Ivanhoe Mines Ltd. Class A · TSX:IVN
Ivanhoe Mines Ltd. Class A — Investor Presentation (December 2023)
39 slides from Ivanhoe Mines Ltd. Class A's investor presentation, Dec 7, 2023
Slide 1: Investor Presentation
INVESTOR PRESENTATION December 2023 TSX: IVN | OTCQX: IVPAF
Slide 2: Disclaimer and Forward-Looking Statements
DISCLAIMER AND FORWARD-LOOKING STATEMENTS The information contained in this presentation and other information furnished by or on behalf of Ivanhoe Mines Ltd. (“Ivanhoe”) is confidential and has been prepared to assist the recipients hereof in conducting their own evaluation of Ivanhoe and does not
Slide 3: Ivanhoe at a Glance
IVANHOE AT A GLANCE CORPORATE INFORMATION TSX: IVN LISTINGS OTCQX: IVPAF SHARE PRICE C$12.28 / share(1) MARKET CAP US$10.9 billion(1) SHARES, OPTIONS, Common Shares: 1,220.6 million(2) RSUs & DSUs Options, RSUs & DSUs: 17.7 million(2) CASH POSITION US$303 million(3) DEBT OUTSTANDING US$715 million(4
Slide 4: A Leading Producer, Developer and Explorer in Africa
A LEADING PRODUCER, DEVELOPER AND EXPLORER IN AFRICA World’s fastest growing major copper mine with the highest grades World’s highest-grade zinc project OWNERSHIP: OWNERSHIP: KAMOA-KAKULA KIPUSHI Ivanhoe Mines (39.6%) Ivanhoe Mines (62%) Zijin Mining Group (39.6%) Gécamines (38%) Government of DRC
Slide 5: The World's Next Diversified Major Miner
THE WORLD’S NEXT DIVERSIFIED MAJOR MINER Ivanhoe will be a responsible, leading supplier of critical metals for the clean-energy transition, including copper, nickel, zinc and PGMs. IN PRODUCTION FIRST PRODUCTION Q3 2024 FIRST PRODUCTION Q3 2024 EXPLORATION KAMOA-KAKULA PLATREEF KIPUSHI WESTERN FORE
Slide 6: DRC: Awakening a Copper Giant
DRC: AWAKENING A COPPER GIANT Recently became the joint 2nd As the host country, and as a largest global copper producer shareholder of Kamoa Copper, the DRC sees this local value creation Abundant hydro-power capacity as a strategic imperative Median population age of 17 His Excellency Félix Tshise
Slide 7: Kamoa-Kakula
KAMOA-KAKULA The World’s fastest-growing, highest-grade, lowest-carbon major copper mine 7
Slide 8: Ivanhoe Mines' Kamoa-Kakula Copper Complex
IVANHOE MINES’ KAMOA-KAKULA COPPER COMPLEX The world’s fastest growing, highest grade, lowest-carbon, major copper mine Democratic Republic of the Congo is the world’s 3rd largest copper producer Mechanised underground mine; employing safe, modern mining methods Set to be world’s third largest coppe
Slide 9: Stakeholders Shared Value and Local Partnership
STAKEHOLDERS SHARED VALUE AND LOCAL PARTNERSHIP $2.8M INVESTED IN LOCAL BUSINESSES 20% OWNERSHIP Development of infrastructure and provision of DRC government direct farming and aquaculture inputs project shareholding >$40M IN COMMUNITY SPEND Kamoa-Kakula's total social and community development con
Slide 10: Kamoa-Kakula: Record Q3 Quarterly Production
KAMOA-KAKULA: RECORD Q3 QUARTERLY PRODUCTION (Figures shown on 100% basis for Kamoa-Kakula) De-bottlenecking program completed Ore tonnes milled (‘000’s tonnes) / ahead of schedule in Q1 2023. Phase 1 Copper ore grade processed (%) and 2 production capacity increased to 5.40% 5.42% 5.21% 5.37% ~450k
Slide 11: Kamoa-Kakula: Quarterly Performance
KAMOA-KAKULA: QUARTERLY PERFORMANCE (Figures shown on 100% basis for Kamoa-Kakula) Copper sold and revenue lower in Q3 2023, offset by slightly higher copper prices Quarterly Revenue(1) (US$ million) Copper Sold (kt) / Realized Copper Price (US$/lb.) $4.04/lb. $3.79/lb. $3.84/lb. $3.54/lb. 101.5 96.
