Ivanhoe Mines Ltd. Class A · TSX:IVN
Ivanhoe Mines Ltd. Class A — Investor Presentation (August 2019)
62 slides from Ivanhoe Mines Ltd. Class A's investor presentation, August 2019
Slide 1: Over 20 years in Southern Africa
Over 20 years in Southern Africa. 3 advanced, unique projects. Positioned to realize urbanization’s resource opportunities with minerals to help build a better world.
Slide 2: CITIC Metal strategic equity investment completed
KAMOA-KAKULA August 16, 2019: Ivanhoe Mines completes strategic equity investment of C$612 million (US$459 million) from China-based CITIC Metal, bringing CITIC’s investment in Ivanhoe to more than US$1 billion. Additional C$67 million (US$50 million) received from Zijin Mining through the exercise
Slide 3: Kamoa-Kakula: Exploration & mine development
KAMOA-KAKULA Exploration & mine development Democratic Republic of Congo Our world’s best copper discovery Hole DD1571, which intersected 18.0% copper over 18.86 metres
Slide 4: Kakula Mine's first stage grade and cash costs
KAMOA-KAKULA The Kakula Mine’s first stage will average 6.8% copper over the first 5 years, with mine-site cash costs of US$0.43/lb copper
Slide 5: Independent pre-feasibility study for Kakula copper mine
KAMOA-KAKULA Independent pre-feasibility study (PFS) for the Kakula copper mine announced on February 6, 2019 The stage one, 6 Mtpa operation at Kakula, with estimated development capital of US$1.1 billion, yields an after-tax NPV8% of US$5.4 billion and an IRR of 47% over a 25-year mine life
Slide 6: PEA staged expansions and smelter economics
KAMOA-KAKULA The PEA envisions the staged mine expansions and smelter will be funded from internal cash flows and yields an after-tax NPV8% of US$10.0 billion and an IRR of 41%
Slide 7: Projected world's second largest copper mine
KAMOA-KAKULA Once the expanded PEA production rate of 18 Mtpa is achieved, Kamoa-Kakula is projected to become the world’s second largest copper mine, with peak annual production of more than 700,000 tonnes of copper
Slide 8: Highest-grade intersection ever drilled at Kamoa-Kakula
KAMOA-KAKULA August 18: Drilling intersects the highest-grade intersection ever drilled at the Kamoa-Kakula Project, with an estimated grade of 18.0% copper over 18.86 metres, at a 2% cut off
Slide 9: Kamoa North newly defined high-grade corridors
KAMOA-KAKULA DD1450 2 newly defined corridors Kamoa North − containing high-grade copper zones two new high-grade corridors trending onto Ivanhoe’s 100%-owned ground
Slide 10: Plan view of Kamoa North Bonanza Zone
KAMOA-KAKULA Plan view of Kamoa North Bonanza Zone drill-holes and interpreted high-grade corridor
Slide 11: North-south section through Kamoa North Bonanza Zone
KAMOA-KAKULA North-south section view through the Kamoa North Bonanza Zone
Slide 12: Copper replacing pyrite in KPS bonanza zone
KAMOA-KAKULA Schematic on how the copper replaced pyrite in the KPS bonanza copper zone in DD1450 Super high grade due to replacement of pyrite in the mineralised zone Diamictite Cpy Bn Bn Kamoa Pyritic Siltstone Cpy A Bn Diamictite +/- siltstone Normal mineralised zone
Slide 13: Kamoa North DD1450: 22.3 metres of 13.05% copper
KAMOA-KAKULA Kamoa North DD1450: 22.3 metres of 13.05% copper in shallow, flat-lying discovery hole
Slide 14: Mineralization profiles of recent Kamoa North holes
KAMOA-KAKULA Mineralization profiles of recent holes across the Kamoa North Bonanza Zone
Slide 15: Comparative grade profiles from Kansoko, Kakula, Kamoa North
KAMOA-KAKULA Comparative grade profiles from Kansoko, Kakula and Kamoa North discoveries
Slide 16: Core from the Kamoa North Bonanza Zone
KAMOA-KAKULA Core from the Kamoa North Bonanza Zone DD1520 sample from a downhole depth of 197 metres, containing predominantly massive chalcocite, bornite and some copper oxide (CuO). The grade of the sample is 46% copper. DD1522 sample from a downhole depth of 212.1 metres, containing finely disse
Slide 17: Drilling extends Kamoa Far North discovery
KAMOA-KAKULA Drilling extends 10-km Kamoa Far North discovery on to Ivanhoe’s 100%-owned Western Foreland exploration licences
Slide 18: Largest high-grade copper deposit in the world
KAMOA-KAKULA Kamoa-Kakula is the largest high-grade copper deposit in the world 45 40 5.9 Measured & Indicated Resource Inferred Resource 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:
Slide 19: Largest copper discovery ever made in Africa
KAMOA-KAKULA Kamoa-Kakula is the largest copper discovery ever made on the African continent 45 40 Measured & Indicated Resource Inferred Resource Historical Production Contained Copper (Mt) 35 30 25 20 15 10 5 - Source: Wood Mackenzie and USGS
Slide 20: Extent of Kakula / Kakula West Discovery
KAMOA-KAKULA Extent of Kakula / Kakula West Discovery Kakula West discovery extends known mineralization to more than 13 km − and remains open.
