Ivanhoe Mines Ltd. Class A · TSX:IVN
Ivanhoe Mines Ltd. Class A — Investor Presentation (June 2018)
53 slides from Ivanhoe Mines Ltd. Class A's investor presentation, Jun 27, 2018
Slide 1: June 2018
June 2018
Slide 2: Forward-looking statements & Qualified Person
Forward-looking statements & Qualified Person Certain statements in presentation constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws, including, without limitation, the timing and results of: (i) statements regarding the ongoing d
Slide 3: Kamoa-Kakula, Platreef, Kipushi
KAMOA-KAKULA Initial development of two mining areas on world’s 4th-largest copper discovery Democratic Republic of Congo’s Central African Copperbelt PLATREEF KIPUSHI Ultra-high-grade Mine projected to be historic mine being Africa’s lowest-cost producer upgraded to produce of platinum-group metals
Slide 4: Ivanhoe Mines and CITIC Metal sign strategic cooperation and investment agreement
June 11, 2018: Ivanhoe Mines and CITIC Metal signed a long-term strategic cooperation and investment agreement that will see CITIC invest approximately C$723 (US$560) million to help advance three world-scale mine-development projects in Southern Africa. CITIC and Ivanhoe have shared a long-standing
Slide 5: Ivanhoe and CITIC long-term strategic cooperation and investment agreement
Ivanhoe and CITIC long-term strategic cooperation and investment agreement • CITIC Metal to invest C$723 million (US$560 million) to help advance Ivanhoe’s three world-scale mine-development projects. • CITIC Metal to acquire 19.9% stake in Ivanhoe Mines. • Ivanhoe will issue 196.6 million common sh
Slide 6: CITIC has the financial resources to help Ivanhoe advance its three projects
CITIC has the financial resources to help Ivanhoe advance its three projects to production "We are confident that CITIC Metal shares our vision and has the experience and financial resources to help us advance our three projects to production, creating value for Ivanhoe’s stakeholders in the Democra
Slide 7: Former South African President Kgalema Motlanthe appointed non-executive director
April 10, 2018: Former South African President Kgalema Motlanthe appointed non-executive director of Ivanhoe “Mr. Motlanthe is widely recognized as one of the African continent’s wise men. We are honoured to be able to welcome to our board an individual with such respected credentials in the interna
Slide 8: Platreef discovery & mine development
Platreef discovery & mine development South Africa
Slide 9: Shaft 1 reached depth of more than 750 metres
April 23, 2018: Shaft 1 reached a depth of more than 750 metres below surface. Construction of the station underway at the 750-metre-level will provide initial mine development access to the orebody. Development work focused on initial production by early 2022. 9
Slide 10: Platreef shaft-sinking team with cactus grab on 750-metre level
Members of Ivanhoe’s Platreef shaft-sinking team with a “cactus grab” used to remove excavated rock from lateral mine development on the 750-metre level of Shaft 1 10
Slide 11: Ivanhoe secured long-term supply of treated bulk water
May 2018: Ivanhoe Mines secured long-term supply of treated bulk water to process ore Agreement provides a minimum of five million litres of treated water a day for 32 years, beginning in 2022, from the town of Mokopane’s new Masodi Treatment Works. Recycling of local, treated water is part of a sus
Slide 12: Construction of surface box-cut for Shaft 2 headframe
Construction of the surface box-cut for the main production shaft (Shaft 2) headframe 12
Slide 13: Shaft 2 concrete headframe and hoisting facilities illustration
Illustration shows two cut-away perspectives of Shaft 2’s 103-metre-tall concrete headframe and internal permanent hoisting facilities. 13
Slide 14: Definitive feasibility study issued for Platreef Project
July 31, 2017: Definitive feasibility study issued for Platreef Project First phase envisages annual throughput rate of four million tonnes of ore per year, producing 476,000 ounces of platinum, palladium, rhodium and gold (3PE+Au), plus 33 million pounds of nickel and copper. Projected to be Af
Slide 15: Platreef cash cost at bottom of world cash-cost curve
Platreef’s potential US$351 per 3PE+Au ounce (net of base-metal by-products) at the bottom of the world’s cash-cost curve $1,600 $1,400 $1,200 Ivanhoe’s Platreef Project at the bottom $1,000 of the cash-cost curve. $800 $600 $400 $200 $0 3PE+Au oz production Platreef 4Mtpa FS Northern limb Zimbabwe
Slide 16: Platreef would be world's largest platinum-group metals mine
