (roads, rail bed and power line corridor); § 4 km from
Slide 29: Agreements with First Nations
Agreements with First Nations Impact and Benefit Agreements Social License to Operate July 2008 Innu Nation of Labrador (left) Naskapi Nation of Local employment September 2010 Kawawachikamach (2nd from left) Training programs June 2011 Innu Matimekush-Lac John (2nd from right) Business opportunitie
Slide 30: Planning for the 2014 Operating Season
Planning for the 2014 Operating Season § 2013 sales volume achieved, but at the expense of product quality § Ore quality problems + significant capital investment put considerable strain on LIM’s cash resources § Large net losses reported and negative cash generation during 2013 operating season § N
Slide 31: Planning for the 2014 Operating Season
Planning for the 2014 Operating Season Focus Cost reduction and product quality § Critical assessment of various operating scenarios » James: economics of extracting remaining resources + southern extension » Houston Development – better quality: initial $20 million capital (subject to financing) §
Slide 32: Planning for the 2014 Operating Season: Financing Objectives
Planning for the 2014 Operating Season Financing Objectives § Currently negotiating various financing alternatives § Subject to completing financings, LIM believes it will have sufficient working capital to continue to operate over the next year § In the meantime, prudent management of cash resource
Slide 33: Outlook
Outlook1 2014 Operating Season: Detailed planning underway; assessment of various operating scenarios Focus on cost reduction and product quality Stage 2 Houston planning: evaluating development of Houston Project for potential production in 2014 (subject to financing) Stage 3 Howse (JV with Tata):
Slide 34: Appendix
Labrador Iron Mines Appendix
Slide 35: LIM Advantage: We're in the Labrador Trough
LIM Advantage: We're in the Labrador Trough Labrador Trough: Most Prolific Iron Ore Region in Canada § Canada’s foremost iron ore producing region » 99% of Canada’s current production Labrador Iron Mines » In continuous production since 1954 » Existing rail and port infrastructure » Politically stab
Slide 36: LIM Executive Team
LIM Executive Team John Kearney Mining executive with over 40 years of industry experience; Chairman and CEO of numerous mining Chairman & CEO companies Rod Cooper Over 30 years of experience in resource industry; previously held positions as VP and Senior Analyst, President & COO Mining, with Dunde
Slide 37: LIM Board of Directors
LIM Board of Directors John Kearney Mining executive with over 40 years of industry experience; Chairman & CEO Chairman and CEO of numerous mining companies. Bill Hooley Professional mining engineer with 40 years experience. Vice Chairman CEO of Anglesey Mining plc and former President & COO of LIM.
Slide 38: LIM Resources
LIM Resources1,2 (Refer to Technical Reports on SEDAR) Stage 1 and 2 Deposits Stage 3 Deposits- North Central Stage 1A and 1B Deposits Indicated (000t) Stage 3 (000t) NI 43-101 Compliant Historical (Non NI 43-101 Compliant)2 James (Central) 3,500 Howse3 25,700 Redmond (Central) 2,900 Barney 5,700 De
Slide 39: LIM Process Flowsheet
LIM Process Flowsheet Labrador Iron Mines – TSX: LIM 39
Slide 40: Labrador Iron Mines Contact
LABRADOR IRON MINES John F. Kearney Chairman and CEO Rod Cooper President and COO Investor Relations Contact Keren Yun VP, Investor Relations & Communications Main Office 220 Bay Street, Suite 700 Toronto, ON, M5J 2W4 Tel: (647) 728-4125 Fax: (416) 368-5344 www.labradorironmines.ca
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