The Lake Superior-type iron formation consists of banded sedimentary rocks composed principally of bands of iron oxides, magnetite and hematite within quartz (chert)-rich rock, with variable amounts of silicate, carbonate and sulphide lithofacies. Such iron formations have been the principal sources of iron throughout the world.

The Sokoman iron formation was formed as chemical sediment under varied conditions of oxidation-reduction potential (Eh) and hydrogen ion concentrations (pH) in varied depth of seawater. The resulting irregularly bedded, jasper-bearing, granular, oolite and locally conglomeratic sediments are typical of the predominant oxide facies of the Superior-type iron formations, and the Labrador Trough is the largest example of this type.

The Houston project area is composed of what appear to be at least three separate areas of iron enrichment with a continuously mineralized zone of over 3 km in strike length and which remains open to the south. These three areas of enrichment are referred to as the Houston 1, Houston 2 and Houston 3 deposits. Houston 3 is currently less well explored and there appears to be significant additional DSO potential to the south of Houston 3 which requires additional drilling.

The Houston and Malcolm 1 DSO iron deposits are stratigraphically and structurally controlled, and consist of hard and friable banded, blue and red hematite that locally becomes massive. Airborne magnetometer survey data available from the Geoscience Data Repository of Natural Resources Canada suggests that the iron ore is concentrated along the western flank (gradient) of a modest to strong magnetic feature, which trends approximately 330°. The Houston 1 and Houston 2S deposits are not coincident with the strongest magnetic features, due to the poor magnetic susceptibility of this type of mineralization.

LIM carried out drilling during the 2006 and 2008 to 2012 programs in Houston which indicated that the majority of the potentially economic iron mineralization occurs within the lower iron formation (LIF) and middle iron formation (MIF). The majority of the economic mineralization in the Houston area is hosted within the Ruth Chert Formation.

Striking northwest and dipping to the northeast, both Houston 1 & 2 mineralizations have been found to extend down dip to the northeast. These down dip extensions had not been previously tested by IOC when mining operations in the area ended. At the present time there remains potential for additional mineralization believed to be extending to the southeast of the main deposit of Houston 1 and east of Houston 3.

The Houston 3 deposit appears to be more vertical in nature and drill holes testing the eastern margin of the known deposit have not intercepted any eastward extensions. However, this deposit has yet to be tested to its maximum vertical depth or for at least an additional 2 km of strike to the south.

The manganese deposits in the Schefferville area were formed by residual and second stage (supergene) enrichment that affected the Sokoman (iron) Formation, some members of which contain up to 1% Mn in their unaltered state. The residual enrichment process involved the migration of meteoric fluids circulated through the proto-ore sequence oxidizing the iron formation, recrystallizing iron minerals to hematite, and leaching silica and carbonate. The result is a residually enriched iron formation that may contain up to 10% Mn. The second phase of this process, where it has occurred, is a true enrichment process (rather than a residual enrichment), whereby iron oxides (goethite, limonite), hematite and manganese are redistributed laterally or stratigraphically downward into the secondary porosity created by the removal of material during the primary enrichment phase. Deposition along faults, fractures and cleavage surfaces, and in veins and veinlets is also seen, and corroborates the accepted belief that the structural breaks act as channel-ways for migrating hydrothermal fluids causing metasomatic alteration and formation of manganiferous deposits. All the manganese occurrences in the Labrador Trough are considered to have been deposited by the processes described above.

The manganese mineralization in the Houston deposits is present in relatively low concentrations (~1% average) with sporadic concentrations of up to 24% apparently structurally controlled by folding and faulting along the western block of the east dipping reverse fault system.

All mining operations will be by conventional open pit mining methods.

Mining will be conducted year-round and beneficiation will be conducted seasonally, from approximately April to November each year.

Mining will be conducted in a sequential manner using conventional open pit mining methods. Mechanical methods will be used, where possible, to break up the rock but this may also require the use of explosives. No new explosives storage facilities are planned for the Houston project. It is currently planned that the existing explosives storage at the James Mine area will be used to source any blasting materials. Some blasting will be required even though some of the ore and waste is free digging.

The Houston-Malcolm 1 Open Pit Mines will have overall pit wall angles ranging from 34 degrees in overburden to 45 degrees in competent rock. The face angles range from 40 degrees in overburden to 60 degrees in competent rock. These angles are based on dewatered/depressurized pit walls and controlled blasting techniques. The excavations will be mined in 10 meter benches with double benching before establishing 8 meters wide berm. LIM’s experience at the operating James pit indicates that the pit slope and bench height assumptions are practical.

The waste will be hauled to the specific waste dump sites. The waste rock dumps and overburden stockpiles are designed for Houston 1 & 2 project are located immediately to the east of the pit.

