Ivanhoe Mines issues second quarter 2023 financial results, and review of construction and exploration activities

August 3, 2023

Ivanhoe Mines issues second quarter 2023 financial results, and review of construction and exploration activities ■ Kamoa-Kakula Copper Complex sold 101,526 tonnes of payable copper in Q2 2023 and recognized record quarterly revenue of $702 million and EBITDA of $457 million ■ Ivanhoe Mines recorded Adjusted EBITDA of $172 million for Q2 2023, compared with $101 million for the same period in 2022 ■ Ivanhoe Mines recorded a quarterly profit of $87 million, driven by income from the Kamoa-Kakula joint venture of $123 million ■ Kamoa-Kakula’s quarterly cost of sales total $1.24 per lb. of payable copper; C1 cash costs of $1.41 per lb. at the lower end of guidance ■ Ivanhoe Mines announces significant preliminary testwork for improving copper recoveries at Kamoa-Kakula ■

Platreef progressing well towards Q3 2024 start-up; over 2,000 metres underground development completed

■

Ivanhoe Mines welcomes the inclusion of copper on the 2023 U.S. Department of Energy Critical Minerals List

JOHANNESBURG, SOUTH AFRICA – Ivanhoe Mines’ (TSX: IVN; OTCQX: IVPAF) President Marna Cloete and Chief Financial Officer David van Heerden are pleased to present the company’s financial results for the three and six months ended June 30, 2023. Ivanhoe Mines is a leading Canadian mining company developing and operating its four principal mining and exploration projects in Southern Africa: expanding the operations of the world-class Kamoa-Kakula Copper Complex in the Democratic Republic of Congo (DRC); building the tier- one Platreef palladium, rhodium, nickel, platinum, copper and gold development in South Africa; restarting the historic, ultra-high-grade Kipushi zinc-copper-lead- germanium mine in the DRC; as well as exploring the expansive exploration licences of Ivanhoe’s Western Foreland for copper discoveries adjacent to Kamoa-Kakula. All figures are in U.S. dollars unless otherwise stated.

Watch an August 2023 video highlighting Ivanhoe Mines’ construction and exploration activities: https://vimeo.com/850838953/163436ff95

FINANCIAL HIGHLIGHTS

• Ivanhoe Mines recorded a profit of $87 million for Q2 2023, net of a $27 million

non-cash loss on the $575 million convertible bond fair valuation, compared with a profit of $82 million for Q1 2023. The profit in the quarter includes Ivanhoe Mines’ share of profit and finance income from the Kamoa-Kakula joint venture of $123 million.

• Kamoa-Kakula sold 101,526 tonnes of payable copper during Q2 2023,

recognizing a record revenue of $702 million, an operating profit of $394 million and a quarterly EBITDA of $457 million.

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

$1.24/lb. for Q2 2023 compared with $1.25/lb. and $1.15/lb. in Q1 2023 and Q2 2022, respectively. Cash costs (C1) per pound of payable copper produced in Q2 2023 totaled $1.41/lb., compared to $1.42/lb. and $1.42/lb. in Q1 2023 and Q2 2022, respectively.

• Ivanhoe Mines Adjusted EBITDA was $172 million for Q2 2023, compared with

$101 million for the same period in 2022, and $172 million for Q1 2023.

• Since entering Phase 1 commercial production on July 1, 2021, the Kamoa-

Kakula joint venture has generated $1.82 billion of net cash from operating activities, which has funded both the Phase 2 and Phase 3 expansions to date.

• Ivanhoe Mines has a strong balance sheet with cash and equivalents of $393

million on hand as at June 30, 2023, and expects Kamoa-Kakula’s Phase 1 and Phase 2 cash flow to be sufficient to fund the Phase 3 expansion capital cost requirements at current copper prices.

• On May 22, 2023, Kipushi Corporation entered into a financing facility with

Rawbank SA, one of the largest financial institutions in the Democratic Republic of the Congo. Under the terms of the facility, Rawbank provided an $80 million loan, to be drawn down in two tranches of $40 million each. The first tranche has been drawn and will be used to fund Kipushi’s working capital requirements. The facility bears interest of 8% per annum.

