Labrador Iron Mines Holdings Ltd. · OTC:LBRMF
Labrador Iron Mines — Technical Presentation (March 2021)
29 slides from Labrador Iron Mines's technical presentation, March 2021
Slide 1: Labrador Iron Mines Houston Project Preliminary Economic Assessment
Labrador Iron Mines Houston Project Preliminary Economic Assessment March 2021
Slide 2: Forward Looking Information and Cautionary Statements
Forward Looking Information and Cautionary Statements Labrador Iron Mines Holdings Limited (“LIMH”, “LIM” or the “Company”) has prepared this presentation for information purposes only. It contains forward-looking statements about the Company's plans for the exploration, development, and mining of i
Slide 3: Experienced Mine Developer
Experienced Mine Developer In 2011, LIM Achieved First Iron Ore Production in the Schefferville Region in 30 years ‘s Iron Ore Projects ‘s Advantages Schefferville Region, Labrador Trough 15 Years Experience in Labrador 5 years in exploration & development (2005 – 2010) 5 years construction & mining
Slide 4: Mining Experience
Mining Experience James Mine: Three Successful Operating Seasons (2011-2013) ~4.6 million tonnes of ore mined ~8.2 million tonnes of waste rock removed Labrador Iron Mines 4
Slide 5: Houston Project PEA Key Takeaways
Houston Project Preliminary Economic Assessment (PEA) Key Takeaways Updated Resource Estimate 2 million tonnes / year for 12-year mine life High grade (>62% Fe) lump and sinter fines Low Capital Costs Strong Projected Economics Ready for Construction Houston Northern Access Road Houston Massive Hema
Slide 6: Houston PEA & Technical Report
Houston PEA & Technical Report • The independent PEA and Technical Report was prepared by Roscoe Postle Associates Inc. (RPA), now part of SLR Consulting Ltd. • Technical Report effective date: December 31, 2020 Qualified Person Title Technical Report Responsibilities Glen Ehasoo, P.Eng. Principal M
Slide 7: Location of Houston Project
Location of Houston Project Eclipse Houston & Malcolm (northwest – not shown on map) North Zone 4 mineralized deposits – • Houston 1, Houston 2, Trough 1 Houston 3 in Labrador, • Malcolm in Quebec Central Zone 15 km from the town of Wollet t Lance North Central Schefferville Fleming 9 Ridge Elizabet
Slide 8: Houston Project Updated Mineral Resource Estimate
Houston Project Updated Mineral Resource Estimate Mineral Resource Estimate Tonnes Fe SiO2 Mn P Al2O3 Category (Mdmt) % % % % % Measured 11.4 62.7 6.8 0.52 0.07 0.68 Indicated 9.1 62.7 7.3 0.41 0.06 0.54 M+I 20.5 62.7 7.0 0.47 0.06 0.62 Inferred 14.3 59.4 13.7 1.02 0.07 0.83 Houston and Malcolm depo
Slide 9: Houston Bulk Sampling Program
Houston Project Houston Bulk Sampling Program Labrador Iron Mines 9
Slide 10: Houston Hematite
Houston Hematite Houston banded iron formation Houston massive hematite dipping 45⁰ Labrador Iron Mines 10
Slide 11: Houston Project PEA Development Plan
Houston Project PEA Development Plan Mining Operations - Year-round ~5,500 tonnes / day - Mining Dry Crush and Screen Rail Operations – May to November Dry Crushing and Screening Plant ~10,000 tonnes /day - Rail ~2,000,000 tonnes / year production New rail siding Houston 1 & 2, rail and road permitt
Slide 12: Houston Project site layout map
643000 E 645000 E 649000 E 651000 E 6069000 N 6069000 N MALCOLM NORTH PIT DRY SIZING PLANT MALCOLM SOUTH PIT EXISTING TSH RAILWAY MALCOLM HAUL ROAD 6067000 N 6067000 N GILLING LOUISE LAKE LAKE 6065000 N HOUSTON 2 PIT 6065000 N BAKER HOUSTON 1 PIT LAKE 2000 m OBOE LAKE HOUSTON BRIDGE HOUSTON PROJECT
Slide 13: Permitting and Community Support
Permitting and Community Support • Permitting • Houston 1 and 2 completed full regulatory review and permitting for construction • Houston 1 and 2 support production in the first five years of operations • Malcolm will be permitted in Quebec with production in year 6 of the mine life • Houston 3 wil
Slide 14: Relationships with First Nations
Relationships with First Nations Social License to Operate Impact and Benefit Agreements Local employment July 2008 Innu Nation of Labrador (left) Training programs September 2010 Naskapi Nation of Kawawachikamach (2nd from left) Business opportunities June 2011 Innu Matimekush-Lac John Community en
Slide 15: PEA Production by Deposit
PEA Production by Deposit Production Schedule High Grade Total Fe SiO2 P Mn Al2O3 Strip Pit Iron Domain Mined (%) (%) (%) (%) (%) Ratio (Mdmt) (Mdmt) Houston 1 6.1 62.3 7.1 0.08 0.60 0.64 1.4:1 14.6 Houston 2 4.5 62.7 7.2 0.05 0.44 0.72 2.2:1 14.3 Houston 3 8.1 61.8 8.5 0.06 0.50 0.61 2.9:1 31.3 Mal
Slide 16: PEA Production Schedule
PEA Production Schedule lm RoM High Grade Iron Domain (Mt) Gl Waste (Mt) ==RoM High Grade Iron Domain (% Fe) ==@RoM High Grade Iron Domain (% Silica) 12 10 oo — »_>—__o— »—_ >—-¢ 9 __¢ — © 0 RoM Tonnes (Mt) a 1 2 3 4 5 6 7 8 Production Year 11 12 70 60 50 40 30 20 Grade (%Fe or %SiO,) 16
Slide 17: PEA Capital Costs
PEA Capital Costs Capital Cost Summary INITIAL CAPEX Initial Sustaining LOM Contingency Equipment Capital Capital Capital 15% 18% Area (C$ (C$ (C$ Owner's millions) millions) millions) Dry Plant Costs: Direct Costs: 7% 13% Equipment 15.5 36.7 52.2 Power Infrastructure: 2% Dry Sizing Plant 6.4 0.6 7.
