Northland Resources S.A.

Northland Resources S.A.

December 19, 2012 06:00 ET

Rail Line From Kaunisvaara to Svappavaara Is an Important Part of the Region's Long-Term Transport Solutions

LUXEMBOURG, LUXEMBOURG--(Marketwire - Dec. 19, 2012) - Northland Resources S.A. (TSX:NAU)(OSLO:NAUR)(FRANKFURT:NPK)(OMX:NAURo) ("Northland" or the "Company") welcomes the decision by the Swedish parliament (Riksdagen) to initiate a study with the objective of constructing a rail line between Kaunisvaara and Svappavaara in northern Sweden. A rail line means cost-efficient transports for business and industry in a growing part of the Nordic region whilst also providing benefits from the perspectives of safety and the environment.

The Swedish Parliament resolved yesterday to examine without delay a possible rail line between Kaunisvaara and Svappavaara. A unanimous Parliamentary Standing Committee on Transport and Communications backed the proposal, which also entails that the Swedish government, in its planning of measures, shall prioritize investments to promote the mining industry's transport needs, such as the ongoing upgrade of the road between Pajala and Svappavaara.

The Parliament's resolution confirmed the government's commitment to invest in the build-out of mining-related infrastructure, primarily in the province of Norrbotten. The government has previously allocated about SEK 2.1 billion to strengthen the roads between Pajala and Svappavaara, as well as the high capacity railway Malmbanan (The Ore Railway) to Narvik.

Today, Northland transports its high-quality iron ore concentrate by truck on the 150 km stretch between the mine area in Kaunisvaara and the reloading terminal in Pitkäjärvi, close to Svappavaara.

"A rail line would strengthen our possibilities to transport our iron ore concentrate at a more competitive cost level," said Northland's President and CEO Karl-Axel Waplan. "For producers of iron ore, logistics represent a major part of the production costs and a rail line combines important environmental, traffic safety and cost aspects. The planned rail line between our mine in Kaunisvaara and Svappavaara is a solution that will strengthen Northland's opportunities to conduct long-term mining operations in Sweden, while other areas of business and industry in the region also would gain from a robust transport route that provides opportunities to access major export markets."

Karl-Axel Waplan, President and CEO, Northland Resources S.A.

Northland is a producer of iron ore concentrate, with a portfolio of production, development and exploration mines and projects in northern Sweden and Finland. The first construction phase of the Kaunisvaara Project is complete and production ramp-up started in December 2012. The Company will produce high-grade, high-quality magnetite iron concentrate in Kaunisvaara, Sweden, where the Company will exploit two magnetite iron ore deposits, Tapuli and Sahavaara. Northland has entered into off-take contracts with three partners for the entire production from the Kaunisvaara Project over the next seven to ten years. The Company is also preparing a Definitive Feasibility Study ("DFS") for its Hannukainen project in Kolari, northern Finland. Hannukainen is an iron oxide copper gold (IOCG) deposit, meaning that gold and copper can also be extracted in addition to iron ore. The Company is also preparing a DFS for the Pellivuoma deposit, which is located 15 km from the Kaunisvaara processing plant.

Contact Information

  • Northland Resources S.A.
    Karl-Axel Waplan
    President and CEO
    +46 (0)705 104 239

    Northland Resources S.A.
    Peder Zetterberg
    acting CFO
    +46 (0)708 652 120

    Northland Resources S.A.
    Anders Antonsson
    Vice President - Investor Relations
    +46 (0)709 994 970