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 th ........