Ivanhoe Mines completes construction of Kamoa-Kakula’s Phase 3 concentrator ahead of schedule and on budget
May 28, 2024
Ivanhoe Mines completes construction of Kamoa-Kakula’s
Phase 3 concentrator ahead of schedule and on budget
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First ore to Phase 3 concentrator achieved on May 26; first
Phase 3 concentrate expected in early June
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Phase 3 concentrator increases Kamoa-Kakula copper
production capacity to more than 600,000 tonnes per annum,
making Kamoa-Kakula the fourth-largest copper mining
complex globally
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Further Kamoa-Kakula growth initiatives in progress, including
Project 95, de-bottlenecking of Phase 3 and potential
acceleration of Phase 4 expansion
■
Zero lost-time injuries recorded during the construction of the
Phase 3 concentrator
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Phase 1 and 2 concentrators produced more than 63,000
tonnes of copper since start of April; a significant improvement
resulting from improved power stability
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Kamoa-Kakula’s 2024 production guidance maintained at
440,000 to 490,000 tonnes of copper in concentrate
KOLWEZI, DEMOCRATIC REPUBLIC OF CONGO – Ivanhoe Mines (TSX: IVN;
OTCQX: IVPAF) Executive Co-Chair Robert Friedland and President Marna Cloete
announce today that on May 26, 2024, first ore was fed into the Phase 3
concentrator at the Kamoa-Kakula Copper Complex in the Democratic Republic of
the Congo (DRC). First ore marks the completion of construction of the Phase 3
concentrator, which has been achieved months ahead of schedule and also on
budget. First concentrate is expected in early June, while ramp-up to commercial
production is targeted for early in the third quarter.
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Ivanhoe Mines’ Founder and Executive Co-Chairman Robert Friedland
commented:
“The Kamoa-Kakula operations team continues its industry-leading execution
with the early and on-budget delivery of the Phase 3 concentrator and
underground mining operations ... a rare feat in an industry plagued by cost
overruns and delays when it comes to complex, world-scale projects. Meanwhile,
we have experienced much-improved power stability over the second quarter
following our team's proactive response to grid instability experienced in the
southern DRC grid. As a result, we've seen materially higher head grades and
improved production over the past two months. We expect a stronger second
quarter from Kamoa-Kakula's operations, reinforcing our confidence that
production will align with annual guidance.
“Given the outperformance of Kamoa-Kakula's operations to date, including
higher than expected throughput and recoveries at the Phase 1 and Phase 2
concentrators, we are now studying options to boost copper production towards
our next goal of 800,000 tonnes per annum ... a production rate that would propel
the Kamoa-Kakula Copper Complex towards being one of the two largest copper
producers on our planet. In addition to the de-bottlenecking of the Phase 3
concentrator and increasing recoveries to 95% via our 'Project 95' initiative, we
are now also studying options to accelerate the Phase 4 expansion at Kamoa-
Kakula to target a throughput rate of at least 20 million tonnes annually. Given the
current copper market, and the expansive copper resources and reserves in
proximity of the milling complex, we believe this expanded throughput rate would
unlock substantial value for our stakeholders and shareholders in the near and
long term.
“It is only early days in terms of the broader copper growth story at Ivanhoe
Mines, with our aggressive 70,000-metre drill program at our adjoining, majority-
owned Western Foreland licenses … which is now ramping up into the dry
season with 10 drill rigs active. Given that our current Western Foreland
resources already total nearly 5 million tonnes contained copper, we also intend
to assiduously advance the Makoko, Kiala and Kitoko discoveries towards early
production to underpin the further expansion of our copper business.”
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Kamoa-Kakula celebrated the first feed of ore into the ball mills of the new
Phase 3 concentrator on May 26, 2024.
Kamoa Copper’s projects and operations team standing in front of the new
Phase 3 concentrator. The Phase 3 operations team have been trained on
Phase 1 and 2 concentrators, which have a similar process design.
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The Phase 3 concentrator will process ore from the adjacent Kamoa 1 and 2
underground mines, as well as the connecting Kansoko underground mine. The
design capacity of the Phase 3 concentrator is 30% larger than the original design
capacities of the Phase 1 and 2 concentrators, which are located approximately
10 kilometres to the south. The process design of all three concentrators is
comparable, therefore the bulk of the equipment is the same or similar, resulting
in a commonality of spare parts, while also leveraging operational and
maintenance experience.
The Phase 3 concentrator increases the total design processing capacity of the
Kamoa-Kakula Copper Complex to 14.2 million tonnes per annum (Mtpa). Phase 3
is expected to increase annualized copper production to more than 600,000
tonnes, positioning Kamoa-Kakula as the world’s fourth-largest copper mining
complex, and the largest copper mine on the African continent. See Figure 1.
Figure 1. World’s top 10 copper mines estimated for 2025, by paid copper
production per annum
Source: Wood Mackenzie, 2023 (based on public disclosure and the Kamoa-Kakula Phase 3 annualized
production estimate of approx. 600,000 tonnes copper. (The Kamoa-Kakula data has not been reviewed
by Wood Mackenzie).
As of April 30, 2024, a total of 2.25 million tonnes of ore at a grade of 3.1% copper
is stored in surface run-of-mine (ROM) stockpiles adjacent to the Phase 3
concentrator. The stockpiled ore from the Kamoa 1 and Kansoko mines,
containing approximately 70,000 tonnes of copper, with the copper price trading
at well over $10,000 per tonne, is being used to de-risk the ongoing wet
commissioning and ramp-up of the new 5-Mtpa concentrator.
