Ivanhoe Mines Reveals 2023 Financials and Project Updates at BMO Global Metals Conference

Ivanhoe Mines’ (TSX: IVN) (OTCQX: IVPAF) President Marna Cloete and Chief Financial Officer David van Heerden were pleased to present, ahead of the 33rd BMO Global Metals, Mining & Critical Minerals Conference in Hollywood, Florida, the company’s financial results for the year ended December 31, 2023, and provided an operations and project development update.

Ivanhoe Mines is a leading Canadian mining company developing and operating its four principal mining and exploration projects in Southern Africa: expanding operations at the world-class Kamoa-Kakula Copper Complex (Kamoa-Kakula) in the Democratic Republic of Congo (DRC); building the tier-one Platreef palladium, nickel, platinum, rhodium, copper and gold development in South Africa; restarting the historic, ultra-high-grade Kipushi zinc-copper-lead-germanium mine in the DRC; as well as exploring the expansive exploration licences of Ivanhoe’s Western Forelands for copper discoveries adjacent to Kamoa-Kakula. All figures are in U.S. dollars unless otherwise stated.

Ivanhoe Founder and Executive Co-Chairman Robert Friedland commented ahead of delivering his keynote speech at the 33rd BMO Global Metals, Mining & Critical Minerals Conference in Hollywood, Florida, on February 26 at 12:30pm ET:

“Kamoa-Kakula continues to exceed expectations in terms of overall performance, with Phase 1 and 2 mill throughput, copper recoveries and underground mining operations registering strong results in 2023 – and in many cases outperforming nameplate capacity.

Delivering a project of this calibre and scale on budget and ahead of schedule is a true anomaly in the mining industry, which is often plagued by cost overruns and delays.

This track record of success will continue as we ramp-up the Phase 3 concentrator and underground mines significantly ahead of schedule late in the second quarter of 2024 which will position Kamoa-Kakula as the world’s third-largest copper mining complex just eight years after Ivanhoe geologists reported the initial discovery hole at the Kakula deposit.”

“We are working proactively to address power intermittency and expect this to be a short-term issue. Kamoa-Kakula will have full back-up generator redundancy for the Phase 1 and Phase 2 operations in July, and we are well advanced in discussions with our partners in the Democratic Republic of Congo, as well as the government of Zambia, to address the situation permanently, as we bring Phase 3 operations and the smelter complex online.

Kamoa-Kakula will be fully powered by green hydroelectricity over its generationally long life, and we are excited to work with the Congolese government to develop all the infrastructure that will support the world’s newest major copper mining district, which extends onto Ivanhoe’s majority-owned Western Forelands licenses.”

“We are looking forward to another transformative, industry-leading year at Ivanhoe Mines. Seven drill rigs, and counting, are currently turning across the Western Forelands, including expanding the high-grade Kitoko discovery.

Discovering and developing new world-scale copper resources on the Western Forelands represents the highest possible return on capital that Ivanhoe Mines can drive for our shareholders.

Our geology team just drilled a wedge from hole DD008 that re-confirms the extremely significant discovery of sedimentary bonanza-grade copper over 11% grade directly on the Kibaran basement.”

“We are also just a few months away from first production at Kipushi, bringing this legendary mine back to life a century on from when it first produced as the world’s highest-grade open pit copper mine.

At Platreef, we will complete the construction of the proof-of-concept, ‘baby’ Phase 1 mine this year; however, we now have even greater focus on quickly unlocking the Phase 2 expansion of this remarkable resource endowment.

Our team is razor focused on delivering these major milestones for our stakeholders and shareholders, as we take the next vital steps on our journey to emerge as the world’s most dynamic, new major diversified mining company.”

OPERATIONAL HIGHLIGHTS

-The Kamoa-Kakula Copper Complex produced 393,551 tonnes of copper in concentrate in 2023, inside the 2023 production guidance range of 390,000 to 430,000 tonnes. Kamoa-Kakula’s 2023 production achievement represents a year-over-year increase of 18%.

-Production at Kamoa-Kakula for the fourth quarter of 2023 was 92,215 tonnes of copper in concentrate, compared to 103,947 tonnes in Q3 2023 and 92,761 tonnes in Q4 2022.

Quarterly production was impacted by ongoing intermittent grid instability, most acutely in November, with disruptions ongoing in 2024 year-to-date.

The phased roll-out of over 200MW of on-site, backup generation capacity, as well as concurrent grid infrastructure improvements are advancing well.