• On April 27, 2023, Ivanhoe and joint-venture partner Gécamines, the DRC’s

state-owned mining company, announced an offtake term sheet for 100% of Kipushi’s zinc concentrate, together with a $250-million facility supported by Glencore International AG. The offtake and financing term sheet is subject to the execution of final, binding agreements, which are expected to be concluded in conjunction with the new Kipushi Corporation joint-venture agreement in the coming months.

• On June 15, 2023, Ivanhoe announced the replacement of an outstanding

$77.4-million loan receivable from High Power Exploration (HPX) with an equity investment in I-Pulse, its parent company, joining leading mining company BHP Group Limited as an investor. The company intends to enter into a collaboration agreement with I-ROX, an I-Pulse subsidiary, to investigate and develop applications for pulsed-power technology in the mining sector.

OPERATIONAL HIGHLIGHTS

• Record quarterly production of 103,786 tonnes of copper in concentrate was

achieved at Kamoa-Kakula for Q2 2023, compared with 93,603 tonnes in Q1 2023 and 87,314 tonnes in Q2 2022.

• Over the first six months of 2023, Kamoa-Kakula has produced a total of

197,389 tonnes of copper in concentrate, placing it well on track to deliver annual production guidance of between 390,000 – 430,000 tonnes of copper.

• Kamoa-Kakula's Phase 1 and 2 concentrators milled a record 2.2 million

tonnes of ore during the second quarter at an average feed grade of 5.2% copper. This included high-grade, run-of-mine ore from the Kakula Mine, supplemented with ore from the surface stockpiles to achieve throughput higher than original design capacity.

• On July 2, 2023, Kamoa-Kakula achieved a record daily milling rate of 29,968

dry metric tonnes, which is equivalent to an annual milling rate of 10 million tonnes per annum (after accounting for availability). For July, Kamoa-Kakula produced 35,636 tonnes of copper in concentrate, just short of a record, and achieved recoveries of 88%.

• Kamoa-Kakula's Phase 3 mine and concentrator expansion, 500,000-tonne-

per-annum on-site, direct-to-blister copper smelter and the refurbishment of Turbine #5 at the Inga II hydroelectric facility are advancing on schedule and are expected to be complete in late 2024. At current copper prices, it is expected that cashflow from Kamoa-Kakula’s Phase 1 and 2 operations will be sufficient to fund the remaining 2023 and 2024 expansion capital cost requirements of approximately $2.1 billion.

• On July 27, 2023, Ivanhoe announced significant preliminary test work for

improving copper recoveries at Kamoa-Kakula. In 2022, Kamoa Copper’s process engineering team, together with a number of internationally recognized external metallurgy specialists, initiated work to investigate ways to economically recover additional copper units from the tailings stream of the Phase 1 and 2 concentrators. Results to-date indicate a significant improvement in total recoveries can be achieved by liberating copper from the tailings stream, which would further increase production, revenues and cash flow.

• Ivanhoe continues its expansive copper exploration program on its Western

Foreland licences that cover approximately 2,407 square kilometres adjacent to Kamoa-Kakula. The 2023 exploration program is budgeted at approximately $19 million. A total of 37 holes and 10,853 metres were completed during Q2 2023, following the conclusion of the wet-season in May. A total of 15,736 metres of diamond core have been drilled in the first half of 2023.

• Ivanhoe is on schedule to publish a maiden Mineral Resource estimate for its

Makoko and Kiala high-grade copper discoveries in the Western Foreland in Q3 2023.

• Ivanhoe is undertaking optimization work to identify value-accretive options

for installing hoisting capacity to Platreef's Shaft 3, which was originally planned as a ventilation and secondary escape shaft. Shaft 3 is currently under construction and now is planned to be equipped for hoisting. Shaft 3 is currently being reamed to a diameter of 5.1 metres. Approximately, 340 metres of the total 950 metres have been reamed to date, with completion planned in Q4 2023. The additional hoisting capacity from Shaft 3 may be used to accelerate underground mining activities for Phase 2, in advance of the completion of Shaft 2, which is expected in 2027.

• Platreef underground development work is focused on lateral development

towards the high-grade Flatreef orebody on the 750-metre, 850-metre and 950- metre levels. More than 2,000 metres of lateral development has been completed to date across all three levels, advancing at a rate of approximately 200 metres per month. Once the crusher and loading feeder installation on the 950-metre level is completed at the end of August, the rate of lateral underground development is expected to increase to approximately 300 metres per month throughout the remainder of the year.

