CLIFFS NATURAL RESOURCES - FERRO ALLOYS

In late 2010 Altius announced the terms of a strategic exploration alliance with Cliffs Natural Resources Exploration Inc. ("CNR") for ferro alloy metals within specific areas of Newfoundland & Labrador.

The alliance will combine Altius' exploration expertise in Eastern Canada with the capital funding, development and operating strength of CNR. CNR will fund and Altius will carry out regional and generative exploration to a value of $1,800,000 within specific areas over a two year period with the goal of identifying new grassroots exploration targets. The generated targets will be presented to CNR which can then choose to designate such projects as joint ventures.

Projects designated as joint ventures will initially be held 50/50 by Altius and CNR, subject to a 1% net smelter returns royalty in favour of Altius. CNR will have an option to increase its participating interest to 70% by funding $4 million in exploration expenditures, including 3,000 metres of drilling, by the fourth anniversary of the joint venture agreement. CNR may subsequently increase its participating interest to 90% by completing and funding a bankable feasibility study.

Work under the alliance has commenced targeting nickel-iron alloy minerals and chromite in ultramafic complexes on the island of Newfoundland. 3,424 mineral claims (85,600 hectares) have recently been staked over areas of interest, and prospecting, rock sampling and mineralogical studies are underway.

The alliance was expanded in August 2011 to include an iron ore project known as Saglek within northern Labrador. Work programs designed to identify nickel-iron alloy on the island of Newfoundland are also underway and yielding positive results.

The Saglek iron ore project is located between 140 and 240 km north of Voisey's Bay in northern coastal Labrador. Approximately 1,800 claims covering 45,000 hectares have been staked to cover seven priority target areas identified from mapped Archean iron formation and associated magnetic anomalies.