Name and Location
Kamoa copper project, Democratic Republic of Congo.

Client
The project is a joint venture (JV) between Ivanhoe Mines and Zijin Mining.

Project Description
The project has been independently ranked as the world’s largest undeveloped, high-grade copper discovery by international mining consultant Wood Mackenzie.

An independent prefeasibility study (PFS) on the first phase of development envisages the construction of an underground mine, a concentrator processing facility and associated infrastructure.

The PFS proposes a yearly mine production of three-million tonnes at an average grade of 3.86% copper over a 24-year mine life, resulting in production of 100 000 t/y.

The first phase of mining will target high-grade copper mineralisation from shallow underground resources to yield a high-value concentrate.

The planned second phase will entail a major expansion of the mine and mill, and construction of the smelter to produce blister copper.

Ivanhoe announced in January 2016 that the Kamoa exploration team had discovered a major new high-grade and flat-lying stratiform copper discovery, named Kakula, about 5 km south-west of Kamoa’s currently defined resources. Although the discovery represents a major extension of the Kamoa copper deposit, it has not been included in the independent PFS.

Net Present Value/Internal Rate of Return
The life-of-mine average mine-site cash cost is $0.75/lb of copper.

The project has an after-tax net present value (NPV), at an 8% discount rate, of $986-million and an internal rate of return (IRR) of 17.2%, with a payback period of 4.6 years.

Improvements to the mining methods could potentially reduce average mine-site cash costs during the first phase to $0.61/lb of copper, and improve the after-tax NPV, at an 8% discount rate, to $1.18-billion, the IRR to 18.9% and the payback period to 4.3 years.

Value
The initial capital cost of the project, including contingency, is estimated at $1.2-billion, about $200-million less than estimated in the preliminary economic assessment completed on Kamoa in 2013.

Duration
Not stated.

Latest Developments
Ivanhoe Mines and JV partner Chinese miner Zijin Mining are preparing to accelerate a planned infill drilling programme at the Kamoa copper starting next month.

Speaking at the fifteenth World Copper Conference in Santiago, Chile, Ivanhoe Mines executive chairperson Robert Friedland said the Kamoa exploration team’s goal was to complete about 25 000 m of additional drilling in the Kakula discovery area in 2016.

The company is upgrading access and drill roads in the Kakula discovery area to support the additional diamond drill rigs, which will be mobilised to the site early next month.

“Our accelerated infill drilling programme will target thick, flat-lying, shallow resources at grades materially higher than the average grades at Kamoa that potentially could be incorporated into our Phase 1 feasibility study, which could enhance the already robust economics that were reported in our independent prefeasibility study on February 23,” Friedland has said, adding that this will help ensure that Kamoa becomes one of the highest-grade new copper mines in the world, he has added.

The accelerated programme will initially focus on a 12 km2 area along the projected trend of mineralisation, intersected in holes DD996 and DD997, which were completed in 2015. The programme now also includes follow-up infill drilling aimed at defining indicated resources in areas where the continuity of materially higher grade has been confirmed.

Ivanhoe Mines reported in January that the Kamoa exploration team had made a new tier-one, high-grade, shallow and flat-lying stratiform copper discovery, ideally situated for low-cost mechanised mining, in the Kakula discovery area, about 5 km southwest of the currently defined resources at the Kamoa copper deposit.

The Kakula discovery is situated within the 400 km2 Kamoa Mining licence area and represents a major extension of the Kamoa copper deposit, which the company discovered in 2008.

Friedland said in the January announcement that the Kamoa copper deposit was already distinguished as the world’s largest, undeveloped, high-grade copper discovery and that it held promise for significant and rapid expansion of the deposit.

Key Contracts and Suppliers
OreWin (PFS).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Ivanhoe Mines, tel +1-604 688 6630 or email info@ivanhoemines.com.