• Drilling of the pilot drill hole for the reaming of the 10-metre-diameter Shaft 2,

which commenced in February 2023, was completed during the quarter. Preparations are now underway to commence reaming of Shaft 2 to an initial diameter of 3.1 metres.

• At the Kipushi Mine, overall construction progress is approximately 50%

complete and construction of the concentrator is on schedule for commissioning in Q3 2024. The concentrator includes dense media separation and a milling and flotation circuit. Kipushi is expected to produce more than 270,000 tonnes of zinc contained in concentrate over the first five years of production.

• Kipushi's underground development activity is ahead of schedule, with 2,147

metres of lateral development completed since September 2022. Stoping of ultra-high-grade Big Zinc orebody is expected to begin in January 2024. The year-to-date underground development rate averages approximately 250 metres per month. The underground development rate is expected to increase to approximately 450 metres per month by year-end.

Christelle Nday (centre left) and Micheline Kyenge (centre right), President and Vice President of Kamoa's Women In Mining, conducted a tour of Kamoa-Kakula for a group of Grade 10 students from the nearby Mutoshi Technical Institute. The students are pictured in front of a 21-tonne underground loader at the Kansoko Mine portals.

Conference call for investors on Thursday, August 3, 2023

Ivanhoe Mines will hold an investor conference call to discuss its 2023 second- quarter financial results at 3:30 p.m. London time / 10:30 a.m. Eastern time / 7:30 a.m. Pacific time on Thursday, August 3. The conference call will conclude with a question-and-answer (Q&A) session. Media are invited to attend on a listen-only basis.

To view the webcast please use the following link: https://edge.media- server.com/mmc/p/3envh996

Analysts are invited to join by phone for the Q&A using the following link: https://register.vevent.com/register/BI41a67c7e4bc743e7975234c0ae560d1a

An audio webcast recording of the conference call, together with supporting presentation slides, will be available on Ivanhoe Mines’ website at www.ivanhoemines.com.

After issuance, the Financial Statements and Management’s Discussion and Analysis will be available at www.ivanhoemines.com and www.sedarplus.ca.

Read Ivanhoe's Second Quarter 2023 Sustainability Update:

https://ivanhoemines.com/site/assets/files/3775/sustainability-review- q2-2023.pdf

Construction of the off-gas handling structure and the adjoining furnace building at Kamoa-Kakula’s direct-to-blister copper smelter.

Principal projects and review of activities

1. Kamoa-Kakula Copper Complex

39.6%-owned by Ivanhoe Mines Democratic Republic of Congo

The Kamoa-Kakula Copper Complex is approximately 25 kilometres southwest of the town of Kolwezi and about 270 kilometres west of Lubumbashi in the DRC Copperbelt. Kamoa-Kakula’s Phase 1 concentrator began producing copper in May 2021 and achieved commercial production on July 1, 2021. The Phase 2 concentrator, which doubled nameplate production capacity, was commissioned in April 2022. Kamoa- Kakula is independently ranked by international mining consultant Wood Mackenzie to become the world’s third-largest copper mining operation in 2027, following the completion of the ongoing Phase 3 expansion. Kamoa-Kakula’s employee workforce is currently 97% Congolese.

The Kamoa-Kakula Copper Complex is operated as the Kamoa Holding joint venture between Ivanhoe Mines and Zijin Mining. 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. Ivanhoe and Zijin Mining each hold an indirect 39.6% interest in Kamoa-Kakula, Crystal River holds an indirect 0.8% interest, and the DRC government holds a direct 20% interest.

