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Friedland confident Congo copper mine will be world’s second-largest

Billionaire Robert Friedland, founder and executive chairman of Ivanhoe Mines (TSX:IVN), said Wednesday his copper project with Chinese partners, Zijin Mining Group and Crystal River Global, in the Democratic Republic of Congo “definitely” has the potential to become the world’s second-largest red metal mine.

“Kamoa-Kakula will become the world’s second-largest copper mine with peak annual production of more than 700,000 tonnes of copper metal,” Friedland said in a release announcing the results of an independent pre-feasibility study (PFS) for the project.

The mining veteran, who made his fortune from the Voisey’s Bay nickel project in Canada in the 1990s, said the capacity of the project’s first phase, estimated in 6 million tonnes of ore a year, could later be tripled.

Initial mine grades at Kamoa-Kakula, the PFS shows, will average 6.8% copper over the initial five years, and 6.4%in the first decade, with production starting in early 2021. First, Friedland needs to raise more than $1.1 billion, but he said he’s already in talks with China-based financial institutions.

“The mine is getting built,” Friedland said. “The first operation will be able to finance two further mines and a smelter (…) That is mind-boggling and we’ve never seen that before.”

Ivanhoe Mines has been working on Kamoa-Kakula for ten years with its Chinese joint-venture partner Zijin Mining — which acquired a stake in the Canadian miner in 2015 through a wholly-owned subsidiary — and the Congolese government. The project is also backed by China’s state-owned Citic Metal, Ivanhoe’s largest shareholder.

Friedland’s words didn’t come as a surprise for those following the project progress. Only last week, Ivanhoe announced what it called an “unprecedented” intersection in a shallow, flat lying deposit at asset.

For Paul Gait, analyst at Sanford C. Bernstein, the results from drill hole DD1450 at Kamoa North were “nothing short of extraordinary.” In a note to investors, he said the released figures show higher copper grades than the 0.5% to 0.6% detected at Anglo American’s Quellaveco project in Peru or Teck Resources’ QB2 project in Chile.

They confirm, he said, that “the broader Kamoa-Kakula region is by far the most important and exciting mining project in the world today.”

If fully developed the mining complex could produce 382,000 tonnes of copper a year during the first 10 years, climbing to 700,000 tonnes of copper after 12 years of operations. More importantly, Friedland said, Kamoa-Kakula could restore the DRC to its historical position as one of the world’s top copper producing countries.

Shares in Ivanhoe skyrocketed on the news, trading 10.7% higher in Toronto to C$3.05 shortly at 9:35 am local time.

Year-to-date, the stock is up about 27%, valuing the company at about C$3.3 billion ($2.5B).

News No: 3580
Date: 2019/02/06 - 23:10
News Source: MINING.COM

copper mine  Congo  Zijin Mining Group  metal  definitely 

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