Ivanhoe Electric tables initial assessment for U.S. copper mine

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Ivanhoe Electric Inc. [IE-TSX, NYSE American] has announced the completion of an initial assessment (IA) for the company’s undeveloped Santa Cruz copper project in Arizona.

“Our goal is to develop a modern copper mine that produces copper with among the lowest levels of carbon dioxide output in the industry, a product we think has the potential to attract a premium price in the future,’’ the company said in a press release.

The IA is a preliminary technical and economic study focusing on the potential for a high grade 15,000 tonne-per-day underground oxide copper mining operation (to be largely powered by renewable energy).

The IA envisions an underground operation producing 50,000 tonnes per year of cathode copper over a 20-year initial mine life based on a life-of-mine average grade of 1.58% copper and a cash cost of US$1.36 a pound

The initial capital expenditure is estimated at US$1.15 billion followed by a life of mine sustaining capital expenditure of 988 million.

There is the potential for future growth with additional resources from the Texaco Deposit (not included in the IA) and the deeper sulfide resources at Santa Cruz.

Details of the IA were released after the close of trading on September 5, 2023 when Ivanhoe Electric shares were priced at $21.74. The shares are currently trading in a 52-week range of $22.65 and $10.70.

Ivanhoe Electric is headed by billionaire mining magnate Robert Friedland. His previous endeavours include nickel discoveries in the Voisey’s Bay area of Newfoundland and Labrador and more recently copper mining operations in Mongolia and the Democratic Republic of Congo (DRC). The DRC assets are held by Ivanhoe Mines Ltd. [IVN-TSX, IVPAF-OTC].

Friedland is Executive Chairman of Ivanhoe Electric, which is led by President and CEO Taylor Melvin.

On June 30, 2022, Ivanhoe Electric closed an IPO that raised US$169.1 million from the sale of 14.4 million shares, priced at US$11.75 per share.

Ivanhoe Electric used the proceeds of the IPO to fund certain payments to acquire or maintain its mineral property rights, fund metals exploration and construct and deploy additional sets of its Typhoon electrical pulse-powered geophysical surveying transmitter technology.

The aim is to develop mineral deposits in the U.S. in order to support American supply chain independence and to deliver critical metals needed for electrification of the economy.

“We believe the United States is significantly underexplored and has the potential to yield major new discoveries of these metals,’’ the company said in a regulatory document filed with the U.S. Securities and Exchange Commission.

The company’s flagship properties are the Santa Cruz Copper project in Arizona and the Tintic Copper-Gold project in Utah.  “Santa Cruz is situated in a prolific mining region that hosts some of the largest copper mines in the United States,’’ the company said.

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