Labrador Iron Mines Holdings Limited - Progress report at shareholders meeting



    TORONTO, Sept. 17 /CNW/ - Labrador Iron Mines Holdings Limited (TSX: LIR)
reports that at the Annual Meeting held in Toronto on September 16th
shareholders were told that good progress has been made during the summer
months on the Company's direct-shipping Schefferville Iron Ore Project in
western Labrador.

    Resource Definition Drilling:

    A program of definition drilling is being undertaken on the four deposits
which comprise the first development phase of the Schefferville project. A
total of 51 reverse circulation holes have been drilled to date. In addition a
program of diamond drilling is being carried out on the outlying Sawyer Lake
Property Where seven holes having been drilled to date.
    The results of the drilling will be utilized in the preparation of
updated compliant resource estimates, which will be incorporated in a new
43-101 technical report expected to be completed by year end. The historical
resources in the Company's eight deposits were previously estimated at 93
million tons, with in-situ grades of 56%-58% Fe, based on previous work
undertaken by the Iron Ore Company of Canada prior to 1983. These historical
resource estimates are not NI 43-101 compliant.

    Test Mining and Bulk Sampling:

    To provide representative samples for metallurgical testing, process
design and product marketing, bulk samples totaling 6,500 tonnes were mined
from each of the James, Redmond, Knob and Houston deposits by contractors RSM
Mining Services Inc. (Labrador City) and Gestion Innu. The samples were
crushed and screened to produce stockpiles of representative lump and sinter
fine ores. It is estimated that approximately 25% of the stockpiles is lump
ore with 75% sinter fine ore. The samples will be transported by rail to the
Port of Sept Iles, where they will be onward shipped to various steel plants
and potential customers, with portion utilized for metallurgical testing.

    Transportation:

    Detailed studies were carried out on the ore transportation plans.
Further technical assessment reports were completed on the railroad.
Negotiations have been carried out with Tshiuetin Rail (TRT) and Quebec North
Shore and Labrador Railroad (QNS&L) and freight rates for 2008 shipments are
under negotiation. Ten gondola railcars, each with 100 tons capacity, have
been leased to transport the bulk samples to port. Stevedoring rates have also
been negotiated with the Logistec Inc. and with the Port of Sept Iles for
storage and shiploading.

    Permitting and Environment:

    The Project Registration Document for the first phase development on the
James and Redmond properties was submitted to the Government of Newfoundland
and Labrador at the end of April, following extensive studies carried out over
the previous three years by the Company's engineering and environmental teams.
The phase one development incorporates the mining plan for the first four
years of mining operations.
    The Ministry of Environment and Conservation completed its review on
August 12th and the Minister directed the preparation of an Environmental
Impact Statement (EIS). An EIS Technical Committee has been established by the
Minister and the draft terms of reference are expected to be finalized by the
end of September. Public consultation will take place immediately thereafter.
It is anticipated that the submission of the Environmental Impact Statement
will be made prior to the end of 2008. Authorization and release of the
project by the Government of Newfoundland and Labrador can be anticipated to
occur during the first quarter of 2009.
    Detailed environmental work is under way for the preparation of the
Environmental Impact Statement and meanwhile the Company's ongoing
environmental baseline program is continuing on schedule.

    Community Consultations:

    In July 2008 an Impact Benefit Agreement was signed with the Innu Nation
of Labrador. The IBA is a life of mine agreement that establishes the
processes and sharing of benefits that will ensure ongoing positive
relationship between the Company and the Innu Nation.
    Consultations and negotiations are also continuing with other First
Nations in the Schefferville and Sept Iles areas. The Company has signed a
Memorandum of Understanding with each of the Innu Nation of Matimekush-Lac
John (Schefferville) and with the Naskapi Nation (Kawawachikamach) reflecting
the agreement of the parties with respect to community support for the
development of the project and the parties commitment to negotiate more
detailed co-operation agreements.

    Plans for Remainder of 2008:

    The ongoing definition drilling program will continue until November. It
is planned to drill up to a total of 10,000 meters in the entire 2008 program.
The iron ore bulk samples will be transported by rail to the Port of Sept Iles
utilizing the Company's ten rail cars and shipped to potential customers for
testing. A Resource and Engineering Study is being undertaken with SNC
Lavalin, supported by Geostat and Lakefield Research and which will
incorporate the updated resources estimates, and is expected to be completed
shortly after year end.

    Outlook:

    Subject to the receipt of permits, Labrador Iron Mines is targeting first
production of its direct shipping iron ore in the second half of 2009. It is
planned to mine 500,000 tonnes of iron ore in 2009, and this will increase to
1.5 million tonnes in 2010 and to 3.0 million tonnes in 2011/12 as production
ramps up. The start-up date is dependent on the timely authorization release
of the project by the Government of Newfoundland and Labrador and the issue of
appropriate permits. The medium to long term outlook for iron ore prices
remains positive, driven in large part by forecasts of strong Chinese steel
demand.

    Strong Cash Position:

    At August 31, 2008 the Company had cash of approximately $45 million,
which is held in short term deposits with Schedule 1 Canadian Chartered Banks.

    About Labrador Iron Mines Holdings Limited:

    Labrador Iron Mines Holdings Limited was established to develop "direct
shipping" iron ore deposits on properties in which it holds interests located
in the Labrador Trough, in the province of Newfoundland and Labrador, near
Schefferville, Quebec. The Company was listed on the TSX in December 2007,
following a successful IPO in which it raised over $52 million.
    The Company's properties in Labrador are part of the historic
Schefferville iron ore district from which over 150 million tons of direct
shipping iron ore was previously mined by the Iron Ore Company of Canada from
1954 to 1982. Subject to timely receipt of permits Labrador Iron Mines is
targeting to commence production and sale of both lump and sinter fine iron
ore in 2009.
    The common shares and warrants of Labrador Iron Mines Holdings Limited
are listed on the Toronto Stock Exchange under the symbols "LIR" and "LIR.WT",
respectively.





For further information:

For further information: Company Contacts: John F. Kearney, Chairman and
CEO, T: (647) 728-4125; Bill Hooley, President and COO, T: (647) 728-4111;
Terence McKillen, Executive Vice President, T: (647)728-4102; Labrador Iron
Mines Limited, 220 Bay Street, Suite 700, Toronto, Ontario, Canada, M5J 2W4,
Tel: (647) 728-4125, Fax: (416) 368-5344, E-mail: info@labradorironmines.ca,
Website: www.labradorironmines.ca

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Labrador Iron Mines Holdings Limited

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