Ivanhoe Mines provides 2024 production results, 2025 production guidance
January 8, 2025
Ivanhoe Mines provides 2024 production results, 2025 production guidance ■ Kamoa-Kakula produced record 437,061 tonnes of copper in concentrate in 2024 ■ Kamoa-Kakula quarterly production record of 133,819 tonnes of copper, a quarter-on-quarter increase of 15%, and monthly production record of 47,058 tonnes in December ■ Kamoa-Kakula sets 2025 production guidance at between 520,000 and 580,000 tonnes of copper ■ Smelter commissioning may be delayed by up to three months following limited fire damage to back up generation capacity, expedited repairs underway ■ Kipushi produced 50,307 tonnes of zinc in concentrate in 2024, including a monthly record 14,900 tonnes in December as ramp-up approaches nameplate capacity ■ Kipushi sets 2025 production guidance at between 180,000 and 240,000 tonnes of zinc ■ Ivanhoe Mines provides update to 2025 capital expenditure guidance ■ Ivanhoe Mines to issue 2024 financial results after market close on February 19, host conference call for investors on February 20
JOHANNESBURG, SOUTH AFRICA – Ivanhoe Mines’ (TSX: IVN; OTCQX: IVPAF) Executive Co-Chair Robert Friedland and President Marna Cloete announced today the company’s fourth quarter and full-year production results for the Kamoa-Kakula Copper Complex in the Democratic Republic of the Congo (DRC) and the ultra-high-grade Kipushi zinc mine, also in the DRC. In addition, the company has announced its 2025 production guidance for Kamoa-Kakula and Kipushi, as well as updated 2025 group capital expenditure guidance.
Watch the video summarizing Kamoa-Kakula’s 2024 operational highlights and future production guidance:
https://vimeo.com/1044780723/a114ecda2d?share=copy
Kamoa-Kakula delivers another record-breaking year with 437,061 tonnes of copper produced in 2024, a year-on-year increase of 12%
Kamoa-Kakula delivered record production in 2024 of 437,061 tonnes of copper in concentrate, a 12% year-on-year increase, following the ramp up of the Phase 3 concentrator in the second half of 2024.
Production for the fourth quarter of 133,819 tonnes of copper in concentrate, a 15% increase from the third quarter, is also a record. This was a result of strong performance from the Phase 1 and 2 concentrators, delivering record throughput with improved grade and recovery, as well as the Phase 3 concentrator reaching and at times exceeding nameplate design parameters.
Kamoa-Kakula summary of quarterly and annual production data
| Q1 2024 Q2 2024 Q3 2024 Q4 2024 Phase 1 & 2 | FY 2024 |
| Ore tonnes milled (000’s tonnes) 2,061 2,288 2,215 2,329 Copper ore grade processed (%) 4.80% 5.04% 4.86% 5.08% Copper recovery (%) 87.4% 87.0% 86.6% 87.0% Copper in concentrate produced (tonnes) 86,117 99,706 94,214 102,042 Phase 3 | 8,893 4.95% 87.0% 382,078 |
| Ore tonnes milled (000’s tonnes) - 93 1,050 1,326 Copper ore grade processed (%) - 1.67% 2.64% 2.82% Copper recovery (%) - 83.3% 79.9% 85.1% Copper in concentrate produced (tonnes) - 1,106 22,099 31,777 | 2,469 2.70% 82.9% 54,983 |
Combined Phase 1, 2 and 3
| Ore tonnes milled (000’s tonnes) | 2,061 | 2,381 | 3,266 | 3,655 | 11,362 |
| Copper ore grade processed (%) | 4.80% | 4.91% | 4.14% | 4.26% | 4.46% |
| Copper recovery (%) | 87.4% | 86.9% | 85.3% | 86.6% | 86.5% |
Copper in concentrate produced (tonnes) 86,117 100,812 116,313 133,819 437,061
Numbers in red denote a quarterly record
During the month of December, Kamoa-Kakula delivered record production of 47,058 tonnes of copper in concentrate. The Phase 3 concentrator milled at an annualized rate of 5.7 million tonnes per annum during the month, 13% above design capacity, and achieved an average recovery rate of 86.6%, in line with design parameters.
Kamoa-Kakula’s high- and medium-grade ore surface stockpiles totaled approximately 4.19 million tonnes at an estimated, blended average grade of 3.18% copper. Contained copper in the stockpiles at the end of December totaled approximately 133,000 tonnes.
At year-end, there were approximately 30,000 tonnes of unsold copper in inventory, up from 16,000 tonnes of unsold copper in concentrate at the end of the third quarter. The inventory of unsold copper is largely undergoing toll treatment at Lualaba Copper Smelter (LCS) and is expected to reduce during the first quarter.
