Pre-production ore stockpiles now hold 1.82 million tonnes grading 4.23% copper, containing more than 76,000 tonnes of copperFresh underground mining record achieved with 2,869 metres completed in January; more than 32.7 kilometres now complete – 11.6 kilometres ahead of planOverall progress of Kamoa-Kakula’s first phase, 3.8-Mtpa mining and milling operation now approximately 71% complete; first copper concentrate production remains on track for July 2021

KOLWEZI, DEMOCRATIC REPUBLIC OF CONGO – Ivanhoe Mines (TSX: IVN; OTCQX: IVPAF) Co-Chairs Robert Friedland and Yufeng “Miles” Sun are pleased to announce that underground development at the Kamoa-Kakula Copper Project in the Democratic Republic of Congo (DRC) mined and stockpiled 300,000 tonnes of ore grading 5.45% copper from the Kakula and Kansoko mines in January. The tonnage was 11.5% higher than December, while the copper grade was 1.6% higher.

The 300,000 tonnes mined in January included 231,000 tonnes at an average grade of 6.20% copper, including 82,000 tonnes grading 8.80% copper from the high-grade centre of the Kakula Mine.

The project’s pre-production surface stockpiles now contain approximately 1.82 million tonnes of high-grade and medium-grade ore at an estimated blended grade of 4.23% copper. Contained copper in the stockpiles increased by approximately 16,000 tonnes in January – a 25.9% increase over December’s production reflecting increased mining activity in the ultra-high-grade centre of the Kakula Deposit – to a cumulative total of more than 76,000 tonnes (the current copper price is approximately US$7,940 a tonne).

Kamoa-Kakula is on track to have approximately three million tonnes of high-grade and medium-grade ore stockpiled on surface, holding more than 125,000 tonnes of contained copper, prior to the planned start of processing in July 2021.

“In the mining business, grade is king,” said Mr. Friedland. “And the remarkable grade of the ore coming from Kakula is unprecedented for a major mechanized copper mine of this scale. We are just five months away from scheduled first production, which will mark the next step in the evolution of Ivanhoe Mines into a leading, diversified mining company with a development and exploration portfolio of high-value, critical green metals.”

Mr. Friedland and Mr. Sun also congratulated the project team for establishing yet another new monthly record for underground mine development in January with a total of 2,869 metres of advancement.

“A very strong operational and safety performance by our mining teams in January, and overall a terrific start to 2021,” said Mr. Friedland. “We are immensely proud of the more than 6,000 colleagues on site who are delivering this exceptional project on time and on budget. As we rapidly approach initial production, the project is busy recruiting and training the team that will operate the brand new concentrator plant, creating hundreds of additional permanent, well-paying jobs for local Congolese women and men.”

Underground mine development remains well ahead of schedule, providing the confidence to push forward with Kamoa-Kakula’s Phase 2 construction

January’s record-setting advancement brings total underground development to approximately 32.7 kilometres – around 11.6 kilometres ahead of schedule. The monthly underground development in January was comprised of 2,544 metres at the Kakula Mine and 325 metres at the Kansoko Mine.

Drift-and-fill stoping operations recently commenced at the Kakula Mine, with more than 66% of January’s ore production coming from stoping operations and the remaining coming from mine development activities. Stoping is a highly-productive mining method of extracting underground ore, leaving behind an open space known as a stope.

Mark Farren, Kamoa Copper’s CEO, commented: “The achievement of 300,000 tonnes mined in January is significant as Kamoa-Kakula is fast approaching the mining rate needed to sustain the project’s Phase 1 concentrator plant.”

“It will be important to balance mining volumes and surface stockpiles to meet the requirements of both the Phase 1 and Phase 2 concentrators. We now have nearly two million tonnes of medium- and high-grade ore on surface stockpiles, which should grow to approximately three million tonnes ahead of the scheduled start-up of the concentrator in July, significantly minimizing the ramp-up risk as well as streamlining the commissioning phase,” he continued.

