Ivanhoe Mines releases positive Kamoa PFS

Inspection of the Nzilo 1 dam, one of three hydro-power plants – Koni, Mwadingusha and Nzilo 1 – in the DRC that are being upgraded to secure a long-term, clean, sustainable power supply to meet the requirements of Kamoa’s planned mine and smelter development. The upgrading work is being led by Stuck Ltd., of Switzerland. Source: Ivanhoe Mines Ltd.

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Robert Friedland, Executive Chairman, Ivanhoe Mines Ltd. [IVN-TSX; IVPAF-OTC] has released an independent Prefeasibility Study for the first phase of development of the Kamoa copper project in the Democratic Republic of the Congo.

The Kamoa copper project — a joint venture between Ivanhoe Mines and Zijin Mining Group Co. Ltd. — has been independently ranked as the world’s largest, undeveloped, high-grade copper discovery by international mining consultant Wood Mackenzie.

The Kamoa 2016 PFS was independently prepared by OreWin Pty. Ltd., Amec Foster Wheeler E&C Services Inc. and SRK Consulting Inc. The report reflects the initial phase of project development, and describes the construction and operation of a 3 million-tonne-per-annum (Mtpa) underground mine, concentrator processing facility and associated infrastructure. The first phase of mining would target high-grade copper mineralization from shallow, underground resources to yield a high-value concentrate. The planned second phase would entail a major expansion of the mine and mill, and construction of a smelter to produce blister copper.

The Kamoa 2016 PFS includes an economic analysis that is based on probable mineral reserves. A National Instrument 43-101 technical report will be filed on SEDAR and on Ivanhoe’s website within 45 days of the issuance of this news release.

Highlights of the Kamoa 2016 PFS:

  • Annual mine production of three Mtpa at an average grade of 3.86% copper over a 24-year mine life, resulting in annual copper production of approximately 100,000 tonnes;
  • Initial capital cost, including contingency, is US $1.2-billion, approximately US $200-million lower than estimated in the Kamoa 2013 PEA;
  • Life-of-mine average mine site cash cost is US 75 cents/pound of copper;
  • Aftertax net present value at an 8% discount rate of US $986 million;
  • Aftertax internal rate of return of 17.2% and a payback period of 4.6 years;
  • High-grade copper concentrate with an average grade of 39.2% copper and very low arsenic levels;

Improvements to the mining method have the potential to reduce average mine site cash cost during the first phase to US 61 cents/pound of copper, and improve the aftertax net present value at an 8% discount rate to US $1,182-million, the internal rate of return to 18.9% and the payback period to 4.3 years.

“The results of this independent prefeasibility study confirm the robustness of the Kamoa copper project over a wide range of copper prices, with the potential for significant improvement in the results as we move forward on the feasibility study,” said Mr. Friedland.

“We know of no other copper project in the world that offers the potential of multidecade, large-scale, mechanized production from a near-surface, stratiform deposit grading nearly 4% copper, with the demonstrated potential for further high-grade discoveries nearby and located close to a major mining centre.

“With the support of our partners — including our joint venture partner, Zijin Mining, our employees, local entrepreneurs and community members, and the DRC government — we are looking forward to building a major new, safe, mechanized copper mine on the western edge of the DRC’s famous copper belt.”

The Kamoa copper deposit was discovered by Ivanhoe Mines in 2008.

Inspection of the Nzilo 1 dam, one of three hydro-power plants – Koni, Mwadingusha and Nzilo 1 – in the DRC that are being upgraded to secure a long-term, clean, sustainable power supply to meet the requirements of Kamoa’s planned mine and smelter development. The upgrading work is being led by Stuck Ltd., of Switzerland. Source: Ivanhoe Mines Ltd.
Inspection of the Nzilo 1 dam, one of three hydro-power plants – Koni, Mwadingusha and Nzilo 1 – in the DRC that are being upgraded to secure a long-term, clean, sustainable power supply to meet the requirements of Kamoa’s planned mine and smelter development. The upgrading work is being led by Stuck Ltd., of Switzerland. Source: Ivanhoe Mines Ltd.

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