Figure 1: Kamoa-Kakula’s monthly growth in 2024 copper production
Figure 2: Kamoa-Kakula’s total annual copper production growth since first production in May 2021.
437,061 393,551
333,500
105,884
FY2021 FY2022 FY2023 FY2024
A limited portion of Kamoa-Kakula’s on-site back up generator capacity damaged by fire; expedited repairs underway
On January 2, 2025, a fire occurred at an on-site generator bank near the Kakula operations. The fire was rapidly contained and extinguished by Kamoa-Kakula’s emergency response team. There were no injuries reported, no damage to other infrastructure, and production operations were not impacted.
Prior to the fire, Kamoa-Kakula had over 190 megawatts (MW) of on-site diesel- generated back up power installed, supplementing the grid-supplied domestic and imported hydroelectric power. On-site back up power increased during the fourth quarter, following the installation of 48 MW of new diesel-generated power.
36 MW of Kamoa-Kakula’s onsite, diesel-generated back up power was damaged by the recent fire. Initial estimates indicate that 34 MW, out of the total 36 MW of damaged capacity, are repairable. It will take between three and six months to return the back up units to operation. An insurance claim will be made based on existing policies in place. A full assessment of the damage is expected to be completed within the coming weeks.
Kamoa-Kakula’s engineering team is conducting a full investigation into the cause of the fire to assess the need for additional preventative measures across the generator farms. In the meantime, surveillance of the back up generators has increased, including the deployment of dedicated fire crews at each bank of generators.
Approximately 160 MW of diesel-generated back up power remains available, which is distributable across the Kakula and Kamoa operating sites. Currently, Kamoa-Kakula is drawing 90 MW of domestic and imported hydropower. Kamoa- Kakula’s management are in discussions to secure increased domestic and imported hydropower as soon as possible. Even in the extremely unlikely event that all grid-supplied power were to completely fail, there is sufficient onsite back up generator capacity available to run Kamoa-Kakula’s Phase 1, 2, and 3 operations, excluding the smelter.
Total power required to operate the Phase 1, 2, and 3 operations, as well as the smelter at full capacity, is approximately 240 MW. Kamoa-Kakula’s smelter operations team is considering delaying the heat-up of the on-site copper smelter by up to three months, while the damaged generators are being repaired or additional domestic or imported hydropower is secured.
In addition, wet commissioning of Turbine #5 at Inga II, with a hydroelectric generation capacity of 178 MW, is now expected to commence in the second quarter. Kamoa-Kakula is expected to be allocated an initial, additional 70 MW of hydropower from the grid in the second quarter, which will increase over time to 178 MW as grid improvement initiatives are completed.
The blasting and painting team from Prezioso Congo SA inside the spiral case of the new 178-MW Turbine #5 at Inga II hydroelectric facility.
In December, the new turbine runner was lowered into place and installed inside Turbine #5 at Inga II. Wet commissioning of Turbine #5 at Inga II is expected to commence in the second quarter and will provide Kamoa- Kakula with 178 MW of clean, hydropower by year-end.
Ivanhoe Mines exploring options for future hydropower imports from Angola
On July 4, 2024, Trafigura Group of Geneva, Switzerland and ProMarks of Luanda, Angola signed a Memorandum of Understanding (MOU) with the Government of Angola to study the technical and economic viability of building a 2,000 MW high- voltage electricity “interconnector” (a high-voltage direct current transmission line) to export surplus green electricity to the DRC Copperbelt and Zambia. The project enables electricity generated by hydroelectric dams located in the north of Angola to be connected to the Southern Africa Power Pool. A joint venture will be formed between ProMarks and Trafigura to develop, finance, construct and operate the electricity “interconnector”. The project is intended to be financed through a combination of equity capital and third-party debt. Planning, approvals and construction would take around four years after the final investment decision is made.
Kipushi produced 50,307 tonnes of zinc during inaugural year, including a monthly record 14,900 tonnes in December as ramp-up approaches nameplate capacity
In 2024, the Kipushi concentrator milled 228,293 tonnes of ore at an average grade of 29% zinc, producing 50,307 tonnes of zinc in concentrate at a grade of approximately 50%.
Following slower than anticipated ramp up progress in the third quarter, operations at the Kipushi concentrator significantly improved during the fourth quarter, with several processing records achieved. 135,285 tonnes of ore were milled at an average grade of 28%, producing a record 32,323 tonnes of zinc. This includes a record 14,900 tonnes produced during December, which is equivalent to an annualized production rate of approximately 175,000 tonnes of zinc.