At 12 million tonnes of ore per year, Platreef would be the world’s largest platinum-group metals mine 1,400 Platreef Phase 3 (12 Mtpa) Ni + Cu + Cr production (eq. Pt oz) 1,200 Ir + Ru production (eq. Pt oz) 1,000 Platreef Phase 2 (8 Mtpa) 4E production (eq. Pt oz) 800 Platreef Phase 1 (4 Mtpa) 600
Slide 17: Platreef Project financing progressing
Platreef Project Financing Progressing: German, Swedish and Canadian government institutions are arranging debt financing for Platreef. Expressions of interest received for approximately US$900 million of a US$1 billion finance package. 17
Slide 18: Platreef's B-BBEE partnership a top performer
Platreef's B-BBEE partnership a top performer in South Africa’s platinum sector Platreef 26% ownership stake by Black Economic Empowerment (BBE) partners is one of the broadest empowerment transactions ever settled in South African mining. • 20% held by a trust to benefit 20 local host communities,
Slide 19: Platreef apprenticeship program at shaft-sinking training academy
Members of Platreef's apprenticeship program receive job knowledge and skills instruction at Murray & Roberts' shaft-sinking training academy 19
Slide 20: The future of underground mining is automation
The future of underground mining is automation Ivanhoe’s Platreef Platinum Project in South Africa is ideally suited for mechanized, autonomous mining. Source: MINEX Forum Source: GeoDrilling International 20
Slide 21: The looming platinum supply cliff
The looming platinum “supply cliff” for Southern Africa’s existing producing mines (’000 oz.) Southern Africa's projected plunge in platinum production PwC, Sept. 2016 Existing shafts alone will barely maintain current production to 2021. Then, closures of mined-out shafts will help trigger a lo
Slide 22: New production likely to give only short-lived lift in platinum output
Even new production now under development likely to provide only short-lived lift in platinum output (’000 oz.) Southern Africa's projected plunge in platinum production 2022: EXPECTED START OF INITIAL PRODUCTION FROM IVANHOE’S PLATREEF PROJECT PwC Ivanhoe’s Platreef is among new projects whose ra
Slide 23: Kamoa & Kakula: Development of two mining areas; ongoing exploration
Kamoa & Kakula: Development of two mining areas; ongoing exploration Democratic Republic of Congo
Slide 24: Kamoa, Kakula and Kakula West
Kamoa, Kakula and Kakula West Indicated and Inferred Mineral Resource areas, with existing power and rail infrastructure Kansoko mining area Kakula mining area 24
Slide 25: New resource estimate: world's fourth-largest copper discovery
February 2018: A new resource estimate established Kamoa-Kakula as the world’s fourth-largest copper discovery. Copper grades at the two adjacent deposits are the highest, by a wide margin, of the world’s top 10 copper deposits. 25
Slide 26: Indicated Mineral Resources, Kamoa-Kakula Project, February 2018
Indicated Mineral Resources, Kamoa-Kakula Project, February 2018 Cut-off Contained Contained Tonnes Area Copper Category Grade Copper Copper (millions) (Sq. km) Grade (Cu%) (kTonnes) (billion lbs) Indicated 3.0 396 33.2 4.79% 19,000 41.8 Indicated 2.5 535 44.0 4.25% 22,800 50.2 Indicated 2.0 780 53.
Slide 27: Among world's largest copper deposits, highest copper grades
Among the world’s largest copper deposits, Kamoa-Kakula also has the highest copper grades Measured & Indicated Resource and Grade Inferred Resource and Grade 150 3.0% Contained Copper (Mt) 125 2.5% Copper Grade (%) 100 2.0% 75 1.5% 50 1.0% 25 0.5% - - Source: Wood Mackenzie *Note: Selected based on
Slide 28: Kamoa-Kakula is the largest undeveloped copper deposit
Kamoa-Kakula is the largest undeveloped copper deposit in the world 45 Measured & Indicated Resource and Grade Inferred Resource and Grade 3.0% 40 Contained Copper (Mt) 2.5% Copper Grade (%) 35 30 2.0% 25 1.5% 20 15 1.0% 10 0.5% 5 - - Source: Wood Mackenzie *Note: Contained copper in undeveloped dep
Slide 29: Kamoa-Kakula is the largest high-grade copper deposit
Kamoa-Kakula is the largest high-grade copper deposit in the world Measured & Indicated Resource Inferred Resource 45 40 5.9 Contained Copper (Mt) 35 30 25 11.7 20 36.6 15 6.4 10 16.9 4.8 0.0 0.4 5 10.2 0.4 0.1 0.0 0.0 0.3 4.6 1.4 0.9 0.7 0.5 0.3 0.4 0.3 - Source: Wood Mackenzie *Note: Contained cop
Slide 30: Extent of Kakula / Kakula West Discovery
Extent of Kakula / Kakula West Discovery Kakula West discovery extends known mineralization to more than 13 km − and remains open. 30
Slide 31: Kakula and Kakula West grades at 3% copper cut-off
Kakula and Kakula West discovery areas showing grades of Indicated and Inferred Mineral Resource blocks at a 3% copper cut-off Kakula declines Kakula Boxcut 31
Slide 32: Kakula and Kakula West thickness at 1% copper cut-off
Kakula and Kakula West discovery areas showing the thickness of Indicated and Inferred Mineral Resource blocks at a 1% copper cut-off Kakula declines Kakula Boxcut 32
