Ivanhoe Mines Ltd. Class A · TSX:IVN
Ivanhoe Mines Ltd. Class A — TD Mining Conference 2020
33 slides from Ivanhoe Mines Ltd. Class A's conference presentation, January 2020
Slide 1: Ivanhoe Mines TD Mining Conference
IVANHOE MINES TD MINING CONFERENCE Platreef PGMs-Nickel-Copper Mine being developed in South Africa
Slide 2: Forward-Looking Statements & Qualified Person
FORWARD-LOOKING STATEMENTS & QUALIFIED PERSON This presentation has been prepared solely for informational purposes. You should not definitively rely upon it or use it to form the definitive basis for any decision, contract, commitment or action whatsoever, with respect to any proposed transaction o
Slide 3: Ivanhoe at a Glance
IVANHOE AT A GLANCE CORPORATE INFORMATION TSX: IVN LISTINGS OTCQX: IVPAF SHARE PRICE C$4.04 / share(1) MARKET CAP US$3.6 billion(1) SHARES, OPTIONS Common Shares: 1,197 million(2) & RSU Options and other: 31 million(2) CASH POSITION US$808 million(3) CITIC Metal 26.4% Zijin Mining 13.8% Robert Fried
Slide 4: Investment Highlights
INVESTMENT HIGHLIGHTS Three disruptive Significant growth Well funded Partnership with Experienced world-class projects in reserves and with strong CITIC and Zijin will management team, in their respective resources in some financial partners allow for a new, with strong track commodities: of the wo
Slide 5: Corporate Structure
CORPORATE STRUCTURE CORPORATE STRUCTURE 26.4% 13.9% Robert Friedland 13.2% 12.8% 39.5% 100%(1) 64% 68% KAMOA-KAKULA WESTERN FORELAND PLATREEF KIPUSHI 39.5% 20% 1% 26% 9.9% 32% Government Crystal BEE Japanese Consortium led Gécamines of DRC(2) River Partners by Itochu Copper Copper PGMs, Nickel, Copp
Slide 6: Experienced Board and Management Team
EXPERIENCED BOARD AND MANAGEMENT TEAM BOARD OF DIRECTORS EXECUTIVE MANAGEMENT TEAM Mr. Robert Friedland, Founder and Executive Co-Chairman Mr. Tony Giardini Recognized as an entrepreneurial explorer, technology innovator, and President company builder Former Executive Vice President and Chief Fi
Slide 7: World's Leading Mining Development Company
WORLD’S LEADING MINING DEVELOPMENT COMPANY $3.5 Ivanhoe market capitalization $4.5 S&P M&M Index Broker(2) Target Price (C$) $3.0 Basket of peers (1) $4.0 AB Bernstein $16.00 Copper price (secondary axis) BMO Capital Markets $9.00 Market Capitalization (US$bn) 6 $2.5 $3.5 Canaccord Genuity $8.50 Cop
Slide 8: Codelco's Grade Problem – Mining More, Producing Less
CODELCO’S GRADE PROBLEM – MINING MORE, PRODUCING LESS 8
Slide 9: Environment for Return Toward Peak Cycle Valuations
ENVIRONMENT FOR RETURN TOWARD PEAK CYCLE VALUATIONS Market Cap. (US$bn) / Growth to Peak (%) $269 102% $154 50% $73 84% $57 222% $38 349% $25 104% Valuation of $103 Mining Majors $133 $39 $12 – Peak Cycle $18 Value (Early- $9 2011) vs. Today Peak Cycle Today Peak Cycle Today Peak Cycle Today Peak Cy
Slide 10: Kamoa-Kakula: Unrivalled Resource Base
UNRIVALLED RESOURCE BASE • World’s largest, high-grade undeveloped copper deposits with 36.6 Mt (Ind.) + 5.6 Mt (Inf.) KAMOA-KAKULA of contained Cu(1) • Mineral reserves of 6.6 Mt of contained Cu at an average grade of 5.48% Cu(2) • Open down dip and along strike – excellent exploration potential Wo
Slide 11: Kamoa-Kakula Is the First Major Copper Discovery
KAMOA-KAKULA IS THE FIRST MAJOR COPPER DISCOVERY WITHIN THE CENTRAL AFRICAN COPPERBELT SINCE THE EARLY 1990s Geologically distinct, yet geographically next door to the well-known Kolwezi deposits 11
Slide 12: Kamoa-Kakula Reserves and Resources
KAMOA-KAKULA Cu Cu Cu Category Mt % Bnlb Mt Probable (Kakula) 120 5.48 14.5 6.6 Probable (Kamoa) 125 3.81 10.5 4.7 Total Reserves 245 4.63 25.0 11.3 Indicated (Kakula) 628 2.72 37.6 17.1 Indicated (Kamoa) 759 2.57 43.0 19.5 M&I Resources(1) 1,387 2.64 80.6 36.6 Inferred (Kakula) 114 1.59 4.0 1.8 Inf
Slide 13: Five Year Development Plan
FIVE YEAR DEVELOPMENT PLAN Kakula Indicated Resources - 174 million tonnes at 5.62% copper (1) 13 1. 3.0% cut-off, per February 2018 resource update.
