Ivanhoe Mines issues first quarter 2022 financial results, as well as review of mine construction and exploration activities

May 10, 2022

Ivanhoe Mines issues first quarter 2022 financial results, as well as review of mine construction and exploration activities ■ Kamoa-Kakula Copper Mining Complex in the Democratic Republic of Congo sold 51,919 tonnes of payable copper and recognized record revenue of $519.6 million in Q1 2022 ■ The Kamoa-Kakula joint venture recorded record EBITDA of $399.4 million, and operating profit of $380.5 million for Q1 2022 ■ Kamoa-Kakula’s cost of sales total $1.08 per pound of payable copper in Q1 2022, with C1 cash costs trending towards lower end of 2022 guidance at $1.21 per pound ■ Kamoa-Kakula Phase 2 offtake agreements concluded ■ Regional exploration drill campaign commences at the Western Foreland Copper Project in the Democratic Republic of Congo ■ Kamoa-Kakula positioned to be the world’s third-largest copper producer by Q4 2024, with projected annualized copper output of approximately 600,000 tonnes

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Ivanplats completes Platreef's Shaft 1 changeover to a production shaft, commences lateral mine development toward Flatreef orebody

HIGHLIGHTS

• Ivanhoe Mines recorded a profit of $21.5 million for Q1 2022, compared to a profit

of $20.4 million for the same period in 2021. Ivanhoe Mines’ share of profit from the Kamoa-Kakula copper joint venture and finance income therefrom totaling $115.4 million, were the principal contributors to the profit recorded in the first quarter.

• The Kamoa-Kakula Mining Complex set a new quarterly production record during

the period, with 55,602 tonnes of copper in concentrate produced. Commercial production from the Phase 2 concentrator was declared on April 7, 2022.

• A de-bottlenecking program is underway at Kamoa-Kakula to expand processing

capacity of Phase 1 and Phase 2 concentrators by 21%, to a combined 9.2 million tonnes of ore per year. Copper production from Kamoa Copper’s first two phases is projected to exceed 450,000 tonnes per year by Q2 2023.

• Kamoa-Kakula’s cost of sales per pound (lb.) of payable copper sold was $1.08/lb.

for Q1 2022, while cash costs (C1) per pound of payable copper produced totaled $1.21/lb., compared to $1.12/lb. and $1.28/lb. respectively in Q4 2021.

• During Q1 2022, Kamoa-Kakula sold 51,919 tonnes of payable copper and

recognized record EBITDA of $399.4 million and revenue of $519.6 million, with an operating profit of $380.5 million.

• On May 3, 2022, Ivanhoe Mines announced details of the Phase 3 expansion at

Kamoa-Kakula, which will include an additional 5-million-tonnes-per-annum concentrator adjacent to new underground mines at Kamoa – named Kamoa 1 and Kamoa 2. Phase 3 will increase total processing capacity to more than 14 million tonnes of ore per annum, and grow annualized copper production to approximately 600,000 tonnes by the fourth quarter of 2024. This production level will elevate Kamoa-Kakula to the world’s third-largest copper mining complex, and the largest copper mining complex in Africa.

• Ivanhoe Mines has a strong balance sheet with cash and cash equivalents of $562

million as at March 31, 2022, and expects that Kamoa-Kakula’s expansion capital for Phase 2 and Phase 3 will be funded from copper sales and facilities at Kamoa.

• During the first quarter of 2022, Ivanhoe commenced a regional drilling program,

expected to total approximately 95,000 metres, targeting Kamoa-Kakula-style copper mineralization on its Western Foreland licences, which cover approximately 2,407 square kilometres in close proximity to the Kamoa-Kakula mining licenses.

• Exploration models that successfully led to the discoveries of Kakula, Kakula West,

and the Kamoa North Bonanza Zone on the Kamoa-Kakula joint-venture mining licence are being applied to the extensive Western Foreland land package by the team of exploration geologists responsible for the previous discoveries.

• On May 9, 2022, Ivanhoe Mines announced the completion of the Platreef Project's

Shaft 1 changeover to a production shaft, as well as the first blast on the 950-metre level, which marked the commencement of lateral mine development toward the high-grade Flatreef platinum-group-metals, nickel, copper and gold orebody.