Slide 21: Kakula and Kakula West resource block grades
KAMOA-KAKULA Kakula and Kakula West discovery areas showing grades of Indicated and Inferred Mineral Resource blocks at a 3% copper cut-off
Slide 22: Underground development at Kakula approaching 10% copper
KAMOA-KAKULA July 2019: Underground development at Kakula approaching 10% copper!
Slide 23: Electrical substation construction at Kakula
KAMOA-KAKULA Construction continues at Kakula for an electrical substation for the decline conveyor system
Slide 24: New 34-kilometre highway to Kolwezi airport
KAMOA-KAKULA Ongoing construction of the new 34-kilometre highway directly linking the Kamoa-Kakula Copper Project to the Kolwezi airport, located southeast of the city of Kolwezi. The new highway is expected to be fully operational by the end of 2019.
Slide 25: DRC regional infrastructure
KAMOA-KAKULA DRC regional infrastructure Power line supplying Kolwezi Nzilo 1 hydroelectric power plant Mwadingusha dam DRC power lines are 10 km (6 miles) from Kamoa. Agreement with government to upgrade three existing hydroelectric power plants – Koni, Mwadingusha and Nzilo 1.
Slide 26: Operational railway to Lobito port
KAMOA-KAKULA Operational railway linking DRC mines with Angola’s Atlantic port of Lobito Sources: Railwaysafrica.com, enr.com, Stratfor & Grindrod
Slide 27: Road linking Kamoa-Kakula to Kolwezi airport
KAMOA-KAKULA Map showing road linking the Kamoa- Kakula Project to Kolwezi airport, and planned road to Solwezi, Zambia
Slide 28: National railways linking DRC mines with seaports
KAMOA-KAKULA National railways linking DRC mines with international seaports
Slide 29: Sustainable Livelihoods Project community maize field
KAMOA-KAKULA Farmers at a local community maize field – an initiative of the Kamoa-Kakula Sustainable Livelihoods Project
Slide 30: New secondary school near Kamoa-Kakula
KAMOA-KAKULA A new secondary school has been built in Kaponda, a small village near the Kamoa-Kakula Project, as part of the project's community relations program. Classes will begin soon at another school nearing completion at Muvunda village.
Slide 31: Western Foreland
Western Foreland A drill rig in action on the Makoko exploration area on a portion of Ivanhoe's 100%-owned Western Foreland licences. Makoko is approximately 20 kilometres west of the Kakula copper discovery.
Slide 32: Western Foreland exploration drilling
WESTERN FORELAND Ongoing exploration drilling on other targets identified in the Western Foreland area to test for high-grade copper
Slide 33: Kipushi: Mine development & upgrading
KIPUSHI Mine development & upgrading for a new era Democratic Republic of Congo
Slide 34: World's highest grade zinc-copper-silver-germanium mine
KIPUSHI Kipushi: world’s highest grade zinc-copper-silver-germanium mine in southeast DRC on the Zambian border Kamoa-Kakula Kipushi
Slide 35: The birth of a spectacularly high-grade mine
KIPUSHI The birth of a spectacularly high-grade mine In 1924, Kipushi began mining 18% copper from a surface open pit, before transitioning to Africa’s richest underground copper, zinc and germanium mine. Mining continued until 1993. 1928
Slide 36: Kipushi pre-feasibility study
KIPUSHI 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.
