Ivanhoe Mines Ltd. T.IVN

Alternate Symbol(s): IVPAF

Metals & Mining Industrial Metals & Minerals

Ivanhoe Mines Ltd. is a Canada-based mining, development, and exploration company. It is focused on the mining, development and exploration of minerals and precious metals from its property interests located primarily in Africa. Its projects include Kamoa-Kakula Complex, Western Foreland, Kipushi and Platreef. The Kamoa-Kakula Complex project is a stratiform copper deposit with adjacent prospective exploration areas within the Central African Copperbelt, approximately 25 kilometers (kms) west of the town of Kolwezi and approximately 270 kms west of the provincial capital of Lubumbashi. The 17 licenses in the Western Foreland cover a combined area of 2,407 square kilometers to the north, south and west of the Kamoa-Kakula Copper Complex. The Kipushi Project lies adjacent to the town of Kipushi and 30 kms southwest of the provincial capital of Lubumbashi. Its Platreef project is situated approximately eight km from Mokopane and 280 km northeast of Johannesburg, South Africa.

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Ivanhoe Mines Ltd. > BMO re Phase 2

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Post by guarantor1on Mar 23, 2022 7:51am

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Post# 34536871

BMO re Phase 2

IVN-TSX Rating Price: Mar-21 Target Total Rtn Outperform $11.56 $16.50 43%

Turning on Phase 2, Turning up Copper Production

Bottom Line:

Ivanhoe's Phase 2 plant at Kakula/Kamoa has begun processing ore, ahead of the previous schedule for startup beginning in April. With the accelerated production from Phase 2, Ivanhoe now expects to achieve the upper end of its 290,000-340,000t copper guidance in 2022. Ivanhoe will proceed with debottlenecking plans to increase Phase 1&2 throughput by 21% by Q2/23, will release a Phase 3 PFS in Q3, and will drill 95,000m at Western Foreland this year.

Key Points

Phase 2 startup ahead of schedule. Kakula/Kamoa's Phase 2 plant began processing ore on March 21, and has produced its first concentrate before the previously flagged April timeframe and four months ahead of the project's
initial schedule. The identical Phase 1 plant reached commercial production in approximately two months after first processing ore, and Ivanhoe emphasized that it expects Phase 2's ramp-up to be smoother thanks to its experience with Phase 1.
Targeting the upper end of guidance. With production from Phase 2 beginning ahead of schedule, Ivanhoe now expects to achieve the upper end of its 290,000-340,000t 2022 copper production guidance. While we are maintaining our forecast of 315kt in 2022, we would highlight Ivanhoe's track record of outperformance (it beat 2021 guidance at Kakula/Kamoa) and will be watching for further updates on Phase 2's ramp up.
Debottlenecking to grow production. With the Phase 1 processing plant consistently delivering throughputs 10-15% above design rates, Ivanhoe identified an opportunity to optimize the processing at both Phase 1 & 2 to permanently increase production by 21%, to a combined total of 9.2Mtpa. Production at this level, expected by Q2/23, would make Kakula/Kamoa the fourth-largest copper mine globally.
Progressing Phase 3 and Western Foreland. Phase 3 of Kakula/Kamoa is expected to begin operating by the end of 2024 and will be larger than the first two phases of the mine, and includes the construction of a 500ktpa smelter at the mine site. Ivanhoe noted that with Phase 2 now entering the production stage, its projects team will focus on advancing Phase 3, for which a PFS is expected in Q3. At Western Foreland, Ivanhoe plans to drill 95,000m this year as it ramps up exploration on the highly prospective, 100%-owned property near Kakula/Kamo