Newfoundland and Labrador, Canada

December 2009From iron sands to iron making in Eastern Canada

- massive heavy mineral sands deposit located next to sea port

Our immediate goal….We seek an equity partner with $30 million

The Company with over 300 drill holes has solved the 113 year old challenge facing this deposit. The breakthrough has produced a viable economic model.

The Company at a minimum will produce iron (e.g. pig iron or iron nuggets) – the possibility of producing steel makes economic sense and will be evaluated.

The $30 million will see the project through to mining lease (Bankable Feasibility, Environmental and Resource Delineation). Portion will be used to expand resource size as well as a pilot plant using electricity for iron making.

The final phase will raise $400 million (with the possibility of Canadian government providing 50%)

i. Interest in debt in exchange for off-take rightsii. Interest in IPO from major global investment banker (post feasibility)iii. Likely control interest from largest operator of electric arc furnaces in US

Key Business SensitivityPrice of pig iron

◦ Currently selling for $310-325/tonne◦ Speculation from forecasters is wide ranging but typically

$400/tonne is common forward price targetManaging against price

◦ Pig iron is a raw material required to make steel – very few can match our cost of production (top 10% of low cost producers)

◦ Focused on reducing shipping and handling◦ Focused on supplying markets within 7 days shipping –

closer targets than Russia and Brazil ◦ Targeting firms that value pig iron made under solid

environmental conditions

Location - Northeast CanadaDirect access to US and Europe by sea (less than 7 days) – resource covers more than 600 square kilometres – river and land.

Happy Valley – Goose Bay

Ironsands DepositHappy Valley-Goose Bay, Labrador

• Unique Canadian Mineral Project – nature has done the work

• Dredging, gravity and magnetic separation – environmentally safe mining and processing

• Adjacent to a full service community and workforce – population 7,600

• Port Community

• Low Cost Hydro Power ~$0.05/kWh

• Enormous resource body

Ironsands in Raised Dunes in river

Grand River Ironsands Incorporated (GRI) Private Company with 93 shareholders including major shareholders - Innu

First Nation and Chinese investor/advisor – Grand Overseas Economic Development

Company has been developing the claims since 2000; new management and board in 2007

16.5 million shares fully diluted

8 person Board – including Band Chiefs from the two Innu First Nation communities in Labrador

Operating focus is balancing geology, metallurgy and economic considerations

Have invested approximately $5 million over past 9 years understanding and advancing the mineral resource and business model

What we believe GRI will be an environmental leader in mining – using gravity, water and magnets –

Nature has done blasting and crushing over the past 7,000+ years

Low Cost Production◦ Iron ore concentrate at under $20 per tonne◦ pig iron (96-97% Fe) production cost under $200 per tonne◦ Steel billets for approximately $300 per tonne

Locational benefits – rare in the world to have all on one footprint – full service community, port, low cost power, large resource, workforce

Using robust environmental controls we will be able to produce a high quality pig iron at an operating cost under $200 per tonne – only a few globally can do lower

Iron making◦ Coal-based approach meets or exceeds environmental standards◦ Electricity-based approach will generate carbon credits – will be an environmental leader in

iron making

What we have achieved to date… For the first time in 113 years – when deposit was discovered – we have established a

productive use for the resource – confirmed by various technical experts

We have developed, with industry (geology, mining, iron making and investment bankers) a financial model that supports viability

We have drilled approximately 300 holes on the river targets and more than 40 on land targets. Moreover, we understand how the deposit was created and predictive models for optimal targeting.

We have researched and begun melt tests on the likely approaches to iron making

Have developed solid relationships with all levels of government, the Innu First Nations (land claim owners), local people in host community, environmental groups and industry participants – investment bankers, steel producers, pig traders, etc.

Expressions from the provincial government of tax credits totaling an possible $150 million over first 20 years; a Federal government that has expressed an interest in providing 50% f debt for coal based approach; governments interested in funding a portion of $30 million pilot plant using electricity

Simple Business Model One footprint approach

◦ Mine, produce iron ore concentrate and make pig iron all in same immediate location – reducing shipping and handling costs

Ship less volume of a higher value product◦ Rather than shipping 1.6 tonnes of iron ore concentrate (cost of $20/t that sells for

$60/t) – we will ship 1 tonne of pig iron (cost of $175/t that sells for $325/t) – that is 37% less shipping weight (at $0.50/t/day at sea)

Co-locating with key infrastructure◦ Port, full service community (hospitals, recreation, homes, schools, suppliers, airport,

etc.), low cost hydro power and workforce

Resource supply for generations – to make 500,000 tpa of pig iron◦ If mining areas with 11% heavy mineral concentrations will need to mine

approximately 1 square km per year to 10 metres depth◦ If mining areas with 22% heavy mineral concentrations will need to mine 300 X 300

metres X 20 metres depth ◦ Overall resource area is estimated at more than 600 square kilometres

