Anglesey Mining Regulatory News (AYM)

ANGLESEY MINING PLC - LIM signs new sales and off-take agreements

PR Newswire

London, May 14

Anglesey Mining plc

14 May 2013 LSE:AYM

LIM signs new sales and off-take agreements

Anglesey Mining's associate Labrador Iron Mines Holdings Limited (TSX: LIM) ispleased to report that it has entered into a new iron ore sales agreement withthe Iron Ore Company of Canada ("IOC") for the sale of all of LIM's iron oreproduction for the next two calendar years 2013 and 2014.

At the same time, LIM has announced that it has entered into an off-takefinancing agreement with RB Metalloyd Limited ("RBM"), a leading internationalcommodity trading house, under which LIM will receive an advance payment ofUS$35 million to be credited against future sales of a minimum of 3.5 milliontonnes of iron ore during 2013 and 2014.

LIM commenced its third year of direct shipping iron ore production from itsSchefferville area iron ore mines in Western Labrador in April 2013 and istargeting production of 1.75 to 2.0 million tonnes of sinter fines and lump in2013. The first Capesize shipment of 2013 is expected to be loaded around theend of May.

Two year iron ore sales agreement with IOC

Over the past two years, LIM has sold 13 Capesize shipments of iron ore to IOC,for a total of approximately 2 million tonnes, all of which was resold inChina, with the price calculated based on the daily China spot price, subjectto varying selling discounts, and where the sale of LIM's iron ore experiencedunpredictable variations based on prevailing market conditions.

Under LIM's new sales agreement, IOC will pay for the iron ore progressively,as the ore is resold, with the price calculation based on the monthly averageof the market index, which should decrease LIM's exposure to market volatilityexperienced in the past two years. IOC payments will be later reconciled basedon IOC's net actual aggregate resale price, adjusted for any product qualityspecification premiums or penalties, after ocean freight and IOC's priceparticipation.

"We are very pleased to be able to continue our working relationship with IOCas we head into our third year of production from our Schefferville area ironore mines" said John Kearney, LIM's Chairman and Chief Executive Officer. "Inaddition, extending the contract for the next two years and fixing the price tobe calculated based on the monthly average of the market index are twoimportant improvements over previous years."

US$35 million off-take financing

Under the terms of the financing agreement with RB Metalloyd, RBM has advanceda pre-payment of US$35 million to LIM, which will repaid over a period of twoyears, credited against the proceeds of LIM's sales of iron ore shipmentsbetween July 2013 and December 2014.

RBM has entered into an iron ore off-take agreement with IOC under which RBMhas agreed to buy the LIM iron ore from IOC on an FOB Sept-Îles basis.

"This advance payment financing of $35 million from RBM provides LIM withimportant working capital and increased liquidity and will enable us to ramp upour 2013 production of iron ore and complete our planned capital investment andimprovements on our Silver Yards processing plants", added John Kearney.

"We look forward to working with RB Metalloyd, who bring LIM experience andexpertise in the marketing and sale of iron ore as well as extensive knowledgeof the iron ore and steel markets worldwide."

Iron Ore Company of Canada (IOC)

IOC is Canada's largest iron ore producer from its mines located in WesternLabrador and is a leading global supplier of iron ore pellets and concentrates.IOC owns 100% of the Quebec North Shore and Labrador ("QNS&L") railway and, atthe port of Sept-Îles, owns established storage and ore handling facilities,including its ship dock capable of taking ocean going vessels up to 240,000(dwt) tonnes.

In 2011, LIM entered into a life of mine, rail transportation contract with QNS&L for the rail transportation of LIM's products on the QNS&L railway. Thiscontract provides for a confidential tariff, with capacity and volumecommitments on the part of each party.

RB Metalloyd (RBM)

RBM is a leading international commodity trading house with specific expertisewithin the steel making raw materials sectors. RBM is a subsidiary of RBResources, an investment company for all natural resources investments held bythe Reuben Brothers Group, one of the world's largest privately held investmentcompanies.

About Labrador Iron Mines Holdings Limited (LIM)

Labrador Iron Mines (LIM) is Canada's newest iron ore producer with a portfolioof direct shipping (DSO) iron ore operations and projects located in theprolific Labrador Trough. Initial production commenced at the James Mine inJune 2011. LIM has commenced its third year of operations and is targeting 1.75to 2.0 million tonnes of saleable iron ore production in 2013.

About Anglesey Mining plc

Anglesey currently holds 19,289,100 shares in LIM which comprise 15.3% of LIM'soutstanding share capital. Toronto-listed Labrador Iron Mines Holdings Limitedis producing high grade hematite from its James pit, one of LIM's directshipping iron ore deposits in western Labrador and north-eastern Quebec.

Anglesey is also carrying out exploration and development work at its 100%owned Parys Mountain zinc-copper-lead deposit in North Wales, UK where a JORCCode-compliant resource of 2.1mt at 6.9% combined base metals in the indicatedcategory and 4.1mt at 5.0% combined in the inferred category was published inNovember 2012.

For further information, please contact:

Bill Hooley, Chief Executive +44 (0)1492 541981;

Ian Cuthbertson, Finance Director +44 (0)1248 361333;

Samantha Harrison: RFC Ambrian +44 (0)20 3440 6800;

Emily Fenton / Jos Simson: Tavistock Communications +44 (0)20 7920 3155