| KOLWEZI, DEMOCRATIC REPUBLIC OF CONGO |“The company is fully focused on bringing the Kakula Copper Mine to production on schedule and on budget. The extraordinary protective measures that we put in place to safeguard the health and safety of our employees and contractors have enabled our outstanding multi-national mining team to repeatedly set new underground development records. This accomplishment positions us to deliver a world-class copper mine fortuitously timed for the highly probable recovery of the world economy by the third quarter of 2021.”
Founder, Executive Co-Chairman and Non-Independent Director
Ivanhoe Mines Ltd
Ivanhoe Mines Co-Chairs Robert Friedland and Yufeng “Miles” Sun recently announced that
underground development at the Kakula Copper Mine is continuing to advance ahead of schedule and that more than 13.5 kilometres of underground development is now completed, which is 4.2 kilometres ahead of plan. This month, the mining team is on pace to set a new monthly development record of 1.7 kilometres of advancement ─ 562 metres ahead of plan for the month.
While Ivanhoe Mines is in a strong financial position going into this period of global uncertainty with cash and cash equivalents of US$603 million at the end of March and no significant debt, the company has identified several cost-reduction initiatives to generate cash savings of up to US$75 million through 2021. The savings will be generated through reducing discretionary spending at the company’s projects, lowering general and administrative costs and corporate overheads, voluntary salary reduction for senior management and deferral of certain exploration activities previously planned for 2020 and will be fully directed towards developing the company’s flagship Kakula Copper Mine to commercial production on schedule and on budget.
Kamoa-Kakula Project progress update
At the Kamoa-Kakula Project in the Democratic Republic of Congo (DRC), the first phase
of development at the Kakula Copper Mine is in many respects exceeding the published
plans. Crews now are mining and stockpiling development ore with an average grade greater than 8% copper. Almost all the underground development is in ore and, as a result, each blast in Kakula’s high-grade mining zone produces approximately 550 tonnes of ore, which is transported to a dedicated, high-grade pre-production surface stockpile.
Kakula’s high-grade ore stockpile is expected to total approximately 1.5 million tonnes prior to the start of initial production. Underground development at Kakula is 4.2 kilometres ahead of plan. More than 13.5 kilometres of underground development is now complete, against the original plan of 9.3 kilometres. The outstanding mining team has again broken the record of the previous 30 days and is on pace to set its third consecutive monthly development record with 1.7 kilometres of advancement in April ─ 560 metres ahead of plan.
Approximately 29.5 kilometres of underground development is scheduled for the remainder of 2020 and 2021 until scheduled first concentrate production.
In parallel with the construction of Kamoa-Kakula’s phase 1 Kakula Mine, the independent Kakula definitive feasibility study (DFS) and an updated Integrated Development Plan for the entire Kamoa-Kakula mining complex also remain on schedule for Q3 2020. The Kakula DFS will provide a high level of accuracy for the project economics for Kakula’s initial phase of mine development, as most construction contracts and orders for significant capital items have been placed at fixed prices. The Integrated Development Plan will include details on the planned expansion phases for the greater Kamoa-Kakula mining complex; incorporating updates for mineral resources, production rates and economic analysis.
Mr. Friedland commented, “The company is fully focused on bringing the Kakula Copper Mine to production on schedule and on budget. The extraordinary protective measures that we put in place to safeguard the health and safety of our employees and contractors have enabled our outstanding multi-national mining team to repeatedly set new underground development records. This accomplishment positions us to deliver a world-class copper mine fortuitously timed for the highly probable recovery of the world economy by the third quarter of 2021.”
Mr. Sun added, “We’re not just investing in a new mine, roads, hydro-power plants, power lines and other important infrastructure, we’re investing in good-paying jobs and new opportunities for people who live in the DRC.”