Key decisions in 2010…

Finalize investment partners and approach – the next round of $25 million of investment may chose that path in whom we partner with:◦ Steel producers (seek pig iron as a raw material) ◦ Pig Iron traders (seek to re-market to mills and foundries)◦ Investment banker (Public Offering)

Select technical team for Bankable Feasibility

Determine primary mining targets – land or river

Select the iron making technology1. SLRN (Outotec) coal based system to fuel kiln – Rotary kiln + electric furnace to

make pig iron, or2. Cardero Resources – electricity based system – from briquette to pig iron casting

(or molten iron if steel making is desired end product)

China (Dalian Port) would be 25 days by sea at a speed of 20 nautical miles or 42 days at a speed of 12 nautical miles

Mineral Sands – Cost AdvantageNo blasting, no crushing – lower capital cost and minimal impact to land reducing environmental remediation costs – dark strands are heavy minerals

The Mining Process – Dredging SandsDredger capable of extracting 5,000 tonnes of sand per hour – low tech and proven approach

Low Cost Separation and ConcentrationSpiral Separation (water and gravity) and Wet Magnetic Separators to produce final products – low tech and proven technologies for separation

First Pass Spiral – Gravity SeparationHigh Grade Magnetite at 68.3% FeTi-Mag is 56.68% Fe and 7-11% TiO2

Dredge and conveyor to the processor and a return circuit after separation of valuable minerals

100 % of River Sands

Sands (dried) from the river after dredging

Gravity Spiral—Uses WaterSilica Sands (returned to the river or land)

77-88% of River Sands

Magnetite (66.1 - 68.3% Fe)

Heavy Mineral Concentrate

12 - 23% of River Sands

Magnetic Separators and Rare Earth Drum Rollers— extracts magnetite & titanmagnetite and two other products of value

Titanmagnetite GarnetZircon

Overview of Producing Iron Ore Concentrate (Magnetite and Titanmagnetite)

Magnetite + Titanmagnetite =Iron Ore Concentrate to make Pig Iron

Magnetite (66-68% Fe from River – 1% of head feed)

Titanmagnetite (56% Fe and 7-11% TiO2 from River – 4% of head feed)

+

Pig Iron/Iron ProductsTakes 1.6 tonnes of iron ore concentrate to produce 1 tonne of pig – the cost edge starts with iron ore concentrate at $20 per tonne

SLRN (Outotec)Coal-Based - 50+ plants

BlueScope Steel (formerly New Zealand Steel)

The ironsands of Grand River are superior to the chemistry of NZ

Mining LifeNot yet quantified due to enormous size

Generally we know/believe:

1. River Claim is 144 square Kms

2. Land Claim is 475 square kms

To produce 500,000 tpa of pig iron requires 800,000 tpa of iron ore concentrate

River will be mined to 20 metres; land to 30-50 metres depth

800 ktpa of iron ore concentrate To 10 metres = < 1 sq km To 20 metres = < 0.5 sq km

1

2

Goose Bay

*Port

Financial Model Scenario - Pig Iron CapEx $368mm (50/50 Debt:Equity)

◦ Mining - $83 million◦ Iron Making - $285 million

Revenue $200 million◦ 500,000 tpa @ $400/t

EBIDTA $112 million

EBT (earnings before taxes) $78 million

IRR is 30% (at $400/tonne)◦ potential for 20 years of tax credits to increase IRR to 36%

Model doesn’t include potential revenues from garnet, zircon, titanium or carbon credits sales

Next Steps… Finalize the $30 million investment to fulfill requirements to

build out the project ($400 million)

Complete resource delineation (NI 43-101); environmental permit; bankable feasibility study for iron making and securing approval for mining lease

Key considerations for success◦ Iron making technology (coal or electricity)

If coal fired approach; there is immediate interest in financing if electricity, will require pilot plant to first prove up

◦ Canadian government is prepared to provide up to 50% of CapEx in form of loan◦ Interest from NL Hydro and Province in attracting electric smelting to HVGB –

project is next to the proposed $12 billion Lower Churchill Hydro project (2,800 MW generation)

Our goals… To secure an operating partner that has a need for the end products produced (pig iron

or billets)

◦ Pig Iron with 95-97% Fe; 3-4.5% Carbon; Sulfur <0.05-1.0%; Silicon <0.1-0.5%; P <0.05-0.1%; Mn – Trace; TiO2 <0.1%(Right: pig button from river sands + TiO2 slag)

Successfully proving Phase I of producing 500,000 tpa of iron making (pig iron) to enhance future phases. Resource base and markets can easily support increasing to 2 mtpa.

To focus on value-add as promised to the community and Innu partners.

Be an environmental leader in mining, processing and iron making and subsequent benefits (carbon credits). The ideal model would focus on using electricity-based model.

www.grandriverironsands.comThank you!