Ivanhoe Mines reaches agreement to rebuild a railway spur line

O October 30 0, 2017

Ivanho oe Mine es reach hes agre eement to rebu uild a railway sp pur line to supp port a ne ew era o of opera ation at t the Kip pushi zinc-copp per mine in the D Democra atic Rep public o of Congo

LIC OF CONGO (DRC)

K KIPUSHI, DEMOCRAT TIC REPUBL ) – Ivanhoe e Mines (TS SX: IVN; OT TCQX: IVPA AF) E Executive C Chairman R Robert Fried dland and C Chief Exec cutive Officer Lars-Eric Johansson a announced today that t the compa any has agreed to reb build 34 kilo ometres of track to co onnect the ne with the DRC national railway K Kipushi Min y at Munam ma, south of f the mining capital of f L Lubumbash hi.

nder terms of hi-Munama spur line, w T The Kipush which has been inactive since 2 2011, will be e rebuilt un a memorandum of und derstanding (MOU) sig a gned by Iva anhoe Mine es and the DRC’s stat te-owned railway com mpany, Soc ciété Nation nale des Ch hemins de Fer du Con ngo (SNCC)

).

T The DRC na ational railw way is a ke ey part of th he internati ional rail co orridor that t links the D DRC , Dar es Salaam in C Copperbelt to major seaports at Durban an nd Richards s Bay in So outh Africa, T Tanzania an nd Lobito in n Angola.

D Daily train ns for exp ports to in nternation nal ports

M Mr. Friedlan nd said the resumptio on of rail se ervice along g the Kipus shi spur lin ne is the mo ost e economical l and reliab ble solution n for the tra ansportatio on of Kipus shi’s projec cted annual l output of a approximat tely 530,000 0 tonnes of f zinc conc centrates.

e sections of T The World B Bank is ove erseeing an nd financin ng the rehabilitation a and upgrading of large the main DR RC national railway be etween Lub bumbashi a and the Zam mbia borde er crossing g at Sakania a. T The work ha as focused d on replacing the ballast beneat th the track ks and inst talling new concrete s sleepers (cr rossties) an nd heavier- -gauge steel rails. New signallin ng and telec communica ations e equipment also has be een installe ed along th he line.

“ “A daily train from Kip pushi will re eplace the equivalent t of 50 road d trucks, re esulting in s significant environmental benefits to the DR s safety and e RC, Zambia a, Zimbabw we and Sou uth Africa, r reduced roa ad and border congestion a n and decreased air p pollution,” Mr. Friedla and added.

“ “The reactiv vated spur line also w will provide e significan nt economic c and socia al benefits to resident ts o of Kipushi a and the sou uthern DRC C provinces s of Haut-K Katanga and d Lualaba, allowing fo or efficient transportation of supp plies to and d from the a area.

“ “Given Kipu ushi’s incre edible zinc grades of approxima ately 35% a and current t zinc prices s of betwee en d $1.50 a pound, we’r US$1.40 and re confiden nt that Kipushi is on tr rack to bec come the world’s U h highest-gra ade, major z zinc mine. Discussion ns are ongo oing with o our partner, , Gécamine es, and p prospective e project fin nanciers to

• fast-track completion of the rem maining inf frastructur re

d developmen nt at the mine.”

T The Kipush hi Mine is ow wned by Kipushi Corporation (K KICO), a join nt venture between Iv vanhoe Min nes Gécamines (32%). Kip African Copperbelt in (6 68%) and G pushi, on th he Central A n the provin nce of Haut t- Katanga, is approxima K ately 30 kilo ometres so outhwest of f Lubumba ashi and les ss than one e kilometre e from the int ternational border wit th Zambia.

M Maps show w Ivanhoe's Kipushi i and Kam moa-Kakula a projects, the railw way spur lin ne to Kipushi, the natio onal railwa ay and the internatio onal rail co orridor tha at links the e DRC r seaports at Durban C Copperbelt to major n and Rich hards Bay in South A Africa, Da ar es Salaa am in Tanzania and Lob bito in Ang gola. Inset shows th he Kipushi to Munam ma spur lin ne.

F Front-end d engineering design study to assess the sco ope and cost of rebuilding spur line

U Under the te erms of the e MOU, Ivan nhoe will appoint con nsultants to

• conduct a a front-end engineerin ng

d design stud dy to asses ss the scop pe and cost t of rebuilding the spu ur line from m the Kipus shi Mine to the main Lu ubumbashi-Sakania ra ailway at M Munama. Th he study is scheduled d to begin b before the year and construction e end of this y n on the Ki ipushi-Mun nama spur line could s start in late e 2018. Iv vanhoe will finance th he rebuildin ng.

development project, safe and re M Mr. Johanss son said th hat as with any mine d eliable tran nsportation n is for production at Kipu a a key consideration in n planning f ushi.

