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. The 60 km2 Kakula exploration area is about 10 km south-west of the Kamoa project’s planned initial mining area at Kansoko Sud. Although the discovery represents a major extension of the Kamoa copper deposit, it has not been included in the independent PFS.

The Kansoko Sud initial mining footprint contains high-grade intercepts of up to 7.04% copper and a potential mining thickness of more than 15 m. The mineralised horizon is expected to be intersected by the declines at about 150 m vertically below surface, where initial mining operations will start.

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
The first six holes drilled by Ivanhoe Mines have confirm an expanded, thick, flat-lying, bottom-loaded zone of high-grade copper mineralisation at the southern part of the Kakula discovery of the Kamoa copper project.

Initial assay results have confirmed the exceptional grades and widths of mineralisation from the expanded drilling programme on the project.

Among the highlights of the first six assayed drill holes are copper intercepts of 8.86 m (true width) grading 6.56% copper and 10.23 m (true width) grading 6.18% copper, at a 2.5% copper cutoff. By comparison, the average grade of copper ores in the twenty-first century is considered to be below 0.6% copper, with the proportion of economic ore minerals (including copper) being less than 2% of the total volume of the ore rock.

Ivanhoe has said that the results so far have the potential to have a significant, positive impact on the Kamoa project’s future development plans.

The company has noted that the bottom-loaded nature of the nearly flat-lying, stratabound chalcocite and bornite mineralisation at Kakula offers the potential for selective, mechanised underground mining at significantly higher copper grades than other large-scale mining projects.

Ivanhoe has further advised that the drilling programme at Kakula is now fully mobilised, with seven rigs operational in the field and two rigs on standby. The planned drilling of 25 000 m is scheduled to be completed in the third quarter.

Ivanhoe is also awaiting assay results on 14 drill holes.

Meanwhile, the twin declines for access at Kansoko Sud are progressing ahead of schedule.

Each decline has advanced more than 30 m since the first excavation blast occurred on May 12. Mine development has been designed to reach the high-grade copper ore during the first quarter of 2017.

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.