Slide 14: Kamoa-Kakula in Construction
KAMOA-KAKULA IN CONSTRUCTION 14
Slide 15: Kamoa-Kakula Integrated Development Plan
KAMOA-KAKULA INTEGRATED DEVELOPMENT PLAN Once Fully Expanded, Kamoa-Kakula Will Become the World’s Second Largest Copper Mine 15
Slide 16: Latest PEA and PFS Results
LATEST PEA Description Kakula PFS (Feb. 2019) Kamoa-Kakula PEA (Feb. 2019) AND PFS Mining Area Kakula Kakula + Kamoa + Kakula West RESULTS Steady State Production 3.8 Mtpa + 3.8 Mtpa 6 Mt 18 Mt (6 + 6 + 6 Mt) capacity(5) Copper Feed Grade (1) 6.39% 5.66% Copper Recovery (2) 85.4% 85.1% Copper Concen
Slide 17: Kamoa-Kakula: Outstanding Financial Returns
KAMOA-KAKULA: OUTSTANDING FINANCIAL RETURNS Large Resource Very High Grade Low Cost Low Capital Intensity Phase 1(1) – February 2019 PFS Phase 2,3(2) – February 2019 PEA 47% IRR(3) 41% IRR(3) US$5.4 billion After-Tax NPV(3) US$10.0 billion After-Tax NPV(3) $1.3Bn initial • $1.1 billion peak funding
Slide 18: Operational Railway Linking DRC Mines with Lobito Port
Operational railway linking DRC mines with Angola’s Atlantic port of Lobito 18
Slide 19: Kamoa-Kakula: The World's Next Great Copper Mine
KAMOA-KAKULA: THE WORLD’S NEXT GREAT COPPER MINE One of the World’s Largest Copper Mines (1) The World’s Largest High-Grade Copper Deposit (2) 1,200 150 3.0% Paid Copper Production (ktpa) 1,000 125 2.5% 800 100 2.0% 75 1.5% 600 50 1.0% 400 25 0.5% - - 200 Oyu Tolgoi (Mongolia) Grasberg (Indonesia) C
Slide 20: Exploration and Western Foreland
EXPLORATION AND WESTERN FORELAND Offers Significant Upside to The Quality and Economics of Our Copper Assets • Significant exploration potential remains on both our Kamoa-Kakula joint venture, and 100%(1) owned Western Foreland ground • Significant potential for mineralization continuing from JV gro
Slide 21: Exploration and Western Foreland
EXPLORATION AND WESTERN FORELAND Significant recent drilling intercepts (at the 3%, 2% and 1% copper cut-off) from Kamoa North Bonanza Zone • DD1450 intersected 22.3 meters of 13.05% copper • DD1486 intersected 16.70 metres of 15.84% copper • DD1494 intersected 13.15 metres of 9.88% copper • DD1497
Slide 22: We Are Finding More Bonanza-Grade Ore
WE ARE FINDING MORE BONANZA-GRADE ORE AS OUR KNOWLEDGE OF THE DEPOSIT INCREASES Kansoko Kakula Kamoa North 1% cutoff 2% cutoff 3% cutoff 2% cutoff 1% cutoff 3% cutoff 2% cutoff 3% cutoff 2% cutoff 1% cutoff 3% cutoff 2% cutoff 1% R4.2 contact R4.2 contact R4.2 contact R4.2 contact 35.3m @ 11.0% Cu 9
Slide 23: Platreef: Large, High-Grade Deposit
LARGE, HIGH-GRADE DEPOSIT • 346Mt M&I Resources at 3.77 g/t 3PE+Au, and 506Mt Inferred Resources at 3.24g/t 3PE+Au, with significant base metal endowment: >0.3% Ni and >0.15% Cu on average PLATREEF • Significant exploration upside; deposit open along strike and down dip for several kms ONE OF WORLD’