• In February 2022, Ivanhoe Mines announced the outstanding results of a new

independent feasibility study for the Platreef Project that builds on the alternate scenario to expedite production, based on a steady-state production rate of 5.2 million tonnes per annum, confirming the viability of a new phased-development pathway to fast track Platreef into production in Q3 2024.

• The Platreef 2022 Feasibility Study yields an after-tax NPV8% of $1.7 billion and IRR

of 18.5% at long-term consensus metal prices. At spot prices as at May 6, 2022, the after-tax NPV8% increases to $3.5 billion and the IRR increases to 27%.

• In February 2022, Ivanhoe Mines and Gécamines signed a new agreement to return

the ultra-high-grade Kipushi Zinc Mine back to commercial production.

• Ivanhoe Mines announced the positive findings of an independent feasibility study

for the planned resumption of commercial production at Kipushi based on a two- year construction timeline. The Kipushi feasibility study’s sensitivity analysis at spot zinc prices of approximately $1.70/lb. (May 6, 2022), results in an after-tax NPV8% of $2.4 billion with an after-tax real IRR of 75.8%.

• On May 2, 2022, Ivanhoe Mines issued its fifth annual Sustainability Report,

highlighting the company’s commitment to becoming a global ESG leader in mining.

Conference call information

Ivanhoe Mines will hold an investor conference call to discuss the Q1 2022 financial results at 4:30 p.m. South African time / 10:30 a.m. Eastern time / 7:30 a.m. Pacific time on May 10. The conference call dial-in is +1-647-794-4605 or toll free 1-888-204-4368, quote “Ivanhoe Mines Q1 2022 Financial Results” if requested. Media are invited to attend on a listen-only basis.

Link to join the live audio webcast: https://bit.ly/3DTATay

Principal projects and review of activities

1. Kamoa-Kakula Mining Complex

39.6%-owned by Ivanhoe Mines Democratic Republic of Congo

The Kamoa-Kakula Mining Complex, a joint venture between Ivanhoe Mines and Zijin Mining, has been independently ranked as the world’s fourth-largest copper deposit by international mining consultant Wood Mackenzie. The project is approximately 25 kilometres west of the town of Kolwezi and about 270 kilometres west of Lubumbashi. Kamoa-Kakula began producing copper in May 2021 and achieved commercial production on July 1, 2021.

Ivanhoe sold a 49.5% share interest in Kamoa Holding Limited (Kamoa Holding) to Zijin Mining and a 1% share interest in Kamoa Holding to privately owned Crystal River in December 2015. Kamoa Holding holds an 80% interest in the project. Since the conclusion of the Zijin transaction, each shareholder has been required to fund expenditures at Kamoa-Kakula in an amount equivalent to its proportionate shareholding interest. Ivanhoe and Zijin Mining each hold an indirect 39.6% interest in the Kamoa-Kakula Mining Complex, Crystal River holds an indirect 0.8% interest and the DRC government holds a direct 20% interest.

Kamoa-Kakula’s Phase 1 and Phase 2 concentrator plants now are in commercial production.

Health and safety at Kamoa-Kakula

At the end of March 2022, Kamoa-Kakula reached 796,966 work hours free of a lost-time injury. Three lost-time injuries occurred in Q1 2022. The project continues to strive toward its workplace objective of zero harm to all employees and contractors.

Kamoa-Kakula has successfully focused on prevention, preparation, and mitigation in managing the risks associated with COVID-19. Large-scale testing, combined with focused preventative measures, ensured that positive cases were quickly identified, isolated, and treated, with cross contamination kept to a minimum. Kamoa-Kakula also continues to focus intensively on rolling out vaccinations across the workforce and local communities. More than two thousand employees have received at least one dose of the vaccine.

As the pandemic evolves, the medical team at the Kamoa-Kakula hospital continues to review and update risk-mitigation protocols to protect the health and safety of employees and community members.

Nursing staff inside the new medical facility at the Kamoa Hospital. (L-R) Alain Sambwe Masengo; Papy Wedialumbele Lumasa; Paulin Mwanza Umbanga; Augustin Kabedi Mujinga; Adellard Muyambo Kazenga; Salva Mujinga Tshibamba; Timothee Bwana Ngoie.