The results of the metallurgical tests done on Houston bulk trench samples have indicated the amenability of the deposit to be processed using conventional iron ore processing methods. The +1mm size fraction of HU1, HU2 and DRO is generally of marketable grade hence the objective of the concentration process for Houston deposit will be mainly to upgrade the -1mm portion using either wet high intensity magnetic separation (WHIMS) or a hydrosizer. The settling test results on the -1mm products of the trench samples generally have shown good settling rates even without flocculent addition therefore implying the use of conventional thickener. The vacuum filtration of the -300micron is one of the areas that need to be investigated further though initial tests have produced 15-16% cake moisture. DRA recommends exploring other filtration technologies such as plate filters.

The proposed Houston Beneficiation Plant will be constructed 2-3 years following the initial development of the Houston 1 and 2 Deposits and will process ore from those deposits initially and potentially from the Malcolm and Houston 3 deposits at a later date. LIM anticipates that some ore from the Houston Project may be beneficiated at the Silver Yard facility at James Mine pending the construction of the proposed Houston plant. As with LIM’s existing Silver Yard facility, the proposed Houston Beneficiation process will involve the crushing, screening, washing and magnetic separation of the rock. No chemicals will be added as water is the only constituent used in the beneficiation process. The resulting wash water consists of water and fine rock material (reject fines). As at LIM’s nearby existing James Mine project, the final products to be produced from the Houston 1 and 2 deposits will include lump and sinter fine ores for direct shipping to end users in Europe and/or Asia. The throughput of the proposed Houston plant is designed for 600 tonnes per hour with an average daily production of 12,000 tonnes during peak operation.

The plant feed area includes the ramp for the haul truck, static grizzly, inload bin, grizzly feeder, primary (jaw) crusher, sacrificial conveyor and plant feed conveyor.

Run-of-mine ore will be dumped directly by trucks into the 250 tonne in-load bin fitted with static grizzly set at 300 mm bar spacing for feed top size control. A vibrating grizzly feeder set at 75 mm will draw ore from the in load bin. The grizzly feeder oversize will be fed to the jaw crusher set at 75 mm to produce a 125 mm lump size. The product of the primary crushing station will be transported by a series of conveyors to the primary screen. A metal detector will be installed on the plant feed conveyor to prevent tramp iron from damaging subsequent equipment, particularly the secondary crusher. The under-crusher conveyor will be fitted with a programmable hammer sampler for automatic sampling.

This area includes the primary screen, scrubber, secondary crusher, secondary screen and several conveyors. The plant has been designed as a single line process, thus eliminating several machines, conveyors an a lessening the footprint of the plant.

Primary screening will be carried out by a horizontal vibrating screen with aperture size of 32 mm which will be operated in closed circuit with the secondary crushing circuit. The screen oversize with particle sizes +26 mm will be conveyed to a 40 t secondary surge bin while the undersize -32 mm particle size, will gravitate to the ore scrubber. A pan feeder will reclaim material from the surge bin feeding it to the cone crusher which will be fitted with a coarse profile cavity set at 45 mm producing 70 mm lump size material. The secondary crusher product will be transported back to primary screening.

The discharge of the ore scrubber will gravity flow to a double deck secondary multi-sloped vibrating screen equipped with water sprays. The top and bottom deck of the secondary screen will be fitted with 6 mm and 1 mm opening panels, respectively. Materials retained on the top deck (-32 mm, +6 mm) and on the bottom deck (-6 mm, +1 mm) will be transported to the lump ore and sinter fines stockpile, respectively, via transfer conveyors and stackers. Materials passing the bottom deck (-1 mm) will be pumped to the cyclone cluster.

Hammer samplers will be installed on the transfer conveyors of lump ore and sinter fines for product quality control and accounting.

This area consists of the cyclone cluster, primary and secondary WHIMS, dewatering screen, thickener, disc filter and a conveyor.

Seven out of the nine 10” hydro-cyclones will be operated at any one time to de-slime the secondary screen undersize removing particles finer than 15 microns. The overflow of the cyclone, where majority of the fine particles will be reporting is then pumped to the rejects tank while the underflow will be fed to the primary Wet High Intensity Magnetic Separator (WHIMS).

The non-magnetic materials from the primary WHIMS will be reprocessed in the secondary WHIMS to maximize recovery. The combined magnetic products of primary and secondary WHIMS will be pumped to the 5-deck Derrick Screen Stacksizer fitted with 300 micron aperture panels.

The Derrick screen oversize (-1 mm, +0.3 mm) at 12% moisture will be conveyed to the fines stockpile while the undersize (-0.3 mm, +0.015 mm) will be pumped to the thickener. Thickener underflow at 75% solid concentration will be pumped to a vacuum disk filter as final dewatering step. The filter cake, with moisture content of 15%, will be conveyed to the ultra fines stockpile.

At regular frequency, the cloth of the disk filter will be washed to reduce blinding, thus restoring filtration efficiency. The cloth wash water will be pumped back to the thickener feed well for pulp dilution.

Three process streams will handle the plant rejects which include the cyclone cluster overflow, secondary WHIMS non-magnetic materials and thickener overflow.