Slide 12: Kamoa-Kakula: Cash Costs Maintained in Q3 2023
KAMOA-KAKULA: CASH COSTS MAINTAINED IN Q3 2023 (Figures shown on 100% basis for Kamoa-Kakula) C1 cash costs within FY 2023 guidance ($1.40 - $1.50/lb.) Cash costs year to date at $1.43/lb. below mid-point of guidance C1 Cash Cost (US$ per lb.) EBITDA(1) (US$ million) / EBITDA Margin (%) 67% 66% 65%
Slide 13: High Grade Copper = Unrivaled Capital Returns
HIGH GRADE COPPER = UNRIVALED CAPITAL RETURNS US$3.3 billion of EBITDA US$ million Quarterly EBITDA generated in 2¼ years; significantly higher than 423 Phase 1 and 2 Capex of US$2.0 billion 457 457 Phase 3 and subsequent expansions to be funded 452 from cashflows generated 700 by operations 251 286
Slide 14: Key Highlights: Kamoa-Kakula IDP 2023
KEY HIGHLIGHTS: KAMOA-KAKULA IDP 2023 (Figures shown on 100% basis for Kamoa-Kakula) 2023 PFS 2023 PEA Mine Life 33 Years 42 Years Total Ore Milled 476 Mt 657 Mt Feed Grade 3.94% 3.70% Total Copper in Concentrate 16 Mt 21 Mt Mill Feed Grade (10 year average) 4.94% Copper in Concentrate (10 year aver
Slide 15: Kamoa-Kakula 2023 Integrated Development Plan
KAMOA-KAKULA 2023 INTEGRATED DEVELOPMENT PLAN Four-stage ramp up to 19.2 Mtpa processing capacity 20.0 Phase 4 (2030) 6.0 18.0 Kamoa 2 Phase 3 5.0 16.0 (Q4 2024) Kansoko Sud PEA only 14.0 Kamoa 3 - 6 4.0 Grade (% Cu) 12.0 Milled (Mt) Kamoa Kamoa 1 10.0 Stockpile 3.0 8.0 Kakula 2.0 6.0 Stockpile Kaku
Slide 16: Kamoa-Kakula: The World's Best Copper Mine
KAMOA-KAKULA: THE WORLD’S BEST COPPER MINE World’s projected top 20 copper mines in 2025, by key metrics 6.0% Bubble size: M&I Resource Kamoa-Kakula Copper Head Grade (%) 5.0% Kamoto 4.0% 3.0% Polish Copper 2.0% Oyu Tolgoi Grasberg Kansanshi Escondida 1.0% Collahuasi 0.0% 0 200 400 600 800 1,000 1,2
Slide 17: 500,000tpa Smelter Brings Transformative Benefits
500,000TPA SMELTER BRINGS TRANSFORMATIVE BENEFITS Aerial view of the Phase 1 and 2 concentrator, overlaid with a 3D rendering of the adjacent smelter complex, which is currently under construction $906 million estimated capital cost for the massive, 100-hectare site 500,000 tonnes of 99+% pure blist
Slide 18: Kamoa-Kakula YTD C1 Cash Costs Within Guidance
KAMOA-KAKULA YTD C1 CASH COSTS WITHIN GUIDANCE (Figures shown on 100% basis for Kamoa-Kakula) $4.50 $4.00 Q4 2024 completion of Phase 3 direct-to-blister smelter C1 Cash Cost (US$/lb.) to drive cash cost improvement to the first quartile $3.50 $3.00 $2.50 $2.00 < $1.20/lb. target YTD C1 Cash Cost: (
Slide 19: Kamoa-Kakula Phase 3 Expansion: Completion in H2 2024
KAMOA-KAKULA PHASE 3 EXPANSION: COMPLETION IN H2 2024 Phase 3 expansion consists of 5Mtpa concentrator, copper smelter and refurbishment of turbine #5 Phase 3 concentrator 62% complete and ahead of schedule for Q3 2024 completion; total of 1,980 of truck deliveries have already arrived and been offl
Slide 20: Trial Copper Shipments on Lobito Corridor in Q4 2023