In addition, during the last day of the year, a record 750 tonnes of zinc were produced over 24 hours, exceeding nameplate capacity. Over the same period, 2,200 tonnes of ore were milled by the concentrator, in line with the design rate. The Kipushi concentrator is expected to consistently achieve its nameplate milling rate during the first quarter.
At the end of December, Kipushi’s high- and medium-grade ore surface stockpiles totaled approximately 344,000 tonnes at an estimated average grade of 23% zinc. Contained zinc in the stockpiles totaled approximately 79,500 tonnes.
Kipushi’s 800,000 tonnes per annum concentrator set several milling and production records in December 2024.
2025 Production Guidance
Ivanhoe Mines’ 2025 production guidance is based on several assumptions and estimates as of December 31, 2024. The guidance provided involves estimates of known and unknown risks, uncertainties, and other factors that may cause the actual results to differ materially.
In recent months, imported power available to Kamoa-Kakula has been reduced due to drought conditions affecting hydroelectric capacity in Zambia and Mozambique. Although the rainy season has begun, it is too early to predict the degree to which reservoirs that provide hydropower in Zambia and Mozambique will be recharged. Given this uncertainty, 2025 production guidance will be reviewed at the end of the rainy season in the second quarter.
2025 Production Guidance
Kamoa-Kakula 520,000 – 580,000 Contained copper in concentrate (tonnes)
Kipushi 180,000 – 240,000 Contained zinc in concentrate (tonnes)
All figures are on a 100%-project basis and metal reported in concentrate is before refining losses or payability deductions associated with smelter terms.
Kamoa-Kakula is targeting a production rate of approximately 600,000 tonnes of copper in concentrate for 2026, following power generation and grid improvement initiatives in progress, together with optimization projects for improved Phase 1 and 2 recoveries (Project 95) and increased Phase 3 throughput underway.
Kipushi is targeting a production rate of over 250,000 tonnes of zinc in concentrate for 2026, following the completion of ramp-up and debottlenecking activities targeted for Q3 2025.
Ivanhoe Mines will provide C1 cash cost (C1) per pound of payable copper and payable zinc guidance for 2025 in its 2024 year-end financial results release. Guidance on Platreef’s production and C1 cash costs will be provided after ramp- up, which is expected to commence in H2 2025.
Ivanhoe Mines provides update to 2025 Capital Expenditure Guidance
The company’s updated capital expenditure guidance is summarized as follows:
9M 2024 2024 2025 Capital Expenditure Actuals(1) Guidance(1) Guidance
($' million) ($' million) ($' million) Kamoa-Kakula
Phase 3 and other 1,397 1,350 – 1,750 1,300 – 1,050 expansion capital Sustaining capital 220 240 370
1,617 1,590 – 1,990 1,670 – 1,420 Platreef
Phase 1 initial capital 66 110 – 140 100 – 70 Phase 2 capital 123 130 – 180 220 – 170
189 240 – 320 320 – 240 Kipushi
Initial and expansion 185 185 25 capital Sustaining capital – 35 40
185 220 65 All capital expenditure figures are presented on a 100%-project basis.
(1) As at September 30, 2024.
The guidance ranges previously provided reflected uncertainty in the timing of Kamoa-Kakula Phase 3 expansion and Platreef Phase 2 capital between the calendar years of 2024 and 2025. Guidance for 2024 has been kept unchanged and remains as at September 30, 2024, noting however that capital expenditure for Kamoa-Kakula is expected to be at the top end of the 2024 range, with sustaining capital expected to exceed guidance, and capital expenditure at Platreef is expected to be towards the bottom end of the range.
Construction of Kamoa-Kakula’s Phase 3 concentrator was completed on May 26, 2024, and construction completion of the smelter project is expected imminently.
2025 capital expenditure guidance for Kamoa-Kakula as shown in the above table includes capex recently approved related to the following:
($' million) Smelter
Increase in capital to completion, mostly related to logistics 115 Capitalized ramp up costs (not previously capitalized) 120 Uninterruptible power supply (UPS) and additional generators 80
Phase 3 Optimization and Phase 4 Expansion
Phase 3 mine optimization including underground infrastructure 115 Phase 3 de-bottlenecking initial capital cost 70 Phase 4 infrastructure early works and TSF expansion 135 Surface upgrades, including tarred roads and on-site camps 60
Sustaining Capital
Increase to support enlarged mining footprint 105
The Kamoa-Kakula’s Phase 1, 2, and 3 operations are anticipated to generate significant operating cash flow and are expected, together with joint venture-level financing facilities, to be sufficient to fund ongoing capital cost requirements at current copper prices.