Slide 37: Big Zinc ready to mine
KIPUSHI +35% Big Zinc (circled in red): READY TO MINE…
Slide 38: New lighting at 1,200-metre level
KIPUSHI New lighting installed at 1,200-metre level
Slide 39: Control room operators at Shaft 5
KIPUSHI Control room operators at Kipushi’s Shaft 5
Slide 40: Upgraded 1,150-metre-level ore conveyor belt
KIPUSHI Upgraded 1,150-metre-level ore conveyor belt at the historic, high-grade Kipushi zinc-copper-lead-germanium mine
Slide 41: New underground mining equipment fleet
KIPUSHI A scooptram loader and haul truck, part of the fleet of new underground mining equipment
Slide 42: Shaft 5 main pumping station
KIPUSHI Shaft 5 main pumping station at the 1,200-metre level
Slide 43: Shaft 5 rock-hoisting winder
KIPUSHI Fully-operational Shaft 5 rock-hoisting winder
Slide 44: Community adult literacy program at Kipushi
KIPUSHI Community adult literacy program at Kipushi, sponsored by Ivanhoe Mines and implemented in partnership with AlfaCongo
Slide 45: Kipushi geology team at drill core shed
KIPUSHI Members of Kipushi’s geology team at the drill core shed
Slide 46: Core from hole KPU040
KIPUSHI Core from hole KPU040 showing massive copper sulphides with high silver values
Slide 47: Core from hole KPU008 in Serie Recurrente zone
KIPUSHI Core from hole KPU008 in the Serie Recurrente zone – 11 metres of 17% copper and 89.6 g/t silver
Slide 48: World's best drill hole?
KIPUSHI World’s best drill hole? Our geology team holding hands and showing Big Zinc intersection of 44.8% zinc over 340 metres
Slide 49: Platreef: Discovery & mine development
PLATREEF Discovery & mine development South Africa
Slide 50: Revenue per tonne of ore at Platreef at 3-year high
PLATREEF Revenue per tonne of ore at the Platreef Project now at 3-year high Total Cash Cost (Mine Site + Realization) Source: Bloomberg. Based on historical weekly commodity prices at the end of each week.
Slide 51: Bushveld Complex produces ~70% of global platinum
PLATREEF The Bushveld Complex produces ~70% of global platinum Waterberg Discovery “The opening up of the Northern Limb may be the most significant Mogalakwena Mine PLATREEF change in the economics of any Mokopane DISCOVERY commodity since the introduction of bulk mining techniques of the USA’s copp
Slide 52: Shaft 1 stations to access Flatreef orebody
PLATREEF 750-metre, 850-metre and 950-metre stations on Shaft 1 will provide access to the high-grade Flatreef orebody
Slide 53: First underground mining intersection of Platreef
PLATREEF September 26, 2018: First underground mining intersection of the Platreef mineralized belt on the Northern Limb of South Africa’s Bushveld Complex The first ore from the underground mine development was delivered to a surface stockpile for metallurgical sampling.
Slide 54: Platreef Shaft 2 box cut
PLATREEF Platreef’s Shaft 2 box cut, with the 11.5-metre shaft ring set-up for the 10-metre internal diameter shaft
Slide 55: Shaft 2 headframe foundation completed
PLATREEF Construction of the Shaft 2 headframe foundation was successfully completed in July 2019
Slide 56: Testing ventilation at Shaft 1 750-metre station
PLATREEF Testing the ventilation at Shaft 1’s 750-metre-level station. The shaft bottom currently is more than 900 metres below surface and completion of the shaft to a depth of 982 metres below surface is planned for early 2020.
Slide 57: Platreef Shaft 2 largest hoisting capacity
PLATREEF PLATREEF SHAFT 2 LARGEST HOISTING CAPACITY PRODUCTION SHAFT IN THE PRECIOUS METALS INDUSTRY Illustration shows two cut-away perspectives of Shaft 2’s 103-metre-tall concrete headframe and internal permanent hoisting facilities.
Slide 58: Schematic section of the Platreef Mine
PLATREEF Schematic section of the Platreef Mine
Slide 59: Platreef licences on Northern Limb
PLATREEF Platreef licences on Northern Limb Platreef horizon dips west. Platreef PGE-Au-Ni-Cu mineralization has thicknesses up to hundreds of metres. Key Platreef Amplats’ Mines Ivanhoe Mines Ivanhoe Mines JV Rietfontein City Turfspruit JV Anglo Platinum Lonmin Fault Macalacaskop Platreef Prope
Slide 60: Looming platinum supply cliff
PLATREEF The looming platinum “supply cliff” for Southern Africa’s existing producing mines (’000 oz.) Southern Africa's projected plunge in platinum production Existing shafts alone will barely maintain current production to 2021. Then, closures of mined-out shafts will help trigger a long prod
Slide 61: New production provides only short-lived platinum lift
PLATREEF Even new production now under development likely to provide only short-lived lift in platinum output (’000 oz.) Southern Africa’s projected platinum production plunge Ivanhoe’s Platreef is among new projects whose ramp-up outputs will slightly lift regional supply until 2021 – 2022: EXPEC
Slide 62: Thank You
HOS Ralsz,CeNEs 3 74