TRIAL COPPER SHIPMENTS ON LOBITO CORRIDOR IN Q4 2023 Rail to Lobito 1,739 km Dar es Salaam G7 and EU join the US investment partnership Roundtrip: ~20 days to accelerate the development of Lobito KAMOA-KAKULA Railway Corridor 2,466 km Lobito Roundtrip: ~40 days Corridor is a significantly lower carb
Slide 21: Western Foreland Exploration, DRC
WESTERN FORELAND EXPLORATION, DRC 2,654 km2 highly prospective licence package containing the high-grade Makoko and Kiala copper deposits, plus Kitoko copper discovery ~US$70 million 2024 exploration budget to focus on testing extents of Makoko, Kiala, Kitoko discoveries, plus testing additional new
Slide 22: Western Foreland: Makoko & Kiala
WESTERN FORELAND: MAKOKO & KIALA Maiden Mineral Resource released on Makoko & Kiala; 30.0 4.0 Contained Copper in Resources (Mt) world’s fourth-largest copper discovery in past decade Contained, M&I Copper Grade in Resources (%) 25.0 Contained, Inferred Makoko Indicated Mineral Resource of 16Mt at 3
Slide 23: Western Foreland: Kitoko Discovery
WESTERN FORELAND: KITOKO DISCOVERY Kitoko is Ivanhoe’s fifth high-grade Core from Kitoko discovery hole DD008, highlighting two sedimentary copper discovery in the DRC layers of high-grade mineralization New discovery traced over a 1.9-kilometre strike and open in all directions Mineralogical charac
Slide 24: Kitoko: Newly Discovered Copper Horizon
KITOKO: NEWLY DISCOVERED COPPER HORIZON 24
Slide 25: Platreef
PLATREEF World’s largest precious metals development project 25
Slide 26: Platreef: World's Largest Undeveloped Precious Metals Project
PLATREEF: WORLD’S LARGEST UNDEVELOPED PRECIOUS METALS PROJECT Multi-generational resource with significant exploration upside World’s best PGM project: highest margin and lowest cash costs Industry disruptor – safe, mechanized and highly productive mining Target to become the largest PGM mine; phase
Slide 27: Platreef: What Makes the Flatreef Unique?
PLATREEF: WHAT MAKES THE FLATREEF UNIQUE? 29 meters By way of visual comparison Khomanani Mine, Rustenburg Shaft 1 headframe, Platreef Deposit Merensky Reef / UG2 Flatreef(1) Bushveld Location Western / Eastern Limb Northern Limb Underground: narrow-reef, manual, Underground: efficient mechanised, M
Slide 28: Platreef: Shaft 2 Construction
PLATREEF: SHAFT 2 CONSTRUCTION 79-metre high continuously-poured concrete base of Shaft 2 complete, top 20 metres of steel to follow; once complete totaling ~100-metre-high headframe Installation of structural steel inside Platreef’s Shaft 2 concrete headframe has commenced Pilot-hole drilling of Sh
Slide 29: Platreef: Optimization of Shaft 3 in Progress
PLATREEF: OPTIMIZATION OF SHAFT 3 IN PROGRESS Reaming of 5.1-metre-diameter Shaft 3 targeted for completion in Q4 2023; equipped and ready to hoist in 2025 Optimization work underway to accelerate Phase 2 expansion by installing hoisting capacity in Shaft 3 Inspection of the recently completed under
Slide 30: Platreef: Potential to Become Among the World's Largest Primary PGM Producers
PLATREEF: POTENTIAL TO BECOME AMONG THE WORLD’S LARGEST PRIMARY PGM PRODUCERS Platreef 2014 PEA 3PE+Au Production 2019 (Pd Eq. oz) (LoM Average) 1,600 3PE+Au Production Palladium Equivalent Production (koz) 1,400 Ni+Cu Production Ni+Cu Production 2019 (Pd Eq. oz) Platreef 1,200 2022 FS (Phase 2) 1,0
