The iron formation on the property is iron formation of the Lake Superior type. Lake Superior-type iron formations consist of banded sedimentary rock composed principally of bands of iron oxides, magnetite and hematite within quartz (chert)-rich rock with variable amounts of silicate, carbonate and sulphide lithofacies.

Mineralization of economic interest on the property is oxide facies iron formation. The oxide iron formation ("OIF") consists mainly of semi-massive bands or layers, and disseminations of magnetite and/or specular hematite (specularite) in recrystallized chert and interlayered with bands (beds) of chert with iron carbonates and iron silicates. Where magnetite or hematite represent minor component of the rock comprised mainly of chert, the rock is lean iron formation. Where silicate or carbonate becomes more prevalent than magnetite and/or hematite, then the rock is silicate iron formation ("SIF") and or silicate-carbonate iron formation and its variants. SIF consists mainly of amphibole and chert, often associated with carbonate and contains magnetite or specularite in minor amounts. The dominant amphibole on the Kami property is grunerite. Where carbonate becomes more prevalent, the rock is named silicatecarbonate or carbonate-silicate iron formation. However, in practice, infinite variations exist between the OIF and silicate-carbonate iron formation composition end members. SIF and its variants and lean iron formation are also often interbedded with OIF.

The OIF on the property is mostly magnetite-rich and some sub-members contain increased amounts of hematite (specularite). Hematite appears to be more prominent in Rose North mineralization than at either Rose Central or Mills Lake, but all zones contain mixtures of magnetite and hematite. At both Rose North and Rose Central and at Mills Lake, a bright pink rhodonite, which is a manganese silicate, is associated with hematite-rich OIF facies. Deeply weathered iron formation in the Rose North deposit also contains concentrations of secondary manganese oxides. There may also be other manganese species present.

The mining methods are based on conventional drilling and blasting, followed by loading and hauling. The selection of the major fleet is based on operating time assumptions, mechanical availability and utilization, haulage distance and cycle time assumptions, and truck speed and consumption profiles. The primary fleet consists of using hydraulic (electric) shovels, diesel haul trucks, electric rotary blast hole drill rigs and wheel loaders. Support equipment includes rubbertire dozers, track type dozers, motor graders, etc.

Material from the mine is delivered by haul truck to a dump pocket directly feeding one 1,525 mm x 2,260 mm (60” x 89”), 750 kW gyratory crusher. Crusher power was determined based on a design crusher work index of 12.8 kWh/t, F80 of 800 mm and P80 of 150 mm. During periods when the crusher is not available, stockpiling ahead of the crusher can be done within a designated area. Specific throughput is based on crusher utilization of 75%, and nominal and design capacities are 3,501 t/h and 4,026 t/h (dry) respectively. ROM material moisture is assumed to be 1.5% and density is 3.4 t/m3.

The overland conveyor discharges onto an outside stockpile of 38,000 t live capacity. This live capacity is sufficient to sustain about 12 hours of processing plant operation, allowing the crusher to be taken out of service for normal maintenance while maintaining feed to the mill. The total pile capacity is in the order of 290,000 t (about 4 days), sufficient to maintain an uninterrupted feed to the grinding circuit while permitting major repairs to be undertaken on the crusher.

Crushed material at a nominal rate of 2,886 t/h is fed to a single 10.97 m dia. x 7.01 m long (36’ x 23’) flange to flange (6.48 m EGL), 2 x 7,500 kW dual-pinion AG mill. Recycled process water is added in the feed box to control the slurry at 65% solids. The material is ground to a particle size P80 of 300 microns, which is the size required to achieve sufficient liberation for effective gravity concentration. The AG mill can accept a ball charge of up to 5%, thus providing an opportunity to increase throughput and to deal with periods of hard ore as necessary.