Slide 24: Bushveld Complex
Waterberg Discovery BUSHVELD COMPLEX PLATREEF DISCOVERY Mogalakwena Mine Mokopane The Bushveld Complex produces ~70% of global platinum Amplats Impala PTM Lonmin Other Town / City Smelter / refinery Source: Company filings, Wood Mackenzie. 24
Slide 25: Palladium Is Now More Expensive Than Gold Has Ever Been
PALLADIUM IS NOW MORE EXPENSIVE THAN GOLD HAS EVER BEEN 25
Slide 26: Prices for the World's Most Precious Metal Are Soaring
PRICES FOR THE WORLD’S MOST PRECIOUS METAL ARE SOARING As of January 20, 2020, rhodium has hit USD$9,100 an ounce 26
Slide 27: Platreef Mineral Reserves and Resources
PLATREEF Mineral Reserves and Resources Tonnage and Grades Mt 3PE+Au (g/t) Cu (%) Ni (%) Probable Mineral Reserves Total 125 4.40 0.17 0.34 Indicated Mineral Resources (inclusive of Reserves) 3.0 g/t cut-off (3PE+Au) 204 4.70 0.18 0.35 2.0 g/t cut-off (3PE+Au) 346 3.77 0.16 0.32 Inferred Mineral Res
Slide 28: Platreef: Strong Returns and Very Long Life
PLATREEF: STRONG RETURNS AND VERY LONG LIFE Highly Significant Production Scale Minimal First Quartile Cash Costs Preliminary Economic Assessment(1) Feasibility Study(2) 14.9% IRR 14.2% IRR US$2.2 billion After-Tax NPV US$916 million After-Tax NPV • $1.85 billion peak funding capex • $1.5 billion pe
Slide 29: Platreef In-Situ Value of Reserves
PLATREEF IN-SITU VALUE OF RESERVES Platreef Revenue Per Tonne of Probable Reserves Platreef Revenue Per Tonne of Probable Reserves (US$/t ore) (ZAR/t ore) $300 4,000 3,500 $250 3,000 $200 LT Street Consensus (Sep 2019) 2,500 LT Street Consensus (Sep 2019) DFS Price (July 2017) DFS Price (July 2017)
Slide 30: Shaft 1 Now Extends to a Depth of More Than 957 Metres
SHAFT 1 NOW EXTENDS TO A DEPTH OF MORE THAN 957 METRES Mineralized orebody at Shaft 1 is 29 metres thick (T1 & T2). With grades up to 11 g/t 3PE (platinum, palladium and rhodium) plus gold, as well as significant quantities of nickel and copper. 30
Slide 31: Platreef Positioned to Become a Leading PGM Producer
PLATREEF POSITIONED TO BECOME A LEADING PGM PRODUCER Phase 3 1,400 (12M t pa) Expected To Be Largest Primary PGM Producer (1) 1,200 Phase 2 Pt Equivalent Production (kozpa) ( 8M t pa) 1,000 Phase 1 800 ( 4M tpa) 600 400 200 - Amandelbult Kroondal Two Rivers Bokoni Marula BRPM Mimosa Marikana Lac des
Slide 32: Platreef in Context
80 10.0 75.7 9.0 70 M&I Resources (including Reserves) (Moz Gold Eq.) PLATREEF 61.6 8.0 M&I Resource Grade (g/t Gold Eq.) 60 IN CONTEXT 7.0 50 5.5 45.0 6.0 40 5.0 Spot Gold 29.9 3.3 4.0 30 Equivalent M&I 3.0 26.0 2.7 3.0 2.3 2.2 Resources 20 12.7 2.0 Compared to Top 10 5 Gold Producers 1.0 -- -- Nev
Slide 33: Thank You
THANK YOU