“ “This coope eration agr reement on n the railwa ay project is s similar to

• our succe essful, ongo oing

p partnership p with the D DRC’s state e-owned po ower compa any, La Soc ciété Nationale d’Elec ctricité, for the rehabilitation of th hree hydrop power plan nts to suppo ort our dev velopment o of the Kam moa-Kakula C Copper Pro oject.”

rth-south rail corridor M Mr. Johanss son added: “During the past five e years, the e 3,000-kilo ometre, nor r h has experie enced a rev vival in freig ght volume es between n South Africa and the e African Copperbelt. O Our decisio on to opt fo or rail as ou ur primary m mode of ex xport transp port will fur rther enhan nce the e economic s stability of t the railway y operators s along this s entire corridor. Given the large e and in ncreasing v volumes of f copper an nd cobalt b being expor rted from D DRC, we exp pect to see e more p private-pub blic coopera ation agree ements to r rebuild othe er sections s of the DRC C railway s system.”

H Heavy-gau uge rails and concre ete crossties (sleepe ers) being installed on a secti ion of SNCC’s ma ain line fro om Lubum mbashi to S Sakania, a at the Zambian borde er. The up pgrading, S financed b by the Wor rld Bank, u utilized cro ossties produced at t a Lubum mbashi plan nt. Similar r c componen nts will be used on the planne ed upgradi ing of the spur line t to the Kipushi Mine e.

E Existing po ortion of track on th he Kipushi i-Munama spur line to be rebu uilt as par rt of the plan nned upgra ading.

railway company an R Representatives of t the SNCC national r nd Ivanhoe e's Kipush hi team a at Munama a railway s station.

Kipushi underground upgrading program nearing completion

KICO has made excellent progress in modernizing the Kipushi Mine’s underground infrastructure as part of preparations for the resumption of commercial production. With the underground upgrading nearing completion, KICO’s focus now will shift to modernizing and upgrading Kipushi’s surface infrastructure to handle and process the mine’s high-grade zinc and copper resources.

The current mine redevelopment plan, as outlined in the May 2016 independent, preliminary economic assessment (PEA), has a two-year construction period with quick ramp-up to a projected, steady-state, annual production of 530,000 tonnes of zinc concentrate.

A pre-feasibility study (PFS) is underway to refine the findings of the PEA and to optimize the mine’s redevelopment schedule, life-of-mine operating costs and initial capital costs required to return the mine to production, taking into consideration the significant capital already invested to date on critical rehabilitation work. The PFS, which Ivanhoe expects to complete before the end of this year, will focus on the mining of Kipushi’s Big Zinc Deposit, which has an estimated 10.2 million tonnes of Measured and Indicated Mineral Resources grading 34.9% zinc. This exceptional grade is more than twice as high as the Measured and Indicated Mineral Resources of the world’s next-highest-grade, major zinc project, according to Wood Mackenzie, a leading, international industry research and consulting group.

In addition to the Big Zinc Deposit, Kipushi has several copper-rich zones that also contain silver, germanium and zinc. Measured and Indicated Mineral Resources contained in the copper-rich Série Récurrente Zone, Fault Zone, and Fault Zone Splay total 1.63 million tonnes at grades of 4.01% copper, 2.87% zinc and 22 g/t silver, at a 1.5% copper cut-off, containing 144 million pounds of copper. Inferred Mineral Resources in these zones total an additional 1.64 million tonnes at grades of 3.30% copper, 6.97% zinc and 19 g/t silver.

Qualified Person, Quality Control and Assurance

The scientific and technical information in this news release has been reviewed and approved by Stephen Torr, P.Geo., Ivanhoe Mines’ Vice President, Project Geology and Evaluation, a Qualified Person under the terms of National Instrument 43-101. Mr. Torr is not independent of Ivanhoe Mines.

Ivanhoe has prepared and filed a current, independent, NI 43-101-compliant technical report for the Kipushi Project, titled “Kipushi Zn-Cu Project, Kipushi 2016 Preliminary Economic Assessment”, dated May 2016, which is available under the company’s SEDAR profile at www.sedar.com and on the company’s website at www.ivanhoemines.com. The technical report includes relevant information regarding the effective dates and the assumptions, parameters and methods of the mineral resource estimates on the Kipushi Project cited in this release, as well as information regarding data verification, exploration procedures, sample preparation, analysis and security, and other matters relevant to the scientific and technical disclosure contained in this release regarding the Kipushi Project.

