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 has deployed up to nine drills to undertake a 25 000 m drilling campaign on the Kakula discovery on the Kamoa copper mining licence area.

The infill and exploration drilling programme will test the high-grade and flat-lying stratiform copper discovery, ideally situated for low-cost, mechanised mining and representing a significant extension of the Kamoa copper deposit, which Ivanhoe discovered in 2008.

The new drilling programme, which started after the yearly rainy season, will target and delineate areas of thick, high-grade copper mineralisation intersected near surface at the Kakula discovery. The discovery is situated within the large, 60 km2 Kakula exploration area and about 10 km south-west of the Kamoa project’s planned initial mining area, at Kansoko Sud.

The drilling programme will focus on a 12 km2 area along the projected trend of mineralisation intersected in two high-grade holes – DD996 and DD997 – that were completed last year. Drilling will target shallow resources at grades materially higher than the average grades at Kamoa that potentially could be incorporated into Kamoa’s Phase 1 feasibility study, which is under way, the company has advised.

The programme will include follow-up infill drilling aimed to define indicated resources in areas where the continuity of materially higher grade has been confirmed.

An independent PFS on the first phase of development envisaged the construction of an underground mine, a concentrator processing facility and associated infrastructure.

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.