Northland’s Kaunisvaara Project On Time for Production in 2012 and Within Budget

Luxembourg - Northland Resources S.A. (TSX: NAU, OSE: NAUR, Frankfurt: NPK -- “Northland” or “the Company”) is pleased to announce three major achievements that will ensure the Kaunisvaara project to advance according to the plan to start mining operation in the fourth quarter of 2012 and to start production of high-grade, high-quality magnetite iron concentrate in the first quarter of 2013.

To link the Kaunisvaara process plant to the Swedish regional power grid, Northland has signed an agreement with Vattenfall, the Swedish energy company, to construct the main power supply line. Vattenfall has initiated work to build an overhead power line between the village of Tärendö and the process plant in Kaunisvaara, a distance of 60 km. The line will have a capacity of 130 kV and power is anticipated to be delivered as of October 1, 2012, in advance of the planned start of ramp up of the process plant

At the project site in Kaunisvaara, the peat covering the Tapuli mine ore body was dewatered during the first half of 2011. Northland has commissioned the contractor Peab to remove an overburden consisting of peat, moraine and waste rock. The order, which will cover three years, is valued at SEK 350 million. Altogether, Peab will move approximately 10 million cubic meters of overburden to reach the ore body which on average is just 10 meters below the surface. The first phase has just started and is expected to be finished by the end of September 2012, allowing the mining process to begin in the fourth quarter 2012.

In addition, Northland has agreed with Atlas Copco, a leading supplier of mining equipment, to deliver five drill rigs (models Smart ROCD65 and Pit Viper-271E). The first drills are expected to begin operating at the Tapuli mine in October 2012. Atlas Copco Customer Finance will provide financial leases for all drill rigs.

“With the building of the main power line, the start of pre-development and the ordering of the drills, the Kaunisvaara project continues to be built on time”, said Shane Williams, Vice President -- Projects at Northland.


Northland is a development-stage mining company with a portfolio of iron ore projects in northern Sweden and Finland. The Company’s Kaunisvaara Project will exploit two magnetite iron ore deposits in Sweden. The process will yield a very high-grade, high-quality magnetite iron concentrate. The construction of the Kaunisvaara project is well underway and production is planned to start in the fourth quarter of 2012. Northland has entered into industrial off-take contracts which will last for 7--8 years for the entire production from Kaunisvaara. The Company is also preparing a Definitive Feasibility Study for the Hannukainen Iron Oxide Copper Gold Project in Kolari, northern Finland. The study is expected late in the fourth quarter of 2011.

Vattenfall is one of Europe’s largest generators of electricity and the largest producer of heat. Consolidated sales in 2010 amounted to SEK 213,572 million. Vattenfall’s main products are electricity, heat and gas. In electricity and heat, Vattenfall works in all parts of the value chain: generation, distribution and sales. The Parent Company, Vattenfall AB, is 100%-owned by the Swedish state. The core markets are Sweden, Germany and the Netherlands. The Group has slightly more than 38,000 employees. For more information, go to www.vattenfall.com.

Peab is an innovative construction and civil engineering company which combines the strengths of a large group with those of a local company’s ability to create flexible solutions. Net sales 2010 were SEK 38 billion and the company employs approximately 14,000 people across the Nordic region. For more information, go to www.peab.com.

Atlas Copco is an industrial group with world-leading positions in compressors, construction and mining equipment, power tools and assembly systems. The Group delivers sustainable solutions for increased customer productivity through innovative products and services. Founded 1873, the company is based in Stockholm, Sweden, and has a global reach spanning more than 170 countries. In 2010, Atlas Copco had about 33,000 employees and revenues of SEK 70 billion (EUR 7.3 billion). Learn more at www.atlascopco.com .