Slide 31: Platreef: Industry Leading Cash Cost
PLATREEF: INDUSTRY LEADING CASH COST Global primary PGM producer net total cash cost + sustaining capital (2021), US$/3PE+Au oz Quartile 1 Quartile 2 Quartile 3 Quartile 4 1,800 1,600 Platreef 2022 FS 1,400 cash cost: US$514/oz 3PE+Au 1,200 US$/3PE+Au 1,000 800 600 400 200 0 Western Limb Eastern Lim
Slide 32: Key Highlights: February 2022 FS
KEY HIGHLIGHTS: FEBRUARY 2022 FS Shown on 100%-basis in US$ 2022 FS (Phase 1 → 2) Annual Throughput 0.7Mt → 5.2Mt Annual 3PE+Au 113koz → 591koz Annual Ni + Cu 8Mlb → 42Mlb Total Cash Costs (LOM) (1) $514/oz 3PE+Au Initial / Expansion Capital $0.5 Bn / $1.5 Bn LONG- After-tax NPV8%(2) $1.7 Bn TERM PR
Slide 33: Kipushi
KIPUSHI World’s highest-grade, lowest-carbon major zinc mine
Slide 34: Kipushi: Historic, Ultra-High-Grade Zinc Deposit
KIPUSHI: HISTORIC, ULTRA-HIGH-GRADE ZINC DEPOSIT World’s top 10 major zinc mines (ranked by 2020 production) Brownfield, ultra-high-grade zinc mine with significant, rehabilitated 600 35 underground infrastructure Contained Zinc Production (kt) Contained zinc production (kt) 500 30 Ore milled head g
Slide 35: Kipushi: Ahead of Schedule for Q2 2024
KIPUSHI: AHEAD OF SCHEDULE FOR Q2 2024 New 800,000 tonnes-per-annum concentrator over 67% complete, expected in Q2 2024 Stoping (mining) of Kipushi’s ultra-high-grade Big Zinc orebody to commence within a month Underground development ~20% ahead of schedule, Aerial view of the Kipushi with 2,744 met
Slide 36: Kipushi: Strategic Partnership with Gecamines
KIPUSHI: STRATEGIC PARTNERSHIP WITH GECAMINES Agreement advancing for a new commercial DRC-Zambia border-crossing at Kipushi New border will benefit both the Kipushi Mine and Kamoa-Kakula as an additional route for exporting products from DRC Trucks fully-loaded with concentrate preparing to leave f
Slide 37: Investment Highlights
29 Cu Three long-life, world-class Robust, experienced Committed support from key Strong balance sheet with 2023 production guidance mines with low costs, low management team with an partners CITIC and Zijin cash & cash equivalents of of 390kt to 430kt of copper capital intensity and established tra
Slide 38: Strong Balance Sheet Supports Growth Projects
STRONG BALANCE SHEET SUPPORTS GROWTH PROJECTS (Figures shown on 100% basis, US$ millions) YTD Ivanhoe Mines cash and cash Capital 2023 FY Capex 2024 FY Capex Funding Capex equivalents of $303 million Expenditure Guidance Guidance Arrangements Spent Kamoa-Kakula JV cash flow Phase 2, 3 & Kamoa-Kakula
Slide 39: Significant Cash Flow Attributable to Ivanhoe
SIGNIFICANT CASH FLOW ATTRIBUTABLE TO IVANHOE Sept 30, 2023 Shareholder Loan Balances ($ million) Kamoa-Kakula (39.6% equity interest) Total shareholder loans payable by Kamoa Holding $3,404 Ivanhoe will receive Portion of shareholder loan receivable by Ivanhoe $1,686 distributions (once Percentage
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