Nevada Iron Ltd - Quarterly Report for the period ended 31 March 2014

HIGHLIGHTS

• Acquisition of New Mineral Rights adds an estimated 1.6 million tonnes of ore grading 13.5% Fe;
  
  
• Ground mapping over the newly acquired Section 27 area has identified an area 800m long by an average width of 180m wide with extensive magnetite surface float coincident with strong magnetic anomaly.
  
  
• Samuels Engineering retained to complete detailed design of process plant;
  
  
• SRK Consultants retained to design dry stack tailings impoundment and waste rock dumps;
  
  
• Geomega Environmental Consultants retained to assess impact of mining operations on groundwater;
  
  
• Broadbent & Associates retained to prepare air permit application; and
  
  
• Sale of used Rod Mills for US$850,000 completed.

WEST PERTH, Western Australia, April 30, 2014 /CNW/ -

Overview

Nevada Iron Ltd. (ASX Code: NVI, TSX Code: NVR) is a resource company focused on the development of the Buena Vista Iron Project located in northern Nevada, USA. This project demonstrates the attributes for a successful iron ore development, namely:

• Near surface resource;
• Very low waste to ore ratio (0.5:1);
• Easy metallurgy with a coarse grind producing a high grade (67.5-69% Fe) and clean concentrate;
• Close to existing nearby transport infrastructure and no requirement to build significant infrastructure, e.g. a rail line;
• Access to existing ports;
• Manageable capital cost;
• Stable and mining friendly jurisdiction;
• No government royalty imposts; and
• Phase 1 project on private land, making permitting less onerous.

Buena Vista Iron Project, USA (100%)

Acquisition of New Mineral Rights

On 29 January 2014, the Company completed the acquisition of 278.61 acres of free hold land (including mineral rights) adjacent to the existing West Deposit (covering the western half of Section 9 T24N R34E in Churchill County, Nevada). The acquisition of this land accomplishes several strategic objectives:

• Adds an estimated 1.6 million metric tonnes of ore grading 13.5% Fe in the southern portion of the West Deposit Pit. This additional ore was sterilised due to the position of the final pit wall, which abutted the property boundary. The land acquisition allows the repositioning of final pit walls to better exploit the mineral resource.
  
  
• Provides additional exploration potential for mineral resource extension across the acquired property. The current mineral resource estimate was terminated at the previous property boundary and as seen in Figure 1, the magnetic anomaly clearly extends across the boundary.
  
  
• Expands options for the location of key infrastructure.
  
  
• Increases the buffer zone around the proposed plant, tailings disposal facility and West Deposit Pit, which:
• reduces the impact on the neighbouring land owners;
  
  
• improves access to the proposed facility;
  
  
• reduces capital and operating costs by simplifying dust control requirements; and
  
  
• simplifies the permitting procedure.

The consideration paid was US$400,000 in cash and a 2% NSR on production from the area purchased.

Exploration

Ground mapping over the recently acquired Section 27 area (3km to the north east of the West Deposit) has identified an area 800m long by an average width of 180m wide with extensive magnetite surface float (Figures 2 and 3).

No mineral resources have been defined for the Section 27 target but the mapping indicates the presence of a large area of strong magnetite mineralisation. Following the encouraging surface mapping results, the Company moved quickly to cover the area with ground magnetics and the resulting anomaly is shown in Figures 4 and 5.

The magnetic anomaly measures 1.6km long by 1km wide and appears to have a stronger intensity than the anomaly that covers the existing mineral resources at the West, Section 5 and East Deposits.

Drilling of the Section 27 target is planned during the upcoming field season and results will be released as available. The presence of extensive high-grade magnetite on surface and a large strong intensity magnetic anomaly provide excellent indicators for the targeting of drill holes.

Environmental Permitting Activities

All mines operating within the State of Nevada are required to obtain several permits including, but not limited to, the Water Pollution Control Permit (WPCP), Reclamation Permit and Air Quality Permit. The WPCP and Reclamation Permit are issued by the Nevada Division of Environmental Protection (NDEP) Bureau of Mining Regulation and Reclamation (BMRR). The primary purpose of the WPCP is to protect all surface and ground waters. Therefore, initial engineering designs must be completed identifying each process component, where water and/or chemicals will be used in the process, and how the liquids will be contained to prevent release to the environment.

Nevada Iron has retained Samuels Engineering of Denver Colorado to design the crushing and milling circuits. SRK Consultants of Reno Nevada have been retained to design the dry stack tailings impoundment and the waste rock dumps, and to prepare the permit application. Geomega Environmental Consultants of Boulder Colorado were retained to characterise the potential impacts to surface and ground water. Finally, Broadbent & Associates of Henderson Nevada have been retained to run the air modelling and prepare the Air Permit application.

While work began in the December quarter of 2013 to begin gathering the necessary characterisation data, the pace accelerated in the 1st Quarter of 2014.

Information required in the WPCP application includes characterising the lithology and hydrology at least 100 feet below each process component. Therefore, two (2) drilling programs have been completed: first in and around the proposed pits; second around the proposed tailings location, and samples of the alluvium and waste rock have been collected and submitted for geotechnical testing.

Ground Water Characterisation

1) During the quarter, five (5), 800 feet deep ground water characterisation wells were completed around the proposed West and Section 5 pits. These holes, drilled solely through the iron ore body, found that there is little ground water flowing through the iron ore deposit, which indicates that it is unlikely that a pit lake will form post closure and that dewatering will not be required during mining. This simplifies the permitting process.

