Labrador Iron Mines

Holdings Limited

TSX: LIM

Our Commitment

Permitting

LIM's Project is located in a remote area of western Labrador adjacent to the boundary with the Province of Quebec. The mine operations involve the extraction of iron ore in an area of previous iron ore mining and are carried out using conventional open pit mining methods. Ore is beneficiated by crushing, washing and screening and no chemicals are used in the beneficiation process.

The Company is required to obtain various permits to carry on its activities and is subject to various reclamation and environmental conditions. In addition to all the necessary permits to complete the exploration work, resource definition work and the engineering study, the Company has received all major permits required to construct and operate the James and Redmond mines as well as the beneficiation facilities at the Silver Yards from both the Government of Canada and the Government of the Province of Newfoundland and Labrador.

To date, Labrador Iron mines Limited has received regulatory approvals for over 55 mine construction and operational permits including the receipt of all required Mining and Surface Leases issued under the Mining Act (Newfoundland and Labrador), and the approval and release of the project under the Environmental Protection Act (Newfoundland and Labrador) and the Environmental Assessment Act (Canada). Legislation principally applicable to the permitting process by the Government of Canada includes (i)the Environmental Assessment Act, the Environmental Protection Act and the Species at Risk Act all administered by Environment Canada; (ii) the Fisheries Act administered by Fisheries and Oceans Canada; and (iii) the Navigable Waters Protection Act and the Transportation of Dangerous Goods Act administered by Transport Canada.

Legislation principally applicable to the permitting process by the Government of Newfoundland and Labrador includes (i) the Environmental Protection Act, the Water Resources Act and the Endangered Species Act administered by the Department of Environment and Conservation; (ii) the Mining Act administered by the Department of Natural Resources; and (iii) the Occupational Health & Safety Act and the Workplace Health, Safety and Compensation Act administered by the Department of Government Services.

Throughout the environmental studies permitting process, starting in 2005, LIM has been consulting with the Elders of the various nearby aboriginal communities, collecting traditional knowledge and sharing information about the proposed mine construction and operation as well as the results of environmental baseline programs conducted in the area. The information that the Elders have shared with Labrador Iron Mines Limited was included in the Environmental Impact Study, developed as part of the Environmental Assessment program, documenting the existing environment and incorporated into the mine design. These programs were expanded in 2008 to meet the scope of the proposed development and included detailed assessments of the aquatic and terrestrial ecology, hydrology and groundwater, geochemistry and socio-economic components. Ongoing meetings with the Elders will be conducted as part of the environmental monitoring program for the mine construction and operations.

Project Registration Application

In April, 2008, the Company submitted the Project Registration Application for the first phase of development of the Project, being the James North, James South and Redmond properties, to the Department of Environment and Conservation in the Province of Newfoundland and Labrador and to the Canadian Environmental Assessment Agency (CEAA). These properties have been the subject of prior activity carried out by the Iron Ore Company of Canada and are already partially developed. Filing of the Project Registration application followed extensive studies carried out over the prior three years by LIM's community consultation, engineering and environmental teams. The Registration Document was posted on the Department of Environment and Conservation's website at www.gov.nl.ca.

Environmental Impact Statement (EIS)

In August 2008 the Minister of Environment and Conservation requested an Environmental Impact Statement (EIS) as part of the Application process. In October 2008 the Minister published for public consultation the draft guidelines for the preparation of the EIS. Following this period of public consultation, during which LIM conducted three public meetings in Labrador and in Schefferville, the Final Guidelines were issued by the Minister on December 12, 2008. LIM, in conjunction with its consultants, carried out an extensive program to prepare the EIS based initially on the draft guidelines and using the extensive environmental data and studies that had been collected and undertaken by LIM since 2005. The EIS was submitted to the Minister on December 22, 2008 and was registered on December 23, 2008, and resubmitted with the addition of supplemental information on August 19, 2009.

The Canadian Environmental Assessment Agency (CEAA) completed its review of the Project and has determined that a federal level Canadian Environmental Assessment was not required in February 2008. This decision was made following the recent receipt of a determination by the Department of Fisheries and Oceans, that a Harmful Alteration, Disruption, or Destruction authorization will not be required for the Project. Other federal agencies, including Environment Canada, Transport Canada, Natural Resources Canada, Health Canada and the Canadian Transportation Agency, also completed their reviews and confirmed that they had no triggers for a federal level environmental assessment. In addition, the Major Projects Management Office has declared that the Project does not constitute a major natural resources project.

EIS Review Completed

In February 18, 2009, LIM was advised by CEAA that no federal assessment would be required. On November 5, 2009, the Newfoundland and Labrador Minister of Environment and Conservation announced that the Schefferville Area iron Ore Project Environmental Impact Statement complies with the Environmental Protection Act and requires so further work under the Provincial environmental assessment process. The Minister advised the Company that she would make a recommendation for consideration by the Government of Newfoundland and Labrador on release of the Project from further environmental assessment. On February 12, 2010, the Newfoundland and Labrador Minister of Environment and Conservation informed LIM that, under the authority of Section 67(3)(a) of the Environmental Protection Act, the Lieutenant-Governor in Council released the Project for further environmental assessment.

Approvals for Construction and Operation of Mining and Associated Facilities

On March 24, 2010, the Newfoundland and Labrador Department of Natural Resources announced that it had approved the Development Plan and accepted the Rehabilitation & Closure Plan for the construction of the rail spur line, pursuant to the Mining Act.

On April 23, 2010, The Newfoundland nd Labrador Department of Environment and Conservation advised LIM that it had accepted the Environmental Protection Plan for the spur line re-establishment. On June 29, 2010, the Department of Environment and Conservation further confirmed that it had accepted the Environmental Protection Plan for the overall mine construction and operation activities.

On July 28, 2010, LIM received Certificates of Approval for the construction of its mining facilities from the Government of Newfoundland and Labrador. The approvals provide for the construction of open pit mining and treatment facilities at the James North, James South, Redmond 2B and Redmond 5 deposits, and include the beneficiation facility, ore, waste rock and overburden stockpiles, settling ponds, access roads, accommodation camp and other associated works for LIM’s Schefferville Area direct shipping iron ore project. The approvals also include authorization for the installation and operation of power generators at the James deposit, the Silver Yard beneficiation area and the accommodation camp.