Name of the Project
Kamistiatusset (Kami) iron-ore project.

Location
Western Labrador, Canada.

Project Owner/s
Kami Mine Limited Partnership (Kami LP), a joint venture between Alderon Iron Ore (75%) and HBIS (25%).

Project Description
The updated feasibility study on the Rose deposit of the Kami project, completed in September 2018, has demonstrated the strong economics of the project, which will produce a premium-quality iron-ore concentrate with higher iron content and ultralow impurities relative to the 62%-iron grade benchmark.

The project hosts proven and probable reserves of 517.2-million tonnes grading 28.8% total iron.

The project will produce 7.84-million tonnes a year of 65.2% iron concentrate over a 23-year mine life.

Potential Job Creation
Not stated.

All-in Sustaining Costs/All-in Costs
Not stated.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at an 8% discount rate, of $1.70-billion and an internal rate of return of 24.6%, with a payback of four years.

Project Owner/s
The total estimated capital cost of the project is $982.41-million.

Planned Start /End Date
The project will take 26 months to construct.

Latest Developments
Tunghsu has signed a letter of intent to acquire a 26% to 38% interest in the Kami LP from Alderon Iron Ore for between $15-million and $23-million.

Tunghsu will be the second Chinese partner for the proposed western Labrador iron-ore mine, with HBIS Group already owning a 25% interest in Kami LP.

Alderon has said that it will use a portion of the funds from the Tunghsu investment to repay the $14-million loan facility due to Sprott Resource Lending.

The parties intend to conclude the definitive agreement by March 15, 2020, and close the transaction by April 30, 2020.

Alderon has said that increasing the Chinese content of the Kami LP will better position the Kami project to obtain financing from Chinese banks and institutions. The removal of the loan facility will also remove the associated debt overhang.

The completion of the transaction is subject to several conditions, including the negotiation and execution of the definitive agreement and amended partnership agreements, receipt of regulatory and stock exchange approvals, consent of Sprott and continued agreement from Sprott to extend the loan facility to the date of closing of the transaction.

Key Contracts and Suppliers
Envest (equipment management and acquisition) and Schneider Electric (power infrastructure).

Contact Details for Project Information
Alderon Iron Ore, tel +1 604 681 8030 or email info@alderonironore.com.