Johnny Masonga Mumba, Mine Safety Officer, receives a COVID-19 vaccination.

Kamoa-Kakula summary of operating and financial data

This release includes EBITDA and "C1 cash costs per pound" which are non-GAAP financial performance measures. For a detailed description of each of the non-GAAP financial performance measures used in this release, and a detailed reconciliation to the most directly comparable measure under IFRS, please refer to the Non-GAAP Financial Performance Measures section of this release and to the company’s MD&A for the three months ending March 31, 2022. C1 cash costs are prepared on a basis consistent with the industry standard definitions by Wood Mackenzie cost guidelines, but are not measures recognized under IFRS. In calculating the C1 cash cost, the costs are measured on the same basis as the company's share of profit from the Kamoa Holding joint venture that is contained in the financial statements. C1 cash costs are used by management to evaluate operating performance and includes all direct mining, processing, and general and administrative costs. Smelter charges and freight deductions on sales to final port of destination, which are recognized as a component of sales revenues, are added to C1 cash cost to arrive at an approximate cost of delivered, finished metal. C1 cash costs exclude royalties and production taxes and nonroutine charges, as they are not direct production costs.

C1 cash cost per pound of payable copper produced can be further broken down as follows:

Q1 2022 Q4 2021 Q3 2021

C1 cash cost per pound of payable ($ per copper produced lb) 1.21 1.28 1.37

All figures in the above tables are on a 100%-project basis. Metal reported in concentrate is prior to refining losses or deductions associated with smelter terms.

Record quarterly production of 55,602 tonnes of copper in Q1 2022; Phase 2 concentrator declared commercial production on April 7, 2022

First ore was introduced into the Phase 2 milling circuit on March 21, 2022, and first copper concentrate was produced approximately four months ahead of the originally announced development schedule. The Phase 2 concentrator plant is a mirror image of the Phase 1 plant, with a design throughput of 475 dry tonnes per hour, or 3.8 million tonnes of ore per year. Over the last six months, the Phase 1 plant has consistently exceeded design ore throughput by approximately 10% to 15%.

During the first 17 days of production, Phase 2 regularly exceeded its design throughput capacity, and continues to perform at similar throughput and recovery rates to the Phase 1 concentrator. Commercial production from the Phase 2 concentrator was declared on April 7, 2022.

Copper recoveries progressively increased from an average of approximately 81% in July 2021 to approximately 85% in September 2021. Copper flotation recoveries averaged approximately 86% in the fourth quarter of 2021 and achieved a record 88.5% in December 2021. The Phase 1, steady-state-design copper recovery is approximately 86%, depending on ore feed grade.

The Phase 1 concentrator currently is running at a throughput that is in excess of its design capacity of 3.8 million tonnes per annum by more than 15%, with 117% of design throughput achieved in December.

Kamoa-Kakula set a new quarterly production record in the first quarter of 2022 with 55,602 tonnes of copper in concentrate produced, up from the 54,481 tonnes of copper in concentrate produced in the fourth quarter of 2021 and 41,545 in the third quarter of 2021. A total of 1.08 million ore tonnes were milled during the first quarter of 2022 at an average feed grade of 5.91% copper.

An aerial view of Kamoa-Kakula's Phase 2 concentrator warehouse and tarping shed.

Augustine Kapenga, Health and Safety Officer, inspects construction of the Kakula North truck tip.

Phase 3 expansion to include additional 5 million-tonne-per-annum concentrator, adjacent to two new underground mines

Engineering and early works for the Phase 3 expansion, including a new box cut and twin declines to access new mining areas, are progressing quickly. Kamoa-Kakula's Phase 3 will consist of two new underground mines known as Kamoa 1 and Kamoa 2, as well as the initial decline development at Kakula West. A new, 5 million-tonne-per-annum concentrator (Mtpa) plant will be established adjacent to the two new mines at Kamoa.

