Business
LIM Railway Agreement
LIM Railway Agreement.
About this update from Anglesey Mining Plc
[{"type":"text","content":"\n \n24 February 2011\n\nLIM signs Agreement with Tshiuetin Rail Transportation Inc. for Haulage of Iron \nOre\n\nAnglesey's 41% owned associate Labrador Iron Mines Holdings Limited (TSX: LIM)\nis pleased to report that it has signed an Agreement with Tshiuetin Rail\nTransportation Inc. (\"TSH\") for the transportation of iron-ore from LIM's\nSchefferville Area Direct Shipping Ore Project over the 235 kilometre TSH Railway, \nwhich connects Schefferville to the Emeril Junction, for the calendar year 2011.\n\nThe Agreement anticipates that iron ore will be hauled approximately eight\nmonths per year (April to November) with shipments on the TSH Rail commencing\nin April 2011 with the tonnage in calendar 2011 expected to be up to 2 million\ntonnes.\n\nIt is contemplated that a separate agreement between the parties will be\nconcluded for calendar 2012 and subsequent years. LIM's negotiations are\ncontinuing with other rail operators for the onward transportation of LIM's\niron ore from Emeril Junction to the Port of Sept-Iles.\n\nThe operation is expected to run for around 240 days, with about two trains\nevery three days. LIM will provide the locomotives, which will be leased by LIM\nand operated by TSH. Each train will comprise 120 rail cars and be\npowered by two robotized SD-40 locomotives. These rail cars will also be leased\nby LIM.\n\nLIM has agreed to advance to TSH a capacity reservation deposit of $750,000 to\nenable TSH to prepare for a smooth ramp up of its operations to ship LIM's iron\nore in calendar 2011 in accordance with LIM's operating requirements. TSH will\nrepay the reservation deposit over a two year period beginning in 2013 as a\ndeduction against monthly haulage rates.\n\nThe Agreement, which includes a confidential tariff and other terms,\nacknowledges that it is in the best interests of both parties that the TSH\nRailway be rehabilitated as soon as possible in 2011 and that additional\nrehabilitation and capital funding will be necessary to increase tonnage\ncapacity on the TSH Rail in subsequent years. The 2011 rehabilitation program\nis the first year of an estimated ten year rehabilitation program to be carried\nout by TSH.\n\nUnder the Agreement TSH and LIM have agreed to co-operate, and to co-operate\nwith others, on sourcing funding for the rehabilitation of the TSH Railway. To\nexpedite the rehabi...