OPERATOR: Good morning, ladies and gentlemen. Welcome to the Alderon Feasibility Study Review Conference Call. I would like to introduce Tayfun Eldem, the President and CEO of Alderon Iron Ore Corp. Please go ahead.

TAYFUN ELDEM: Thank you operator. Good morning, ladies and gentlemen. My name is Tayfun Eldem and I'm the President and CEO of Alderon Iron Ore Corp. With me this morning we have Alderon's Executive Vice President of Project Delivery, Mr. Bernard Potvin, as well as Alderon's General Manager of Projects, Miss Fay Pittman.

I'm pleased to share with you this morning the results of our feasibility study which marks yet another milestone in Alderon's journey towards production. I'll use the first 20 minutes of the call to provide you with key information pertaining to the results of the feasibility study and then I will open it up for questions.

Alderon's feasibility study was completed by BBA, Stantec, and Watts, Griffis and McOuat, or WGM and it is based on months of studies and fieldwork including in-fill drilling and geotechnical modeling to establish measured and indicated resources for the Kami project, metallurgical testing to establish processing design criteria and final product specifications, geotechnical drilling and assessment to determine pit slopes, building and infrastructure locations, topographical surveys to determine railway routing and of course mine and process engineering studies to confirm the mine plan and process flowsheet.

The feasibility study is based on the combined Rose Central and Rose North deposits, which have a total measured and indicated resource of 1.1 billion tonnes [at 29.6% total iron]. Our total resource space also includes Mills Lake deposit with a total resource of [measured and indicated resource of 181 million tonnes at 29.8% total iron and an inferred resource of 75 million tonnes at 29.3% total iron], however, Mills Lake was not included in the feasibility study and it will be dealt with and incorporated into our mine plan in future years.

Additionally, the feasibility study is based on a nominal production rate of 8 million tonnes per annum of concentrate for sinter feed. As you know, the Kami project was registered in the Environment Assessment process with a view to producing 16 million tonnes per year. We will assess the expansion option as part of a separate feasibility study after we commission the first 8 million tonnes per annum phase. If deemed feasible, the Environmental Assessment work currently underway for a 16 million tonne per annum operation will help us fast track the EA process for the expansion phase.

Now, moving on to the results. The feasibility study demonstrates very robust project economics. Based on the 8 million tonnes per year capacity and a 30-year mine life, producing concentrates at a grade of 65.2% iron, the project yields an NPV of $3.24 billion dollars at a discount rate of 8% and an internal rate of return of 29.3%.  These numbers are all pre-tax and post-tax numbers have been included in our news release and they will be part of the NI43-101 technical report to be posted later on.

This financial analysis is based on the following underlying assumptions. The initial CAPEX is expected to be $1.27 billion and it includes any contingencies. Average life-of-mine unit operating costs are expected to be $42.17 a tonne. The financial analysis also includes sustaining capital and closure costs of $642 million dollars and $48.1 million dollars, respectively. The feasibility study assumes a realizes FOB sale price of $107.00 per tonne for the first 5 years and $102.00 per tonne thereafter, taking in account the premiums for higher iron content and the discount to our strategic partner, Hebei Iron and Steel. Obviously, compared to our PEA that we issued in October 2011, prices have been brought downwards reflecting the revised outlook for commodity prices.

The pit shell and design used in the feasibility study result in proven and probable reserves for the Rose pit of 668.5 million tonnes [at 29.5% total iron]. This provides for a mine life of 30 years, an annual production rate of 8 million tonnes per year and an average strip ratio of 1.66. The strip ratio, as you may have noticed, is significantly lower compared to the 2.21 we had in our PEA and this has had a very favorable effect on our operating costs.

From a processing standpoint, the projected weigh yield on a dry basis and iron recovery, are 34.9% and 77.4% respectively. For those of you who like to compare this weight yield to other operations in the region that report on a natural basis, Kami Project's weight yields will be 36.3%.