Upon commencement of Phase 3 production, Kamoa Copper will have a total processing capacity greater than 14 million tonnes per annum. The existing Phase 1 and 2 concentrators will be de-bottlenecked and operating at a combined throughput of 9.2 million tonnes of ore per year by the second quarter of 2023, which will increase annual copper production to approximately 600,000 tonnes.

Phase 3 is making solid progress, with detailed design, budgeting and engineering advancing well. Construction on the new box cut excavation is advancing rapidly at the Kamoa 1 and Kamoa 2 mines, with decline development expected to start in early May 2022, which will provide access to the main Phase 3 mining areas.

The pre-feasibility study for the Phase 3 expansion is well advanced and expected to be announced during the second half of this year, while first production is anticipated to commence by the end of 2024.

Construction progress on the new box cut and twin declines excavation is advancing quickly at the Kamoa 1 and Kamoa 2 mines.

Figure 1: Kamoa-Kakula’s base-case, pro-forma Phase 3 copper production (after Phase 1 and 2 de-bottlenecking is complete) relative to the world’s projected top 10 producing mines in 2022 by paid copper production.

Source: company filings, Wood Mackenzie (April 2022). Note: Kamoa-Kakula production of 600 kt copper in concentrate is based on expected Phase 1, 2 and 3 steady state production, following de-bottlenecking of both Phase 1 and 2 concentrators, and commercial ramp-up of the Phase 3 concentrator.

Kamoa-Kakula smelter basic engineering and earthworks underway

Early works on the planned direct-to-blister flash smelter at Kamoa-Kakula adjacent to the Phase 1 and Phase 2 concentrator plants is underway. The smelter is designed to use technology supplied by Metso Outotec of Espoo, Finland, and has been sized to process the bulk of the copper concentrate forecast to be produced by the Phase 1, 2 and 3 concentrator plants, with a production capacity of 500,000 tonnes per annum of approximately 99%-pure blister copper.

China Nerin Engineering Company Co., Ltd. has been appointed to carry out the basic engineering design and develop a control budget estimate for the smelter with some early works engineering and procurement activities running in parallel. Work is progressing well and tenders for all long lead item have been issued to the market.

The smelter, once in operation, will enable Kamoa-Kakula to reduce its C1 cash costs per pound of payable copper produced by approximately 10% to 20%, driven by significantly reduced transportation costs, decreasing overall volumes shipped by more than half.

Early works on the direct-to-blister flash smelter at Kamoa-Kakula adjacent to the Phase 1 and Phase 2 concentrator plants is underway.

Yann Kabeya Mubela, mining supervisor, Kamoa Copper, stands in the new box cut and twin declines excavation site.

Ore stockpiles now hold more than 4.8 million tonnes grading 4.57% copper, containing more than 220,000 tonnes of copper at the end of March 2022

Kamoa-Kakula’s total high- and medium-grade ore surface stockpiles totaled approximately 4.8 million tonnes at an estimated grade of 4.57% copper as of the end of March 2022. The operation mined 1.67 million tonnes of ore grading 5.29% copper in Q1 2022, which was comprised of 1.53 million tonnes grading 5.50% copper from the Kakula Mine, including 0.65 million tonnes grading 6.90% copper from the mine’s high-grade centre, and 0.14 million tonnes grading 3.08% copper from the Kansoko Mine.

Kamoa-Kamoa’s Phase 1 and Phase 2 concentrator plants and the ore stockpiles at the Kakula Mine’s northern decline. The direct-to-blister flash smelter is being constructed adjacent to the Phase 1 and Phase 2 concentrator plants.

Kamoa-Kakula Phase 2 off-take amendments signed

Kamoa Copper – the operating company of the joint venture between Ivanhoe Mines, Zijin Mining Group, Crystal River and the Government of the Democratic Republic of Congo – has signed amended copper concentrate and blister copper offtake agreements on competitive arm's-length commercial terms, for 100% of Kamoa-Kakula’s Phase 1 and 2 copper output.

The amended terms of the existing offtake agreements with CITIC Metal (HK) Limited (CITIC Metal) and Gold Mountains (H.K.) International Mining Company Limited, a subsidiary of Zijin, extend to include 50% each of the copper products from Kamoa-Kakula’s Phase 2 production, in addition to Phase 1 production currently under offtake. The offtake agreements are