“The large surface ore stockpiles will allow Kamoa-Kakula to maximize throughput once the Phase 1 concentrator is commissioned. Based on our projected mining rates over the next year and a half, we are confident that we also will have more than sufficient stockpiles ahead of the Phase 2 concentrator commissioning,” Mr. Farren added.

Kakula’s combined medium-grade and high-grade ore mined in January was approximately 274,000 tonnes at an average grade of 5.56% copper, including 82,000 tonnes grading 8.80% copper from the +8% copper zone in the centre of the orebody. Mining crews at Kakula are primarily focused on developing the drift-and-fill mining blocks in this high-grade centre. Opening up of the mining footprint for these high grade, drift-and-fill mining areas requires development work in areas of low-, medium- and high-grade ore, and is designed to coincide with the start-up of the processing plant in July. This will allow crews to deliver significant tonnage of high-grade ore directly from Kakula’s underground workings to the processing plant.

Kansoko’s combined medium-grade and high-grade ore mined in January was approximately 26,000 tonnes at an average grade of 4.31% copper. Kansoko’s ore grade increased by 73% in January, compared to December. Kansoko is being developed by training crews and will be a supplemental source of ore for Phase 2 of the project’s development when the Kakula concentrator processing capacity doubles to 7.6 million tonnes per annum (Mtpa) − currently planned to be commissioned in Q3 2022.

Miners drilling a 10-metre-high by 7.5-metre-wide drift near the centre of the Kakula Mine. The average grade of ore mined in this area is 8.80% copper.

Phase 1 copper production from the Kakula Mine is scheduled to begin in July 2021. Kakula is projected to be the world’s highest-grade major copper mine, with an initial mining rate of 3.8 Mtpa at an estimated average feed grade of more than 6.0% copper at first, ramping up to 7.6 Mtpa in Q3 2020. Phases 1 and 2 combined are forecast to produce approximately 400,000 tonnes of copper per year. Based on independent benchmarking, the project’s phased expansion scenario to 19 Mtpa would position Kamoa-Kakula as the world’s second largest copper mining complex, with peak annual copper production of more than 800,000 tonnes.

A 2020 independent audit of Kamoa-Kakula’s greenhouse gas intensity metrics performed by Hatch Ltd. of Mississauga, Canada, confirmed that the project will be among the world’s lowest greenhouse gas emitters per unit of copper produced.

The Kamoa-Kakula Copper Project is a joint venture between Ivanhoe Mines (39.6%), Zijin Mining Group (39.6%), Crystal River Global Limited (0.8%) and the Government of the Democratic Republic of Congo (20%).

January’s ore production was 11.5% higher than December, with monthly copper grade increasing from 5.36% to 5.45%; pre-production surface ore stockpiles now total approximately 1.82 million tonnes grading 4.23% copper

Chart 1: Cumulative tonnes and grade of pre-production ore stockpiles at the Kakula and Kansoko mines – May 2020 to January 2021.

Chart 2: Growth in contained copper in pre-production ore stockpiles at the Kakula and Kansoko mines – May 2020 to January 2021.

Chart 3: Projected growth in contained copper in the pre-production stockpiles at the Kakula and Kansoko mines up to July 2021. Dotted lines denote projections based on the 2020 pre-feasibility study.

The ore being mined from the northern portion of the Kakula Mine is transported to surface via the conveyor system and placed on a blended surface stockpile that now contains approximately 1.07 million tonnes grading an estimated 4.52% copper.

Additional pre-production ore stockpiles are located at the Kakula southern decline (approximately 243,000 tonnes of high-grade ore grading 5.85% copper and 303,000 tonnes of medium-grade ore grading 2.79% copper) and the Kansoko decline (approximately 12,000 tonnes of high-grade ore grading 6.19% copper and 192,000 tonnes of medium-grade ore grading 2.77% copper).

Kakula’s main pre-production stockpiles at the northern declines. The blended stockpiles currently contain approximately 1.07 million tonnes grading 4.52% copper.

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