The slurry from the AG Mill is discharged into a splitting chute distributing the slurry to two horizontal single deck scalping screens of 4.27 m x 8.56 m (14’ x 28’) with a screen mesh opening of 4.0 mm. The oversize fraction from the scalping screens is returned to the AG mill by belt conveyor.

The gravity concentrating circuit layout is based on a conventional three-stage spiral circuit. There are two primary distributors, each feeding 12 banks of roughers (24 in total). Each rougher spiral bank has a distributor that feeds 16 double-start spirals arranged in a back to back configuration of eight spirals. There are a total of 384 double-start spirals.

The rougher spirals produce a concentrate stream and a tailings stream. The concentrate is collected in a network of launders and directed to the cleaner spiral distributors. The tailings are directed to the Magnetic Separation Circuit. The rougher spirals have wash water added to promote a better selectivity and separation efficiency of the iron rich particles from the lighter silica rich particles. Dilution water is added to the rougher concentrate to allow for better cleaner spiral performance.

The cleaner spirals produce three products: concentrate, coarse middling, and fine middling. The concentrate is fed directly to the recleaner spirals. The coarse middling stream is recirculated to the rougher spiral feed pump box. The fine middling stream is directed to the fine middling cyclone feed pump box for dewatering. Dilution water, as well as wash water, is added to the cleaner spirals.

The recleaner spirals also generate three products: concentrate, coarse middling, and fine middling. The concentrate flows to the pan filters and constitutes the final gravity circuit concentrate. The coarse middling stream is recirculated to the rougher spiral feed pump box. The fine middling stream is directed to the fine middling cyclone feed pump box. Wash water is added to the recleaner spirals.

The gravity circuit concentrate produced by the recleaner spirals is directed by gravity to four horizontal pan filters having a 7.93 m (26’) diameter. The filtered concentrate is conveyed to the concentrate load-out while the filtrate is directed to the fine middling cyclone pump box. Each pan filter is provided with a scroll discharge and a steam hood for steam injection during the winter months. Moisture levels for filtered gravity concentrate are expected to be in the order of 3.5% in the summer and 2.5% in the winter. This practice is aimed at reducing the risk of concentrate freezing in the railcars during transport to the port terminal facility.

The rougher spiral tailings are pumped to the magnetic separation circuit (mag plant) cobbing low intensity magnetic separators (“LIMS”). There is a total of twelve 1.2 m x 3.6 m LIMS units configured in two banks of six, each fed by its own distributor. The concentrate from the cobbing drums consists mainly of non-liberated magnetite, requiring regrinding, and fine liberated magnetite that was not recovered in the spirals. This concentrate is directed to the classification cyclone. The cobber LIMS tailings are directed to the tailings boil box.

The classification cyclone system consists of one cluster having six, 650 mm diameter cyclones (and two blanks for future requirements). The cyclone underflow is sent to the regrind ball mill 6.7 m x 12.3 m (22’ x 40.5’), while the overflow is directed to the finisher LIMS. The mass balance, as developed during detailed engineering, is based on a 150% recirculating load to the ball mill.

The finisher LIMS concentrate is sent by gravity to five fines screens (5-deck stack sizers), having a screen opening of 75 µm, where wash water can be added to assist the operation. The fine screen oversize is sent back to the regrind mill as it consists mainly of coarse, unliberated particles. The undersize, a high magnetite grade but dilute stream, is directed to the dewatering LIMS.

Two, 1.2 m x 3.6 m, dewatering LIMS units are used to increase the %-solids of the slurry and further remove entrained tails prior to filtration. The dewatering LIMS concentrate is pumped to the drum filters while their tailings are directed to the classification cyclone pump box.

Each of the four drum filters (3.93 m dia x 6.55 m length) is provided with a steam hood for steam injection year round. Moisture level for this finer concentrate is expected to be in the order of 7%. The filtered concentrate is discharged onto a conveyor system where it joins the gravity concentrate for conveying to the concentrate load- out. Filtrate is directed to the classification cyclone pump box.