LIM operations update & annual financial re...

Anglesey Mining plc LSE:AYM

29 June 2011

LIM Reports Year End Financial Results

Silver Yards Plant Commissioned

First Iron Ore Rail Shipment from Silver Yards to Port

Anglesey's 33% owned associate Labrador Iron Mines Holdings Limited (TSX: LIM)
reports that it has filed its audited financial statements and MD&A for the
fourth quarter and year ended March 31, 2011. The documents are available under
LIM's profile at www.sedar.com and on LIM's website at
www.labradorironmines.ca.

LIM has made significant strides towards the start-up of production at its
Schefferville Area direct shipping iron ore project in western Labrador, near
the town of Schefferville Quebec. On June 29, 2011 the first loaded iron ore
train departed Silver Yards for the Port of Sept-Iles travelling over the TSH
and QNS&L railways. This historic event is the first commercial iron ore train
from the Schefferville area in almost 30 years.

Production Commenced at James Mine and Silver Yards Plant

Ore mining operations commenced at the James Mine in June 2011 and full scale
mining operations are now underway. Development of the first mining bench in
the north end of the James pit has exposed a mining face over 400 metres along
strike in the higher grade blue ore, the first ore to be mined and directly
shipped without further processing. The waste rock has proven to be largely
free digging and mine development is currently ahead of schedule.

Approximately 120,000 tonnes of iron ore has been stockpiled to date. Ore
mining will continue for the season until November at a mining rate of
approximately 15,000 tonnes of ore per day, using conventional open-pit mining
methods and, where necessary employing standard drilling and blasting
practices. Overburden and waste mining, and some ore mining, will continue
through the winter period. Ore mined will be classed into three products for
direct shipping, plant feed, and stockpiling for treatment in 2012.

The first phase of the Silver Yards plant has been commissioned, including the
primary and secondary crushers, screens, scrubbers, stackers and conveyers.
Overall, the commissioning process was trouble free and performed within the
scheduled time. The Silver Yards plant is now operating largely to
specification though a number of minor issues are being resolved.

The Silver Yards plant has a planned initial processing rate of 6,000 tonnes
per day, which will be incrementally increased to 10,000 tonnes per day. It is
expected that the plant will continue to operate through to November. In future
years the planned annual seasonal processing schedule will cover a period of
seven to eight months, or approximately 210 to 240 days per year, from April to
November or December, depending on weather conditions. A fines recovery system
is currently being installed and this is expected to become operational during
August 2011. This will include installation of a hydrosizer and pan filter. The
installation of this system is expected to increase overall recoveries to about
75% and increase the plant output by approximately 13%.

LIM has experienced some delays with delivery of its rail cars and in
finalizing port and shipping logistics, and this has had the effect of delaying
the first shipment and sale of iron ore. The port handling arrangements are
currently being finalized. Some work is still on-going to complete
infrastructure facilities at the port. Iron ore will continue to be delivered
to the port by train in increasing volumes, and inventory stockpiles will be
built to sufficient size to enable efficient shipping of this ore to the
ultimate customers. It is expected that the first shipment of iron ore will be
loaded at the Port of Sept Iles in early to mid-August.

It is estimated that a total of around 2.5 million tonnes of ore will be mined
from the James Mine during the current financial year and, subject to weather
conditions, that approximately one million tonnes of saleable product will be
railed to the Port of Sept-Iles. It is expected that the majority of this
product will be sold on a spot basis during this financial year. In addition to
these sales it is expected that around a further one million tonnes of both
direct shipping and processed ore will be held in inventory at Silver Yards and
available for shipping and sale in calendar 2012.

The average life of mine operating costs for the James and Redmond deposits
were estimated to be in the range of approximately $50 per tonne. The 2011
season is considered to be a short start-up year and initial unit operating
costs will be higher than the anticipated average. Total operating cash costs
will be dependent on final port and shipping arrangements which have not been
completed.

LIM is currently finalising plans for the expansion of the Silver Yards plant
that should add about one million tonnes per annum to annual production
capacity and, subject to no unexpected construction delays, should come on
stream in the first half of 2012.

LIM is in a strong financial position that will allow it to fund its working
capital requirements for 2011 production ramp-up and enable it to fund its
exploration and expansion plans.

Railroad

The first ore train loaded with direct shipping ore departed Silver Yards for
Sept-Iles on June 29, 2011. This train represents the first commercial iron ore
train movement from the Schefferville area in almost 30 years.

