Northland Resources SA announced that 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 1st 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.

Mr Shane Williams VP projects at Northland said that "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."