Ivanhoe Mines Ltd. (TSX: T.IVN, Stock Forum) has taken a key step towards lining up financing for its huge Oyu Tolgoi copper-gold project in Mongolia, an operation that is expected to cost US$4.6 billion to put into production..
The Vancouver mining company said BNP Paribas, Standard Chartered and Export Development Canada have been added to a core group of five lenders that will work to arrange a project finance debt package for the mine.
The other members of the group are the European Bank for Reconstruction and Development (EBRD) and the International Finance Corp. (IFC).
“The completion of the assembly of the core lender group is a key step in the process of securing the Oyu Tolgoi financing package, which we expect to close in the first quarter of 2011,’’ said Ivanhoe Executive Chairman Robert Friedland.
Ivanhoe said the five have indicated that they are prepared to consider providing limited resource loans worth over US$2 million. The IFC and the EBRD are considering providing up to US$300 million each, while the EDC may provide up to US$500 million.
It is expected that it will cost US$4.6 billion to put the open-pit mine on the Southern Oyu deposit into production.
Ivanhoe shares were up 0.82% on Monday to $17.26. Rio Tinto Plc (NYSE: RTP, Stock Forum), which joined Ivanhoe Mines as a strategic partner three years ago, currently holds a 22.4% stake in Ivanhoe.