Our current schedule sees us entering into production in Q4 2015 with 2016 as the first year of revenue generation and this is consistent with the schedule that we have been sharing with everyone. Based on the project financials and our ramp-up profile, the project has a 3.8-year payback at an 8% discount rate.  From a break-even perspective, the project breaks even at a Platts spot price of $70.00 a tonne, landed in China for 62% Fe concentrate.

Moving on, the details of the capital costs and the average life-of-mine operating costs were provided in this morning's news release. I will, therefore, focus on the variance between the feasibility study and the PEA for these cost estimates.

Before we go into detail I think it's important we recognize that, overall, there are significant differences between the project covered in the PEA and the project coming out of our feasibility study. The most significant differences are we have a much larger resource, which gives us a longer mine life and, of course, a bigger operational footprints. This means more waste rock and bigger waste rock stockpiles as well as more tailings and a more complex tailings management system. The feasibility study has increased definition over the PEA as a result of more engineering as we discussed, metallurgical testing, geotechnical drilling and assessment to understand bedrock competency and overall pit slope, as well as topographical surveys to help with routings. The feasibility study also incorporates controls needed to comply with all environmental regulations. And, of course, there is greater clarity on some cost elements like port fees and projected electrical power raises.

That said, the flowsheet and process design released remains fundamentally unchanged. The operations will consist of an open pit mine with drill and blast, load and haul and in-pit crushing. An overland conveyor will link the crusher to the concentrator. The concentrator will be made up of autogenous grinding, gravity separation and magnetic recovery circuits. We will have a tailings management facility, with controls for total suspended solids and ammonia discharge to comply with regulations. The rail transportation, in our feasibility study, is based on Alderon utilizing QNS&L and CFA to link our mine site to the loading terminal. And, lastly, we are operating our own terminal in the Sept-Iles operations with a dumper, stacker, and reclaimer feeding the port of Sept-Iles operations through the new multi-user port facility that is currently under construction.

So, if we turn our attention to the variance in our capital cost estimates relative to the PEA, we can see that the capital estimate has risen by $284 million, or 28.6% from the PEA. This variance is driven by a number of factors. Firstly, there's an increase in site infrastructure due to the larger footprint of the mine; whereby we will need 15 km of additional access roads. As well, we have added electrical redundancy at the main sub-station to ensure that we can ride through interruptions and we have incorporated higher degree of automation and telecommunications to the flowchart. We also have seen an increase in steel and concrete quantity and unit cost based on geotechnical assessment and pricing updates, as well as of course detailed design for buildings. We have a slightly longer over land conveyor, due to the revised location of the in-pit crusher relative to the concentrator. Again, this is driven by where we need to locate the crusher so that we have competent bedrock. We have a larger and more complex tailings management operation, which now incorporates controls for total suspended solids and ammonia. We have higher indirect costs and these are driven by a larger construction camp as accommodation requirements were underestimated in the PEA.  The PEA had a large portion of the construction workers accommodated in existing accommodations in the region, which has now proven to be not sufficient and therefore we need to build a larger camp. And, of course, the indirect costs impact the direct costs and as the indirects rise, so do the direct costs.

We also have a slightly longer railways connection to QNS&L based on topographical assessment and the need to maintain grading.

The reduction in capital from the PEA came mainly by way of less pre-production stripping as a result of the optimized pit design, which I'll speak to in some detail later on.

Turning our attention to the operating cost. When we look at our unit operating cost variance relative to the PEA, the average life-of-mine unit costs are reduced by $2.70 a tonne, or 6.4% and this is largely as a result of the lower strip ratio achieved through the pit optimization exercise we undertook between October and December 2012.

This well and truly speaks to the value that we were able to draw from the project through the extra time we took between October and December to complete the pit optimization. Overall, the project net present value has improved by $178 million dollars from the PEA. The negative effects of a lower commodity price and higher capital have been more than offset by our lower operating costs and a longer mine life.