Slide 18: PEA Operating Costs
PEA Operating Costs Operating Cost Summary LOM OPEX / TONNE SOLD Unit Cost LOM Cost Department (C$/dmt sold) (C$ millions) Site G&A Mining 12.75 290 33% Mining 39% Processing and 3.24 74 power Product haulage 4.79 109 Train loading 1.27 29 Train Loading Site general and 4% 10.79 245 administrative H
Slide 19: PEA Operating Assumptions
PEA Operating Assumptions Base Case Operating Assumptions Production schedule - Mining and processing for 12 months/year at approximately 5,500 tpd - Train loading at approximately 10,000 tpd for 200 days/year (May to November) Power source - Diesel Operator - Mining, crushing, screening, hauling an
Slide 20: PEA Financial Assumptions
PEA Financial Assumptions PEA Base Case Financial Assumptions Benchmark Iron Ore Price (62% Fe Sinter Fines US$90/dmt = 3-year trailing average price CFR China basis) Lump Premium + US$10/dmt = US$100/dmt Houston Product Mix 30% Lump; 70% Sinter for each percentage point of Silica Penalty US$1.50/dm
Slide 21: PEA Economics Summary
PEA Economics Summary • Base Case: benchmark iron ore price US$90/dmt (62% Fe CFR China basis) • Base Case undiscounted cash flow after tax: C$234 m Summary Economics - 100% Basis Discount Item Units Value Rate Pre-tax IRR % 39% Pre-tax NPV at 7% discount 7% C$ million 123.5 Pre-tax NPV at 8% discou
Slide 22: PEA Highlights
PEA Highlights PEA Highlights NPV - NPV8% = C$109 million (after-tax) using US$90/t iron ore price (base case) - NPV8% = C$459 million (after-tax) using US$160/t iron ore price (current price) IRR - IRR = 39% (after-tax) using US$90/t iron ore price (base case) - IRR = 209% (after-tax) using US$160/
Slide 23: PEA Strengths
PEA Strengths • LIM’s Safety Record is Excellent • FY 2012-2020: 1 lost time injury • Very Low Technical and Execution Risks by Industry Standards • 8 km gravel road, 2 km rail siding, dry crushing and screening • Low stripping ratio (waste:ore) • Extensive existing local infrastructure • Short 18 m
Slide 24: PEA Strengths: Extensive Existing Infrastructure
PEA Strengths Extensive Existing Infrastructure Access roads to property Local town with airport Direct to port rail access Hydro power potentially available Hydro Power Connection Ore Shipment to Port LIM Substation Direct to Port Railway Town of Schefferville with airstrip Access Road toLabrador P
Slide 25: Record of Environmental Compliance
Record of Environmental Compliance Redmond Creek Fish Habitat Compensation Facility - 2015 Labrador Iron Mines 25 Redmond Creek Habitat Compensation Facility - 2015
Slide 26: PEA Risks
PEA Risks • Iron Ore Price • Ocean Freight Price • Diesel Fuel Cost • Foreign Exchange • Permitting of Malcolm and Houston 3 – considered low • Cost Escalation – considered low • Construction Execution Risk – considered low • Carbon Tax Risk – considered low impact Labrador Iron Mines 26
Slide 27: PEA Recommended Future Studies
PEA Recommended Future Studies • Exploration Potential Along Strike • Potential to Backfill Open Pits • Houston 3 waste rock (2.9:1 stripping ratio) into Houston 1 open pit • Reduce overall closure obligations and haulage costs • Redmond Rail Loop: • more efficient train loading, potential to increa
Slide 28: Houston Project Summary
Houston Project Summary PEA Completed • Updated Resource Estimate • New Technical Report – March 2021 DSO Resources • High-grade (>62% Fe) Iron Ore Excellent Product Quality • 30% Lump: 70% Sinter Existing Infrastructure James Mine Mining Operations • Town of Schefferville, Airport, Rail to Port Pro
Slide 29: Labrador Iron Mines Contact Us
Labrador Iron Mines Contact Us: John F. Kearney Chairman and CEO +1 (647) 728 - 4101 Richard Pinkerton Chief Financial Officer +1 (647) 728 - 4104 Rodney Cooper President and COO +1 (416) 886-9046 Main Office 55 University Avenue Suite 1805 Toronto, Ontario, Canada M5J 2H7 www.LabradorIronMines.ca J
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