In February 2011, LIM signed a memorandum of understanding ("MOU") with
Tshiuetin Rail Transportation Inc. ("TSH") for the transportation of iron ore
over the Menihek Division with an agreed tariff rate for calendar year 2011.

In March 2011, LIM entered into a life of mine, confidential rail
transportation contract with Quebec North Shore and Labrador Railway ("QNS&L")
for the transportation of LIM's products from the end of the Menihek Division
to Sept-Iles. This contract provides for a confidential tariff, with various
capacity and volume commitments on the part of each party.

LIM also signed a rail services agreement with Western Labrador Rail Services
("WLRS"), a wholly owned subsidiary of Genesee & Wyoming Inc., to provide,
operate and maintain up to five SD 40-3 locomotives which will be used to haul
LIM's iron ore from Silver Yards, over the TSH Railway, to Emeril Junction. The
first three SD 40-3 locomotives have arrived and have been positioned at Silver
Yards.

LIM has purchased a fleet of 400 previously used railcars of which the first
consignment of 132 rail cars has been delivered to Sept-Iles where
modifications are being carried out. Modifications are now complete on more
than half of this first consignment. This process has taken longer than
anticipated due to the modifications required to meet local operating
conditions. A further 128 cars are being shipped to Sept-Iles and the first
fleet of 260 cars is expected to be modified and progressively delivered to
Silver Yards by August.

Port

LIM has signed a MOU with the Sept-Iles Port Authority for the use of the
Pointe aux Basques terminal for handling and ship loading of LIM's iron ore for
the 2011 season and potentially beyond. LIM has also signed an agreement with a
port terminal operator for the unloading, stacking and ship loading of iron ore
at Pointe aux Basques. LIM will have exclusive use of the Pointe aux Basques
terminal for iron ore shipments.

Use of the Pointe aux Basques facilities will require train shunting and
unloading in the adjacent rail yard and loading the iron ore onto barges or
lakers and trans-shipping to larger vessels within the deeper waters of the bay
or to another port. These port handling arrangements are currently been
finalized and are expected to be concluded in time for the first shipments of
iron ore expected in August 2011.

2011 Exploration Program

LIM has commenced its largest ever exploration program on its Schefferville
Area Projects. A total of 17,500 metres of drilling is planned for the 2011
season, using four drill rigs, and a further 4,000 metres of exploration
trenching will be carried out.

The principal targets will be deposits that will comprise Stage 1 subsequent to
James and Redmond, and to further work on the Stage 2 deposits at Houston. The
deposits to be explored will be Knob Lake, Ruth Lake 8, Gill, Star Creek and
Denault for Stage 1, and Houston 1, 2 and 3 plus Malcolm for Stage 2. Some
additional definition drilling will be also carried out on the James and
Redmond deposits

It is planned to carry out further airborne geophysical surveys to continue to
identify extensions to current deposits as well as potential new targets. In
addition it is planned to carry out some field exploration of a number of the
more distant deposits in Quebec. This work will be used in planning further
exploration in the following season.

First Nations Developments

In June 2011 LIM signed an Impact Benefits Agreement with the Nation Innu
Matimekush-Lac John of Schefferville, Quebec. The historic life-of-mine
Agreement is a significant step for LIM and for the Innu Community of
Matimekush-Lac John, paving the way for the development of a project that will
provide opportunities for the local community at Schefferville, and
particularly its youth, and will at the same time protect the environment and
Innu traditional and cultural activities.

In December 2010, LIM signed an Agreement in Principle ("AIP") with the Innu
Takuaikan Uashat Mak Mani-Utenam (Sept-Iles), which stipulates the principal
terms to be included in an IBA. Negotiations with the Innu Takuaikan Uashat Mak
Mani-Utenam Quebec towards the completion of an IBA have been concluded, and it
is expected that the agreement will be submitted to the community of Takuaikan
Uashat Mak Mani-Utenam for ratification later in the year.

Marketing - iron ore markets

Marketing discussions have continued with potential customers, both in Europe
and in Asia. Chinese consumers, in particular, are showing an increasing
interest in seeking iron ore from Canada, driven by continued strong demand and
a desire to diversify from their traditional sources of supply. Canadian iron
ore is generally regarded favorably on world markets with its relatively high
iron grades and low levels of deleterious elements.