-During 2023, Kamoa-Kakula Phase 1 and 2 concentrators milled a record of approximately 8.54 million tonnes of ore at an average feed grade of 5.23% copper, producing 824,382 dry metric tonnes of copper concentrate.

-Kamoa-Kakula’s Phase 3 concentrator is now 82% complete and ahead of schedule for first production in late Q2 2024. The Phase 3 smelter complex is now 76% complete and remains on schedule for commissioning in Q4 2024.

The refurbishment of Turbine #5 of the Inga II hydropower dam is 60% complete and on schedule for commissioning in Q4 2024. Concentrate production from the early commissioning of Phase 3 will be partially stockpiled in anticipation of smelter commissioning.

-With the anticipated early commissioning of Phase 3, full-year production guidance for Kamoa-Kakula was announced on January 8, 2024, at 440,000 to 490,000 tonnes of copper in concentrate.

-Ivanhoe announces “Project 95” at Kamoa-Kakula – an initiative targeting an increase of copper recoveries to 95% by liberating copper from the tailings stream at the concentrator, as well as re-treatment of tailings deposited to date. Basic engineering for Project 95 is underway and is expected to be complete in early Q2 2024.

-Kamoa-Kakula commenced trial exports of concentrate along the Lobito Atlantic Railway Corridor in late 2023. More recently, Kamoa-Kakula has signed a term sheet outlining the key terms for a Reserved Capacity Agreement for the transportation of up to 240,000 tonnes of copper products along the Lobito Corridor from 2025. As such, Kamoa-Kakula will be the first industrial customer of the Lobito Corridor in the modern era.

-Industry peer data compiled by Skarn Associates ranks the Kamoa-Kakula Copper Complex comfortably within the bottom decile of the greenhouse gas (GHG) emissions intensities on a Scope 1, 2 and 3 (partial) basis.

Following the completion of the Phase 3 expansion and the smelter, the emissions intensity of Kamoa-Kakula on a Scope 1, 2 and 3 basis is estimated to almost halve to 1.31 tonnes of carbon dioxide equivalent per tonne (t CO₂-e / t Cu) of copper produced.

-In the Western Forelands, Ivanhoe announced on November 28, 2023, the geologically significant, high-grade Kitoko copper discovery on a new joint venture licence, as well as the maiden Mineral Resource estimates for the Makoko and Kiala high-grade copper discoveries, as announced on November 13, 2023.

-Ivanhoe’s exploration budget for 2024 has quadrupled to approximately $90 million, with exploration activities primarily focused on the 2,654-square-kilometre Western Forelands Exploration Project, including the expansion of the Kitoko discovery. Seven drill rigs are currently active, with two more arriving by quarter-end.

-At Kipushi, construction of the 800,000 tonnes-per-annum concentrator is approximately 85% complete and ahead of schedule for commissioning in Q2 2024.

Mining of the ultra-high-grade Big Zinc orebody has commenced ahead of schedule. Approximately, 220,000 tonnes of lower-grade ore from development is stockpiled on surface at an average grade of 22% zinc, including approximately 30,000 tonnes of “medium-grade” at 30% zinc.

-Ivanhoe Mines and Gécamines signed a revised joint venture to restart the ultra-high-grade Kipushi mine. Terms are unchanged from when initially announced on February 14, 2022.

-At Platreef, an updated independent feasibility study (FS) is planned for the second half of 2024 on an optimized development plan for Phase 2.

The optimized development plan accelerates the development of Phase 2 at a total processing capacity of 4 million-tonnes-per-annum (Mtpa) by equipping Shaft #3 for hoisting.

-Construction activities for the Platreef Phase 1 concentrator are on track for completion in Q3 2024. Hot commissioning and ramp-up of production are now planned to be deferred until early 2025.

This decision was taken to prioritize the increased underground development, including critical-path Shaft #3 and Shaft #2 raise-boring, while hoisting capacity is constrained to Shaft #1 only.

-An independent preliminary economic assessment (PEA) is planned concurrently with the FS on a significantly larger Phase 3 expansion, once the major 8 Mtpa Shaft #2 is available for hoisting.

A Phase 3 expansion to 10 Mtpa processing capacity is expected to rank Platreef as one of the world’s largest platinum-group metal, nickel, copper and gold producers.

-Ivanplats has signed a Purchase of Concentrate Agreement with Sibanye-Stillwater for Phase 2 concentrate. The agreement is for 8 years from first production and is for an initial annual volume of 60,000 tonnes of concentrate, approximately one-third of anticipated Phase 2 volume.