The information gathered is being used to build the ground water model, required to predict the impacts of mining on the surrounding groundwater aquifer.

2) In addition, five (5) ground water characterisation wells averaging 500 feet deep were also completed around the proposed dry stack tailings impoundment. These wells, drilled through alluvium and/or bedrock to characterise the soils and ground water under the dry stack tails, found that there is limited ground water within the alluvium. This also simplifies the permitting process. This information is being used in the construction of the ground water model and the design of the dry stack tailings impoundment.

No Potential Acid Generation

The Company is also required to identify whether a pit lake will exist post closure and whether or not the pit walls and any future pit lake will be acid generating. The Ultimate Pit Surface (UPS) for the West and Section 5 pits was identified within the 43-101 Pre-feasibility Study. Those UPS's were used to identify the lithology's that will be exposed at end of mine. With concurrence from the BMRR, representative overburden, waste rock and ore samples were selected from core from both pits. The samples were analysed for the acid generating potential. The analytical results were then used to select samples that were tested in Humidity Cells, as required by BMRR. The rock samples are loaded into "Humidity Cell" columns and water trickles through the columns for a minimum of 20 weeks. This test is used to predict the geochemical response of the various rocks when exposed to moisture. BMRR accepted the results of the humidity cell tests, which indicated that the rock is ~300 times net neutralising, in other words, there is no acid generation.

The fact that the waste rock is non acid generation is a major positive for the project permitting.

Samuels has finished preliminary designs for the crushing and grinding circuits. Air models are being run by Broadbent & Associates of Henderson Nevada. The air model utilises local meteorological data to predict potential air emissions from the crushing and grinding circuits. The results of the air model are being used to identify the necessary air emission abatement equipment.

Test work is being completed to verify the choice of the processing equipment and design. With the completion of the test work and air modelling, Samuels will finalise the design and drawings for inclusion in the WPCP.

Sale of used Rod Mills

Following an extended sales programme, on 4 April 2014 the Company completed the sale of three used Nordberg Rod Mills that were excess to requirements. The total consideration received was US$850,000.

The mills were purchased by previous management in October 2011 and have remained in storage in Arizona since that time.

The current Board of the Company determined that as a result of the increase in scale of the Buena Vista Iron Project the mills were superfluous to the Company's needs and in August 2012 initiated a worldwide sales programme.

Narracoota

Latin Gold Limited is the operator of the Narracoota joint venture. Under the terms of this joint venture Latin Gold can earn a 90% equity interest in the project through the expenditure of $500,000.

On 11 April 2014, Latin Gold advised that it had withdrawn from the joint venture and recommended that the project (EL52/1496) be allowed to lapse.

Mick McMullen

(signed) Mick McMullen

Executive Chairman

Competent Persons Statements

The information in the report that relates to the Mineral Reserves of West Deposit is based on information compiled by Declan Franzmann, who is a Chartered Professional Fellow of The Australasian Institute of Mining and Metallurgy. Mr Franzmann is employed by Citraen Pty Ltd and has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Mineral Resources and Ore Reserves" and to qualify as a "Qualified Person" under NI 43-101. Mr Franzmann consents to the inclusion in the news release of the matters based on his information in the form and context in which it appears.

The Company has determined, in accordance with the 2012 JORC Code, that the increase in mineral reserves is not material (being a 1% increase in contained metal) and that Table 1 is not required.

Information in this report to which this statement is attached that relates to Exploration Results is based on information compiled by Mick McMullen, who is a Member of the Australian Institute of Mining and Metallurgy. Mr McMullen is an officer of the Company, is self-employed and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity to which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr McMullen consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

JORC TABLE 1

Section 1: Sampling Techniques and Data

Section 2: Reporting of Exploration Results

MINING TENEMENT STATUS

As at 31 March 2014 the Company held the following tenements:

During the quarter ended 31 March 2014, the Company acquired the following tenements:

The Company does not have an interest in any farm in or farm out agreements.

SOURCE Nevada Iron Ltd.

Image with caption: "Figure 1 - Location map showing acquired Mineral Rights and ground magnetics (CNW Group/Nevada Iron Ltd.)". Image available at: http://photos.newswire.ca/images/download/20140430_C5917_PHOTO_EN_39808.jpg

Image with caption: "Figure 2 - Extensive magnetite surface float (CNW Group/Nevada Iron Ltd.)". Image available at: http://photos.newswire.ca/images/download/20140430_C5917_PHOTO_EN_39809.jpg

Image with caption: "Figure 3 - Close up of high grade magnetite float (CNW Group/Nevada Iron Ltd.)". Image available at: http://photos.newswire.ca/images/download/20140430_C5917_PHOTO_EN_39810.jpg

Image with caption: "Figure 4 - Ground magnetics showing new anomalies at Section 27 target (CNW Group/Nevada Iron Ltd.)". Image available at: http://photos.newswire.ca/images/download/20140430_C5917_PHOTO_EN_39811.jpg

Image with caption: "Figure 5 - Ground magnetics at Section 27 target (CNW Group/Nevada Iron Ltd.)". Image available at: http://photos.newswire.ca/images/download/20140430_C5917_PHOTO_EN_39812.jpg