Kamoa-Kakula summary of operating and financial data

Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022

Ore tonnes milled (000’s tonnes) 2,006 2,082 1,950 2,244 1,930

Copper ore grade processed (%)	5.21%	5.42%	5.40%	5.60%	5.44%
Copper recovery (%)	87.2%	87.1%	86.1%	85.9%	84.0%
Copper in concentrate produced	103,786	93,603	92,761	97,820	87,314

(tonnes)

Payable copper sold (tonnes)	101,526	86,777	92,208	93,812	85,794
Cost of sales per pound ($ per lb.)	1.24	1.25	1.08	1.05	1.15
Cash cost (C1) ($ per lb.)	1.41	1.42	1.42	1.43	1.42
Realized copper price ($ per lb.)	3.79	4.04	3.54	3.50	4.34

Sales revenue before 729,924 659,529 619,997 570,504 699,381

remeasurement ($'000)

Remeasurement of contract (27,542) 29,594 53,473 (110,031) (205,248)

receivables ($'000)

Sales revenue after remeasurement 702,382 689,123 673,470 460,473 494,133

($'000)

EBITDA ($'000)⁽¹⁾ 456,628 457,311 452,089 251,086 285,477 EBITDA margin (% of sales revenue) 66% 67% 55% 58%

65%

All figures in the above tables are on a 100%-project basis. Metal reported in concentrate is before refining losses or deductions associated with smelter terms. This news release includes “EBITDA”, “Adjusted EBITDA”, “EBITDA margin”, normalized profit and "Cash costs (C1)" which are non- GAAP financial performance measures. For a detailed description of each of the non-GAAP financial performance measures used herein and a detailed reconciliation to the most directly comparable measure under IFRS, please refer to the non-GAAP Financial Performance Measures section of this news release starting on page 52.

(1) Unrealized foreign exchange losses have been excluded from EBITDA in the current and prior periods presented, as the Company believes that including the unrealized foreign exchange gains and losses does not give a valuable indication of the mine’s ability to generate liquidity by producing operating cash flow to fund its working capital needs, service debt obligations, fund capital expenditures and distribute cash to its shareholders.

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

Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q2 2022

Mining	($ per lb.)	0.39	0.41	0.40	0.41	0.39
Processing	($ per lb.)	0.19	0.19	0.16	0.12	0.14
Logistics charges (delivered to ($ per lb.)		0.45	0.46	0.50	0.56	0.51

China)

Treatment, refining and smelter ($ per lb.) 0.25 0.23 0.23 0.21 0.21 charges General and administrative ($ per lb.) 0.13 0.13 0.13 0.13 0.17 expenditure

C1 cash cost per pound of ($ per lb.) 1.41 1.42 1.42 1.43 1.42 payable copper produced

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 include all direct mining, processing, and general and administrative costs. Smelter charges and freight deductions on sales to the 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 non-routine charges as they are not direct production costs.

All figures are on a 100% project basis and metal reported in concentrate is before refining losses or deductions associated with smelter terms.

(L-R) Guelord Ilunga, control room overseer; Derick Yav Tshang, control room overseer; Carine Ndala, control room overseer; Jean-Saint Kabange, plant metallurgist; Dan Mutamba, senior control room officer; and Chris Tshibanda, control room overseer, stand in the Kamoa-Kakula concentrator plant control room.

Kamoa-Kakula produced a record 103,786 tonnes of copper in Q2 2023, including a monthly record of 35,856 tonnes for May 2023

Kamoa-Kakula's Phase 1 and 2 concentrators are now regularly operating at the increased processing rate of 9.2 million tonnes per annum (Mtpa), following the completion of the debottlenecking program. The $50-million Phase 1 and 2 concentrator debottlenecking program was completed on budget and ahead of schedule in late February 2023, increasing production capacity up to 450,000 tonnes of copper in concentrate per annum.

The Kamoa-Kakula Phase 1 and Phase 2 concentrators continued to perform strongly in the second quarter, breaking several records including the quarterly production of 103,786 tonnes of copper in concentrate, a quarter-on-quarter increase of 11%. In addition, a monthly record was achieved in May 2023 with 35,856 tonnes of copper in concentrate produced. Also, during the quarter, a weekly production record of 9,710 tonnes of copper in concentrate was achieved in late April. Shortly after quarter-end, on July 2, 2023, a record daily milling rate of 29,968 dry metric tonnes was achieved, which is equivalent to an annual milling rate of 10 million tonnes per annum (after accounting for availability).

Kamoa-Kakula's Phase 1 and 2 concentrators milled a record 2.2 million tonnes of ore during the second quarter at an average feed grade of 5.2% copper. This included highgrade, run-of-mine ore from the Kakula Mine, supplemented with ore from the surface stockpiles to achieve throughput over original design capacity. Strong copper recoveries continued for the quarter averaging 87.2%.