Construction of Platreef’s Phase 1 concentrator was completed on schedule in July 2024. Hot commissioning and ramp-up of production are deferred to the second half of 2025. Platreef’s 2024 capital expenditure guidance in the above table is unchanged, the 2025 guidance is provisional and will be updated upon the completion of the updated Feasibility Study later in Q1 2025. The 2025 capital expenditure is expected to remain within the range outlined in the above table.
Construction of the Kipushi concentrator facility is complete and is ramping up to nameplate production. Kipushi’s 2025 capital expenditure guidance increases by $20 million to incorporate the concentrator de-bottlenecking program, which is expected to increase processing capacity by approximately 20% from Q3 2025, as well as for the purchase of additional on-site back up generating capacity.
Ivanhoe Mines will provide 2026 capital expenditure guidance in its 2024 year-end financial results.
Kamoa-Kakula signs offtake agreement and advanced payment facility for copper anodes produced by the on-site smelter
CITIC Metal Limited and Gold Mountains International Mining Company Limited, a subsidiary of Zijin Mining, have each signed an offtake agreement with Kamoa Copper for a combined 80% of the smelter’s anode production. The agreements were entered into on competitive arm’s-length commercial terms, over a three- year term. Production from the smelter, once fully ramped-up, is projected to be up to 500,000 tonnes of 99.7%-pure copper anodes per annum. The offtake agreements contain standard, international commercial terms, including refining charges based on the copper industry annual benchmark.
CITIC Metal and Gold Mountains will purchase the copper anodes on a free- carrier (FCA) basis from Kamoa-Kakula’s mine gate. CITIC have elected to use Ivanhoe’s trading subsidiary to arrange the inland transportation of copper anodes to the port of loading in Africa.
In addition, under the offtake agreements, CITIC Metal and Gold Mountains have provided an advance payment facility of $250 million each, totally $500 million, the full amount of which has been received. The advance payment facility will bear an annual interest rate of the 1-month Secured Overnight Financing Rate (SOFR), plus 3.75%.
Kamoa Copper is also in advanced discussions to sign a third offtake agreement for the remaining 20% of smelter production on the same terms. Negotiations are expected to conclude in the coming weeks.
Construction completion of the onsite copper smelter is expected imminently. Offtake agreements for 80% of the smelter’s 99.7%-pure copper anodes were recently signed with CITIC Metal and Gold Mountains.
Kamoa-Kakula 2025 Integrated Development Plan, including future growth initiatives such as Project 95, Phase 3 debottlenecking, and Phase 4 expansion, expected in Q2 2025
Following the last Integrated Development Plan, released on January 30, 2023, Kamoa’s engineering team is working on an updated 2025 Integrated Development Plan (2025 IDP), expected to be published in Q2 2025 The 2025 IDP will include initiatives targeting increased processing recoveries and processing throughput from the Phase 1, 2, and 3 concentrators, as well as a new Phase 4 expansion.
Kamoa’s engineering team is targeting to increase recovery rates of the Phase 1 and 2 concentrators and the Phase 3 concentrator, from the current nameplate rates of 87% and 86%, up to 95% and 92%, respectively, including Project 95. In addition, the processing capacity of the existing Phase 1, 2 and 3 operations is targeted to be boosted by up to 20%, from 14.2 Mtpa to 17 Mtpa.
The Phase 4 expansion involves doubling the size of the milling and flotation circuit adjacent to Phase 3. Like the Phase 2 expansion with Phase 1, the front- end crushing circuit installed for Phase 3 has already been oversized to accommodate Phase 4.
Phase 4 will be fed by ramping up new mining areas on the Kamoa-Kakula complex, timing of which is under study for the 2025 IDP.
Updated feasibility study for optimized Platreef Phase 2 and PEA for new Phase 3 expected in Q1 2025, ranking Platreef as one of the world’s largest producers of precious and base metals
In 2023, Ivanhoe’s engineering team completed an internal optimization study of the phased expansion of the Platreef Project. Current underground development and operations are dependent on the initial 1-Mtpa Shaft #1 until the 10-metre- diameter, 8-Mtpa Shaft #2 is commissioned. The study concluded that accelerating the startup of Phase 2 will create significant project value.
Following the completion of the optimization study, DRA Global of Johannesburg, South Africa, were appointed to update the Platreef 2022 Feasibility Study for the optimized and accelerated Phase 2 expansion. Study work is nearing completion, with results expected to be released in the first quarter of 2025.
In parallel with the release of the updated Phase 2 feasibility study, Ivanhoe also commissioned a preliminary economic assessment (PEA) for an additional expansion, Phase 3, taking the total Platreef processing capacity up to approximately 10 Mtpa. The new Phase 3 expansion is expected to consist of two additional 3.3-Mtpa concentrator modules, to be located adjacent to the Phase 1