Labrador Iron Mines

Holdings Limited

TSX: LIM

Schefferville Area Properties

Mining

Processing Description and Flowsheet

The processing plant at Silver Yards is being installed in three phases. Phase I consists of primary and secondary crushing; washing by means of tumbling scrubbers; and sizing. The construction of this phase was completed in May 2011. The plant was commissioned in early June 2011 with no major issues during commissioning process and is now ramped up to its design capacity.

Phase II consists of a fines recovery area including de-sliming cyclones, FLOATEX Density Separator, and horizontal pan filter to further process the (-600 mm) fines and produce sinter fines product. Construction and commissioning were completed in October 2011 and the plant is now in full operation.

Phase III includes installation of additional equipment to produce a fourth product, ultra fines (pellet feed), and an extension line to increase the plant production capacity.

PRIMARY CRUSHING AREA

The ROM ore from the pits is delivered via off-highway end dump trucks to the Primary Mobile Crushing Plant and either directly dumped into the feed hopper or stockpiled nearby for subsequent reclaiming into the feed hopper by a Front End Loader or a loader and truck.

The primary mobile crushing plant includes a hopper, vibrating grizzly feeder, jaw crusher, various chutes, bins, and conveyors, and lubricating system.

The ROM feed has a top size of 600 mm. Approximately 50% of the feed bypasses the primary crushing stage as it is already minus 100 mm.

TUMBLING SCRUBBERS AREA

The discharge from the primary crushing is conveyed via splitter to two lines starting with a tumbling scrubbers circuit. The purpose of this step is to beneficiate the ore by incorporating water to wash the clay materials from the ore materials. The scrubbers are sized at 2,100 mm x 5,000 mm each and have motors with 90kW (each) power installed.

PRIMARY SCREENING AREA

The discharge from the tumbling scrubbers circuit proceeds to the primary screening circuit. This is the first stage of classification. The primary screening units are double deck screens and are sized at 1,840 mm x 4,870 mm, and 25 mm and 1mm decks openings.

The oversize material (+25 mm) on the top deck is sent to the secondary crushing circuit, the undersize material (-1 mm) from the bottom deck is sent to the secondary screening circuit, and the remaining material (+1 mm, -25 mm) is conveyed to the Lump Ore screening area.

LUMP ORE SCREENING AREA

The oversize of the second deck from the primary screens (+1 mm, -25 mm) is fed to a single Lump Ore Screen with the same size as the primary screens 1,840 mm x 4,870 mm. The lump ore screen deck has an opening of 8mm and the oversize material (+8 mm, -25 mm) is stockpiled via stacking conveyor as a final lump product and the screen undersize (+1 mm, -8 mm) along with the oversize of the secondary screens is transported via a stacking conveyor to a stockpile as a final coarse sinter feed product.

SECONDARY CRUSHING AREA

The oversize (+25 mm) from the primary screening circuit is transferred to the secondary crushing circuit. The secondary crusher is a standard cone crusher, 4.1/4 Symons. The product from the cone crusher is re-circulated back to the primary screening circuit.

SECONDARY SCREENING AREA

The undersize (-1 mm) from the primary screening circuit is pumped to the secondary screening circuit. It consists of two four deck Derrick screens type 2SG48-60R with an opening of 600 �m.

The oversize material +600 �m from the secondary screen is conveyed to the sinter fines stockpile. The undersize from the secondary screen is pumped to the fines recovery area.

FINES RECOVERY AREA

The undersize material (+150 �m, -600 �m) from the secondary screen is pumped to de-sliming cyclones with the cyclone underflow feeding a twin 7� x 7� FLOATEX� density separator model LPF-2140 T HM. The undersize material (-150 �m) from the FLOATEX� separator is dewatered in a 4,000 mm dia., 10m2 filtering area FLSmidth Dorr-Oliver Heavy Duty Horizontal Pan Filter type HPF to a moisture of below 8% and then stockpiled as a sinter fines product. The water from the filter is pumped to the reject rock disposal area.

REJECTS DISPOSAL AREA

The existing flooded Ruth Pit, located north of the Silver Yards Plant is used as a final plant rejects disposal. The rejects are pumped via 2.9 km long 300 mm diameter pipe and discharged to the pit. The cyclones and the density separator overflows are combined and pumped as a slurry to the reject rock fines disposal area. The design for the reject fines disposal includes the following:

 The reject fines slurry is pumped approximately 2.9 km via an above ground, 300 mm diameter HDPE pipeline to the Ruth Pit. The Ruth Pit is an exhausted mine that is now flooded. The surface area of the Pit is 61.5 ha and the depth of the pit is 120 m.

 An emergency disposal/storage area within the Silver Yards area is also designed to provide room in the case the reject fines pipeline or beneficiation process equipment needs to be purged. Its location is coincident with the Silver Yard settling pond.

PLANT EXPANSION PHASE III - 2012

LIM is planning to install in 2012, additional process equipment to process the (-150 �m) products to produce a high grade saleable product. This equipment include installation of a wet high intensity magnetic separator (WHIMS) to further process the (-150 �m, +15�m) overflows of the FLOATEX� separator and the secondary de-sliming cyclone to produce another product � ultra fines (pellet feed). In order to increase the plant capacity to 12,000 t/d, LIM will also install a third parallel processing line including the same sizes as the first two lines scrubber, primary and secondary screens, and a FLOATEX� Density Separator.

LABORATORY

An on-site mobile laboratory in a portable modular building is established at the Silver Yard area. The laboratory includes a sample preparation section with a drier, crushers, screens, pulverisers and rifle splitters and an analytical lab section for daily ore control and exploration samples analysis. The analytical methods used will be fusion (lithium metaborate) followed by XRF spectrometry.

RAIL LOADOUT AREA

The material from the Sinter Fines stockpiles and the Lump Ore stockpile is reclaimed with front end loaders and delivered to rail cars.

PLANT PRODUCTION RATES

The current plant production capacity is designed for a 400t/h and a base case of 212d/y of operation. Overall the equipment, as designed, is capable to handle 10-15% more feed, and dependant on the weather conditions the plant would be able to operate 230-240 days per year and process up to 10,500t/d. With the installation of the equipment for phase III the overall plant feed capacity will be increased to 600t/h and the recovery will be increased to approximately 85% .