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. The Company is focused on the mining, development and exploration of minerals and precious metals from its property interests located primarily in Africa. Its projects include The Kamoa-Kakula Copper Complex, The Kipushi Project, The Platreef Project., and The Western Foreland Exploration Project. The Kamoa-Kakula Copper Complex project stratiform copper deposit with adjacent prospective exploration areas within the Central African Copperbelt, approximately 25 kilometers (km) west of the town of Kolwezi and about 270 km west of the provincial capital of Lubumbashi. The Kipushi mine is adjacent to the town of Kipushi in the Democratic Republic of the Congo (DRC) approximately 30 km southwest of the provincial capital of Lubumbashi. The 21 licenses in the Western Foreland cover a combined area of 1,808 square kilometers to the north, south and west of the Kamoa-Kakula Copper Complex.

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Ivanhoe Mines Ltd

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Post by guarantor1on May 26, 2021 11:11am

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Post# 33267590

BMO

May 26, 2021 | 10:17 ET | 10:17 ET~

Ivanhoe Mines

IVN-TSX Rating Price: May-25 Target Total Rtn Outperform $9.00 $10.00 11%

24-Year Overnight Success: First Kamoa Copper Production

Bottom Line:

This morning Ivanhoe announced the production of first copper concentrate from Kamoa/Kakula. This marks the culmination of 24 years of exploration, discoveries, and construction but notably first production was delivered five years from the Kakula discovery. This is an important milestone for Ivanhoe shareholders, and we expect further revaluation of the shares as the mine ramps up over the next months and the Phase 2 expansion (remains ahead of schedule) is delivered by Q3 2022.

Key Points

Ivanhoe announced that they produced first copper concentrate yesterday
and that the processing plant is in continuous operation. We would highlight
that the press release indicates that ore is being fed at grade (5-6%) directly from
the underground mine which in our opinion suggests good operation of both the underground mine and mill. Previous management commentary has indicated an expectation of a relatively quick ramp up of the processing plant over several weeks. Management is reiterating previously released 2021 copper production guidance of 80-95,000t of copper in concentrate on a 100% basis. For reference, the capacity of Phase 1 is roughly 200,000tpy and the expansion to Phase 2 (in Q3 2022) delivers about 400,000tpy of copper in concentrate.

Looking ahead investors will be watching for the following Kakula/Kamoa milestones:

Ongoing monthly operations updates will continue and will represent the best reference for ramp-up performance for Phase 1 and construction of Phase 2.
2021 Costs guidance will be provided once the processing plant reaches steady state production.
Update on copper concentrate off-take arrangements are expected to be announced in the "near term."

First production is a positive milestone for Ivanhoe, and we continue to see room for revaluation of Ivanhoe’s shares as the Kamoa/Kakula mine ramps up and expands to be one of the largest copper producers worldwide.