For July, Kamoa-Kakula’s Phase 1 and 2 concentrators milled 0.6 million tonnes of ore at an average feed grade of 5.8% copper and recoveries of 88.0%, producing 35,636 tonnes, just short of a monthly record.

The record second-quarter production at Kamoa-Kakula was achieved despite maintenance shutdowns in June and intermittent grid instability.

Since late Q4 2022, Kamoa Copper has been working alongside DRC’s state-owned power company, La Société Nationale d’Electricité (SNEL), to identify the causes of instability across the southern DRC’s grid infrastructure to assist with delivering longlasting solutions. Kamoa Copper has identified a series of upgrades and has outlined a project plan to deliver the improvements. Mobilization of resources is underway, with vendor selection and equipment procurement having commenced.

Concurrently, Kamoa Copper’s engineering team are working towards insulating Kamoa-Kakula from future instability by expanding on-site backup generation capacity, as well as sourcing additional power imported from the Zambian grid.

Over the next 12-18 months, on-site backup-power generation capacity will increase via a phased roll-out. During the second quarter, 11 megawatts (MW) of new generator capacity was installed, bringing the total on-site backup-power generation capacity to approximately 48 MW. Delivery of a further 30 MW in backup generation capacity, sufficient to power Kamoa-Kakula’s entire Phase 1 and 2 operations in the event of grid disruptions, will commence later this year and is expected to be operational by Q2 2024. Over 130 MW of further backup generation capacity has been ordered and is expected to be installed in 2024, in time for the completion of the Phase 3 concentrator and smelter that are currently under construction.

Discussions are advancing to secure up to 100 MW of additional power via the Zambian grid interconnector, with the initial phase expected to be ready in the third quarter.

Draw-down of surface ore stockpiles at Kakula continues as required. While the ongoing expansion of underground infrastructure at the Kakula mine takes place, ore will be drawn as required from the stockpile to maximize copper production.

Kamoa-Kakula’s high- and medium-grade ore surface stockpiles totaled approximately 4.1 million tonnes at an estimated grade of 3.7% copper as of the end of June 2023 and contained more than 152,000 tonnes of copper. The operation mined 2.2 million tonnes of ore grading 5.2% copper in Q2 2023, which was comprised of 2.0 million tonnes grading 5.4% copper from the Kakula mine, including 0.68 million tonnes grading 7.0% copper from the mine’s high-grade centre.

Jurie Human, civil supervisor, Kamoa Copper and Julias Mblambo, site foreman with DRC-based contractor Kongo River Construction, study schematics underground at the Kakula Mine.

Significant preliminary testwork for improving copper recoveries at Kamoa-Kakula

On July 27, 2023, Ivanhoe announced highly promising preliminary testwork to further improve copper recoveries at Kamoa-Kakula by liberating copper from the tailings stream by a conventional process of fine-grinding the material followed by flotation, thickening and filtration. Initial preliminary results indicate that with a feed grade of less than 1% copper, approximately 65% of the contained copper can be recovered from the tailings stream, which could increase overall metallurgical recoveries to well over 90%. Based on these results, Kamoa-Kakula can further increase production, revenues and cash flow.

In 2022, Kamoa Copper’s process engineering team, together with a number of internationally recognized external metallurgy specialists, initiated work to investigate ways to economically recover additional copper units from the tailings stream of the Phase 1 and 2 concentrators. There are 13 workstreams underway, including the process described above, which is subject to further metallurgical testwork and engineering work, to advance the project to an investment decision.

For context, in 2022 the Kamoa-Kakula Copper Complex milled approximately 7.1 million tonnes of ore at an average feed grade of 5.5% copper, producing 333,497 tonnes of copper in concentrate. Based on the metallurgical recovery of 86% copper, which was in line with design parameters, more than 50,000 tonnes of copper was not recovered into concentrate and diverted to the tailings storage facility, or used underground as backfill. The grade of Kamoa-Kakula’s tailings in 2022 averaged approximately 0.8% copper. For comparison, the average head grade of the copper mines globally was approximately 0.6% in 2022, according to Bank of Montreal (BMO) research. See Figure 1.

Figure 1. Global average copper head grade since 2000, compared with the average copper grade of Kamoa-Kakula’s tailings during 2022.

Source: BMO Research, Wood Mackenzie