As stated in our news release, the feasibility study results meet all of the threshold criteria for Hebei’s project-level investment of $120 million dollars. We will be delivering the official feasibility study to Hebei in the latter half of this month and expect to close the next tranche of their investment sometime in February and this is consistent with the timeline captured in our agreement.

So, looking ahead, this year will be another busy one. Our focus will be on advancing detailed engineering. We will be preparing for construction by ordering long-lead items as well as erecting our construction camp in anticipation of construction commencing towards the end of the year. We will be completing our Environmental Assessment process and obtaining the required releases and permits. We expect the Environmental Assessment release by the end of September or early October and permits by November and these will pave the way for us to start construction in November 2013.

As well, with Hebei’s assistance, we will be looking to secure another strategic partner to take on the remaining uncommitted 40% of production. In fact, these discussions are very well advanced and we continue to explore opportunities in Taiwan, Korea and Japan. As well, we are in discussions with a handful of traders both in Japan and Europe. And, last but not least, we will be advancing our formal power and rail agreements towards conclusion. And we will be of course be commencing construction, as I stated, based on the timelines at the end of 2013 with a 24-month construction window taking us to the first commercial production at the end of 2015.

On that note I'd like to thank you all for your attention.


Special Note Regarding Forward-Looking Information

This presentation contains "forward-looking information" concerning anticipated developments and events that may occur in the future. Forward looking information contained in this presentation includes, but are not limited to, statements with respect to: (i) the estimation of mineral resources and mineral reserves; (ii) the market, demand for and future price of iron ore and related products; (iii) success of exploration activities; (iv) the completion and timing of the permitting and environmental assessment process; (v) the negotiation and conclusion of infrastructure contracts; (vi) expected infrastructure requirements; (vii) potential economic benefits of the Kami Property; and (viii) the results of the FS including statements about future production, future operating and capital costs, the projected IRR, NPV, payback period, construction timelines and production timelines for the Kami Property.

In certain cases, forward-looking information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" suggesting future outcomes, or other expectations, beliefs, plans, objectives, assumptions, intentions or statements about future events or performance. Forward-looking information contained in this press release is based on certain factors and assumptions regarding, among other things, the estimation of mineral reserves and resources, the realization of resource estimates, iron ore and other metal prices, the timing and amount of future exploration and development expenditures, the estimation of initial and sustaining capital requirements, the estimation of labour and operating costs, the availability of necessary financing and materials to continue to explore and develop the Kami Property (as defined herein) in the short and long-term, the progress of exploration and development activities, the receipt of necessary regulatory approvals, the completion of the environmental assessment process, the estimation of insurance coverage, and assumptions with respect to currency fluctuations, environmental risks, title disputes or claims, and other similar matters. While the Company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include risks inherent in the exploration and development of mineral deposits, including risks relating to changes in project parameters as plans continue to be redefined including the possibility that mining operations may not commence at the Kami Property, risks relating to variations in mineral resources, grade or recovery rates resulting from current exploration and development activities, risks relating to the ability to access rail transportation, sources of power and port facilities, risks relating to changes in iron ore prices and the worldwide demand for and supply of iron ore and related products, risks related to increased competition in the market for iron ore and related products and in the mining industry generally, risks related to current global financial conditions, uncertainties inherent in the estimation of mineral resources, access and supply risks, reliance on key personnel, operational risks inherent in the conduct of mining activities, including the risk of accidents, labour disputes, increases in capital and operating costs and the risk of delays or increased costs that might be encountered during the development process, regulatory risks, including risks relating to the acquisition of the necessary licences and permits, financing, capitalization and liquidity risks, including the risk that the financing necessary to fund the exploration and development activities at the Kami Property may not be available on satisfactory terms, or at all, risks related to disputes concerning property titles and interest, environmental risks, and the additional risks identified in the “Risk Factors” section of the Company’s Annual Information Form for the most recently completed financial year or other reports and filings applicable with Canadian securities regulators. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information is made as of the date of this press release. Except as required by applicable securities laws, the Company does not undertake any obligation to publicly update or revise any forward-looking information.