It is expected that iron ore products produced in 2011 will be sold into the
spot market on a "FOB Sept-Iles" basis. LIM continues to review its options for
marketing its planned iron ore production and is evaluating the optimum route
to achieve these sales, while still maintaining maximum flexibility and
independence. In particular LIM has had detailed discussions with a number of
internationally recognized commodity traders with specialist knowledge of the
iron and steel industry and expects to finalize marketing arrangements with one
of these for the sales of its initial 2011 ore production.

The global iron ore market remains positive though spot prices for 62% Fe
sinter fines have fallen from first quarter 2011 highs of around US$190 per
tonne (CFR China) to around US$170 per tonne in recent weeks. Current efforts
by the Chinese government to slow down some aspects of growth of the Chinese
economy, has likely been the reason for some slowing in Chinese purchases and
hence the recent reduction in spot prices. These reduced purchases have
reportedly resulted in some levels of destocking, however, there are signs that
this destocking is now being reversed which should lead to stronger prices in
months to come.

Demand for steel and therefore iron ore appears likely to remain strong and
continue to grow in the coming years. In the short to medium term, with demand
remaining strong, prices are forecast to only retract marginally. Recent
forecast consensus indicates that iron ore supply and demand will remain
generally in balance until around 2015 to 2016, with prices dropping only
10-15% in that period, possibly followed by a supply surplus, with prices
declining somewhat thereafter. LIM is of the opinion that iron ore prices will
remain strong around current levels for both calendar 2011 and calendar 2012.

Financial Results

For the year ended March 31, 2011 LIM reported a loss of $3,971,651, or $0.09
per share compared to net income of $1,164,772, or $0.03 per share, for the
prior year. The increased loss arose largely from an increase in activities
combined with changes in stock based compensation and future income taxes.
Stock-based compensation of $1,106,764 in fiscal 2011 compared to $85,973 in
the prior year, from the granting of stock options during 2011. In addition, a
future income tax recovery of $832,407 in fiscal 2011 compared to a future
income tax recovery of $3,912,647 in the prior year.

In fiscal 2011 LIM invested substantially in its mineral property interests in
the development of its iron ore projects. During fiscal 2011, LIM invested
$12,192,150 in its mineral property interests, compared to $7,403,537 invested
during the prior year. In the latest fiscal year, LIM also invested $14,869,430
in property, plant and equipment, compared to $7,037,601 invested in the prior
year. The substantial investment in property, plant and equipment during fiscal
2011 related mainly to LIM's construction of the processing plant,
accommodation camp and rail spur line in Silver Yards during the year.

As at March 31, 2011 LIM had $7,563,670 in cash and cash equivalents, (not
including restricted cash), and had no debt. Subsequent to March 31, 2011 LIM
completed a prospectus financing, raising gross proceeds of $121,250,500. LIM
believes it has sufficient funding to complete the commissioning of the first
phase of Stage 1 of its direct shipping iron ore mining projects and to
commence shipments of iron ore to begin generating operating cash flow.

About Labrador Iron Mines Holdings Limited

LIM's Schefferville Project involves the development of twenty direct shipping
iron ore deposits in western Labrador and north-eastern Quebec near
Schefferville, Quebec. The properties are part of the historic Schefferville
area iron ore district where mining of adjacent deposits was previously carried
out by the Iron Ore Company of Canada from 1954 to 1982.

Labrador Iron Mines contemplates mining in stages, the first phase of Stage 1
comprising the James and Redmond deposits, which are located in close proximity
to existing infrastructure. Full scale mining and processing is underway and
the first train carrying direct shipping ore departed LIM's Silver Yard for
Sept-Iles on June 29 2011.

For further information, please view LIM's website at www.labradorironmines.ca.

About Anglesey Mining plc

Anglesey Mining with its LSE main board listing is primarily focused on its 33% 
interest in Labrador Iron Mines (TSX:LIM). In addition to any new projects that 
may be brought forward the company owns 100% of Parys Mountain in North Wales 
with an historical resource in excess of 7 million tonnes at over 9% combined 
copper, lead and zinc.

For further information, please contact:  
Bill Hooley, Chief Executive [phone]; 
Ian Cuthbertson, Finance Director [phone]; 
Samantha Harrison / Shaun Whyte, Ambrian Partners Limited  [phone]; 
Emily Fenton / Jos Simson, Tavistock Communications [phone] / [phone].