Champion Signs Agreement with CN for Feasibility Study for Railway from Labrador Trough to Sept-Iles

TORONTO, ONTARIO -- (Marketwire) -- 08/29/12 -- CHAMPION IRON MINES LIMITED (formerly CHAMPION MINERALS INC.) (TSX: CHM)(OTCQX: CPMNF)(FRANKFURT: P02) ("Champion" or the "Company") is pleased to announce the signing of an agreement with Canadian National Railway Company ("CN") to participate in the feasibility study of a proposed new multi-user railway that would connect mining projects in the Labrador Trough to the deep water port of Sept-Iles, Quebec. CN's partner in this proposed venture is La Caisse de depot et placement du Quebec which, together with a group of iron ore exploration and mining companies, including Champion, are contributing to the cost of the feasibility study.

CN is expeditiously coordinating the application to the Canadian Environmental Assessment Agency for required permitting, which will allow the study to commence with appropriate consultation with First Nations, local communities and other stakeholders.

"The development of a new railway in the Labrador Trough, linking Champion's Fermont Iron Ore Holdings, including its flagship Fire Lake North Project, is of significant interest. It could provide long-term rail capacity with an experienced and established carrier, linking the Company's projects to the new multi-user deep water port where annual ship-loading capacity for a minimum of 10 million tonnes of iron ore concentrate has been secured by Champion," stated Thomas Larsen, Champion's President and CEO. "We look forward to the completion of this study, which will enable Champion to assess this long-term transportation option, a key developmental milestone to complement the feasibility study for Fire Lake North which is well underway."

Under the terms of the agreement with CN, Champion has committed to contribute $1 million to the feasibility study on the railway, that is anticipated to be carried out over the next ten months.

About Champion Iron Mines Limited

Champion is an iron exploration and development company with offices in Montreal and Toronto, and is focused on developing its significant iron resources in the provinces of Quebec and Newfoundland & Labrador. Champion holds a 100% interest in the Fermont Iron Holdings and a 44% interest in the Attikamagen Iron Project located in both Quebec and Labrador.

Champion's Fermont Iron Holdings, including the flagship Fire Lake North Project, are located in Canada's major iron ore producing district, in close proximity to five producing iron mines. Fire Lake North is located immediately adjacent to and north of ArcelorMittal's operating Fire Lake Mine and 60 km south of Cliffs Natural Resources Inc.'s Bloom Lake Mine in northeastern Quebec. Champion's team and advisory board includes mining and exploration professionals with the mine operations experience to build the Fire Lake North Project into a producing mine.

For additional information on Champion, please visit our website at www.championironmines.com.

This news release includes certain information that may constitute "forward-looking information" under applicable Canadian securities legislation. Forward-looking information includes, but is not limited to, statements about mineral resource estimates and planned operations at the Company's projects, including its Fire Lake North Project. Forward-looking information is necessarily based upon a number of estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information, including the risks identified in Champion's annual information forms, management discussion and analysis and other securities regulatory filings by Champion on SEDAR (including under the heading "Risk Factors" therein). There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking information. Accordingly, readers should not place undue reliance on forward-looking information. All forward-looking information contained in this press release is given as of the date hereof and is based upon the opinions and estimates of Champion's management and information available to management as at the date hereof. Champion disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.

This press release has been prepared by Champion Iron Mines Limited and no regulatory authority has approved or disapproved the information contained herein.

Contacts:

Champion Iron Mines Limited

Thomas G. Larsen

President and CEO

(416) 866-2200


Champion Iron Mines Limited

Jorge Estepa

Vice President

(416) 866-2200
www.championironmines.com