About Ivanhoe Mines

Ivanhoe Mines is advancing its three principal projects in Southern Africa: 1) mine development at the Platreef platinum-palladium-gold-nickel-copper discovery on the Northern Limb of South Africa’s Bushveld Complex; 2) mine development and exploration at the tier-one Kamoa-Kakula copper discovery on the Central African Copperbelt in the Democratic Republic of Congo; and 3) upgrading at the historic, high-grade Kipushi zinc-copper-silver-germanium mine, also on the Copperbelt in the DRC. For details, visit www.ivanhoemines.com.

Information contacts

Investors Media Bill Trenaman +1.604.331.9834 North America: Bob Williamson +1.604.512.4856 South Africa: Jeremy Michaels +27.82.772.1122

Website www.ivanhoemines.com

Cautionary statement on forward-looking information

Certain statements in this release constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws, including without limitation: (1) statements regarding Ivanhoe Mines’

commitment to rebuild 34 kilometres of track to connect the Kipushi Mine with the DRC national railway at Munama;

(2) statements regarding Kipushi’s projected annual output of approximately 530,000 tonnes of zinc concentrates;

(3) statements regarding a daily train from Kipushi will replace the equivalent of 50 road trucks, resulting in significant safety and environmental benefits to the DRC; (4) statements regarding the reactivated spur line also will provide significant benefits to residents of Kipushi and the provinces of Lualaba and Haut-Katanga; (5) statements regarding Ivanhoe’s expectations that Kipushi is on track to become the world’s highest-grade, major zinc mine; (6) statements regarding the front-end engineering design study is scheduled to begin before the end of this year and construction on the Kipushi-Munama spur line could start in late 2018; (7) statements regarding Ivanhoe’s expectation to see more private-public cooperation agreements to rebuild other sections of the DRC railway system; and (8) statements regarding Ivanhoe’s expectation to complete the Kipushi pre-feasibility study before the end of this year.

All such forward-looking information and statements are based on certain assumptions and analyses made by Ivanhoe Mines’ management in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors management believe are appropriate in the circumstances. These statements, however, are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information or statements including, but not limited to, unexpected changes in laws, rules or regulations, or their enforcement by applicable authorities; the failure of parties to contracts to perform as agreed; social or labour unrest; changes in commodity prices; unexpected failure or inadequacy of infrastructure, or delays in the development of infrastructure, and the failure of exploration programs or other studies to deliver anticipated results or results that would justify and support continued studies, development or operations. Other important factors that could cause actual results to differ from these forward-looking statements also include those described under the heading “Risk Factors” in the company’s most recently filed MD&A as well as in the most recent Annual Information Form filed by Ivanhoe Mines. Readers are cautioned not to place undue reliance on forward-looking information or statements. The factors and assumptions used to develop the forward-looking information and statements, and the risks that could cause the actual results to differ materially are set forth in the “Risk Factors” section and elsewhere in the company’s most recent Management’s Discussion and Analysis report and Annual Information Form, available at www.sedar.com.

This news release also contains references to estimates of Mineral Resources. The estimation of Mineral Resources is inherently uncertain and involves subjective judgments about many relevant factors. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. The accuracy of any such estimates is a function of the quantity and quality of available data, and of the assumptions made and judgments used in engineering and geological interpretation, which may prove to be unreliable and depend, to a certain extent, upon the analysis of drilling results and statistical inferences that may ultimately prove to be inaccurate. Mineral Resource estimates may have to be reestimated based on, among other things: (1) fluctuations in zinc or other mineral prices; (2) results of drilling; (3) results of metallurgical testing and other studies; (4) changes to proposed mining operations, including dilution; (5) the evaluation of mine plans subsequent to the date of any estimates; and (6) the possible failure to receive required permits, approvals and licences.

Although the forward-looking statements contained in this news release are based upon what management of the company believes are reasonable assumptions, the company cannot assure investors that actual results will be consistent with these forward-looking statements. These forwardlooking statements are made as of the date of this news release and are expressly qualified in their entirety by this cautionary statement. Subject to applicable securities laws, the company does not assume any obligation to update or revise the forward-looking statements contained herein to reflect events or circumstances occurring after the date of this news release.