Dannemoras Mineral Reserve updated

An update of the Dannemora Mineral Reserve was concluded December 23. 2011. The
new estimate of the Mineral Reserve shows an increase with 6.9 million tonnes to
a total of 35.1 million tonnes, while the iron content in the crude ore has
decreased with 0.94 percent. The entire Mineral Reserve is classified as
probable.

The basis for this estimate is the updated Mineral Resource which was reported
in August 2011 and includes the recently core drilled mineralization Norrnäs 3
and a change of the cut-off grade to 20 percent iron. The former estimate was
based on a cut-off grade of 30 percent iron.

The lower cut-off grade affects the amount of waste rock and consequently the
iron content.
The reported tonnage and waste rock dilution are a function of the chosen mining
method, sublevel caving. The wall rock in Dannemora is generally very stable. In
the estimated mineral reserve it is assumed that, in most cases, one meter of
wall rock will dilute the ore. This wall rock is assumed to contain five percent
iron.

The reported Mineral Reserve includes 14 different mineralizations distributed
along the total length of the ore field, 3 kilometers. In order to achieve an
even quality of products, the feed of crude ore into the sorting plant must be
blended from different ore bodies. The crude ore will be treated in a dry
magnetic process (under construction) that is designed to produce 60 per cent
lump ore and 40 percent fines. The lump ore will contain 50 percent iron and the
fines 55 percent iron.
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