Slide 33: Development options
Development options Up to three mines, each 6 million tonnes a year, with central concentrator! That would be 18 million tonnes of ore each year! 1. Kakula mining area − being fast-tracked to production with capacity of 6 million tonnes of ore per year (Mtpa). 2. Kansoko mining area (at Kamoa) − dev
Slide 34: Underground development at Kakula totals more than 1,500 metres
June 2018: underground development at Kakula now totals more than 1,500 metres 34
Slide 35: Kamoa-Kakula PEA long-term development plan
Kamoa-Kakula PEA long-term development plan Source: OreWin 2017 35
Slide 36: 2025 top producing mines by paid copper production
2025 top 20 producing mines by paid copper production Paid Copper Production (ktpa) Note: Kamoa-Kakula production based on projected peak copper production (which occurs in year nine) of the 12 Mtpa development plan for the Kamoa-Kakula Project as detailed in the Kakula 2017 PEA. Source: Wood Macken
Slide 37: Top largest new greenfield projects
Top 10 largest new greenfield projects (Nominal production and head grade) First tenyears First 10 years average grade average grade 400 7.0% 350 6.0% 300 5.0% 250 4.0% 200 3.0% 150 100 2.0% 50 1.0% -- -- Nominal Production (kt/a) Copper Resource Grade (%Cu) Note: Top 10 largest new greenfield coppe
Slide 38: Exploration drilling extending Kakula West discovery
Exploration drilling is continuing to extend the northwestern limits of the Kakula West discovery 38
Slide 39: High-grade drill core with massive chalcocite from Kakula
High-grade drill core containing massive chalcocite (copper mineralization) from a new drill hole at Kakula Above: Recent Kakula drill core showing massive chalcopyrite mineralization within a carbonate vein. Below: Massive and bedded chalcocite within siltstone. 39
Slide 40: Kamoa-Kakula Sustainable Livelihoods Project
Chickens and eggs are among successes of the Kamoa-Kakula Sustainable Livelihoods Project, contributing to prospering economies in 14 communities near Ivanhoe's DRC projects. 40
Slide 41: Farmers at local community maize field
Farmers at a local community maize field – another initiative of the Kamoa-Kakula Sustainable Livelihoods Project 41
Slide 42: Mwadingusha hydroelectric plant upgrade
Mwadingusha hydroelectric plant upgrade Mwadingusha is the first of three hydroelectric power plants in the DRC being upgraded by Ivanhoe, Zijin and SNEL to secure a supply of clean, sustainable electricity for the development of Kamoa-Kakula. Its output has tripled, to 32 megawatts (MW), and sh
Slide 43: Kipushi Mine upgrading and exploration for a new era
Kipushi Mine upgrading and exploration for a new era Democratic Republic of Congo
Slide 44: Kipushi Fault Zone mined 1924-1993; Big Zinc
Kipushi Fault Zone was mined 1924-1993 to approx. 1,150-metre level. Big Zinc discovered prior to 1993 closure; never mined. 44
Slide 45: Planned and existing development at Kipushi
Planned and existing development at Kipushi 45
Slide 46: Pre-feasibility study for rebirth of Kipushi mine
December 13, 2017: Ivanhoe announced a pre-feasibility study for the rebirth of the historic Kipushi zinc-copper-silver-germanium mine The planned return to production would establish Kipushi as the world’s highest-grade major zinc mine. 46
Slide 47: Kipushi spur railway line rebuilding
Construction could start later this year on the D.R. CONGO rebuilding of the 34-kilometre KIPUSHI MINE Kipushi spur railway line to connect with the DRC's national railway at Munama, south of Lubumbashi. The Kipushi line, which has been Kipushi to Munama National 34 km spur line railway inactive sin
Slide 48: Rock crusher component secured 1,150 metres underground
Main-frame component for rock crusher secured on base plate 1,150 metres underground, ready for reassembly and commissioning 48
Slide 49: Upgraded 1,150-metre-level ore conveyor belt at Kipushi
Upgraded 1,150-metre-level ore conveyor belt at the historic, high-grade Kipushi zinc-copper- lead-germanium mine 49
Slide 50: Control-room operators at Kipushi's Shaft 5
Control-room operators at Kipushi’s Shaft 5 50
Slide 51: Know for Sure malaria testing initiative
Know for Sure initiative has equipped 252 health facilities with electronic DekiReaders for automated malaria testing and trained more than 600 healthcare workers. It is sponsored by Ivanhoe Mines and Zijin Mining, in collaboration with FioCorporation, of Toronto, and the DRC Ministry of Health. 51
Slide 52: Community adult literacy program at Kipushi
Community adult literacy program at Kipushi, sponsored by Ivanhoe Mines and implemented in partnership with AlfaCongo 52
Slide 53: Thank you.
Thank you.