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400
600
800
1,000
1,200Paid Copper Production (kt)
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Dry commissioning commenced in early April, with first ore from the ROM
stockpiles being fed through the front-end (crushing and screening plant) of the
Phase 3 concentrator. A crushed ore stockpile has been created on the high-
pressure grinding rolls (HPGR) feed stockpile area, at the end of the crushing and
screening circuit. Wet commissioning commenced with first feed into the ball
mills and the flotation plant on May 26. First concentrate is expected to be
produced in early June, with commercial production targeted for early in the third
quarter.
Concentrate produced by the Phase 3 concentrator will be partially sold (via toll-
smelting at the Lualaba Copper Smelter) to generate cash flow, as well as
partially stockpiled in preparation for the commissioning of the on-site, direct-to-
blister smelter. Concentrate produced by the Phase 3 concentrator has a higher
sulphur content than the Phase 1 and 2, which requires less external energy input
into the smelter during start-up. Approximately, 70,000 tonnes of Phase 3
concentrate is planned to be stockpiled on-site ahead of the start-up of the
smelter.
Kamoa-Kakula’s Phase 3 concentrator expansion was completed months
ahead of schedule and will boost production to over 600,000 tonnes of
copper per annum once fully ramped up early in Q3 2024.
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Kamoa-Kakula’s Phase 3 concentrator has a nameplate throughput of 5
Mtpa. Once ramped-up, study work will commence on de-bottlenecking the
milling circuit. The de-bottlenecking at the Phase 1 and Phase 2
concentrators, completed in February 2023, increased throughput by over
20% above the original design capacity.
Kamoa-Kakula's Phase 3 ROM stockpile. As of April 30, 2024, Kamoa 1 and
Kansoko surface stockpiles adjacent to the Phase 3 concentrator totalled
2.25 million tonnes of ore, at a combined average grade of 3.1% copper.
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Significant growth opportunities to further increase copper
production with ‘Project 95’, Phase 3 de-bottlenecking program and
accelerating Phase 4 expansion
Basic engineering of the previously announced “Project 95” is expected to be
completed in the coming weeks. Project 95 is an initiative targeting an increased
overall metallurgical copper recovery rate of Kamoa-Kakula’s Phase 1 and 2
concentrators of approximately 95%, up from the current rate of approximately
87%.
Once the Phase 3 concentrator has achieved commercial production, Kamoa-
Kakula’s engineering team will gather operating data with the view to initiating a
de-bottlenecking program to further increase the Phase 3 concentrator
processing capacity above 5 Mtpa. The Phase 1 and 2 concentrators completed a
de-bottlenecking program in February 2023, which increased processing capacity
by approximately 20% above the original design throughput.
Following the completion of Phase 3, and given current market conditions,
Kamoa-Kakula’s engineering team is investigating the acceleration of the
project’s planned Phase 4 expansion. The Phase 4 concentrator will be
positioned adjacent to the Phase 3 concentrator, with a minimum processing
capacity of 5 Mtpa, and will share common infrastructure with Phase 3, including
the front end (crushing and screening plant), which will reduce capital costs.
An updated life-of-mine integrated development plan for the Kamoa-Kakula
Copper Complex, including the Phase 3 expansion, smelter and Project 95, as
well as further optimization initiatives and the planned Phase 4 expansion is
expected to be completed by the end of 2024.
55 MW of imported power significantly improving production from
Phase 1 and 2 concentrators; installation of further on-site backup-
power generation capacity well underway
Since mid-March, 15 megawatts (MW) of imported power have been reliably
supplied to Kamoa-Kakula from Zambia. In addition, since May 1, 2024, an
additional 20 MW of power is being imported from Mozambique via the Zambian
interconnector. The supplemental imported power has had a significant, positive
effect on the stability of Kamoa-Kakula’s operations. Total production from April
1, 2024 to date, totals more than 63,000 tonnes of copper in concentrate. This is a
notable improvement from the first quarter, which was impacted by power
instability. In addition, head grades have improved in the second quarter in part
due to increased underground pumping capacity. Imported power from
Mozambique is expected to increase by a further 20 MW imminently.
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Kamoa Copper’s engineering team continues to expand its on-site, backup
generation capacity to ensure there is on-site redundancy for the current Phase 1
and 2 operations, as well as mining and concentrator operations for Phase 3.
On-site backup-power generator capacity is scheduled to increase, via a phased
roll-out, to more than 200 MW by the end of 2024. The generator farm sites are
being built adjacent to the Phase 1 and 2 concentrators, and smelter at Kakula, as
well as adjacent to the Phase 3 concentrator at Kamoa.
As of May 27, 2024, 63 MW of on-site backup generation capacity is installed at
Kamoa-Kakula and that is expected to increase to a total of 123 MW by July. Peak
on-site power demand from Phase 1 and 2 operations is approximately 105 MW.
The Phase 3 concentrator will add an additional requirement of approximately 45
MW once fully ramped. In addition, the smelter will require a further 75 MW of
power once fully ramped up throughout 2025.
Industry-leading health and safety performance achieved during the
construction of the Phase 3 concentrator, with zero lost time injuries
During the 10 million man-hours worked on the construction of the Phase 3
concentrator, not a single lost time injury (LTI) was recorded; a rare industry
accomplishment. Therefore, the lost time injury frequency rate (LTIFR) and total
recordable injury frequency rate (TRIFR) for the project were both zero.
Including the smelter and other associated infrastructure projects included in the
Phase 3 expansion, over the total 40-million-man hours worked to date, only four
LTIs have been recorded and nine recordable injuries. The health and safety
performance set by the engineering and contractor teams is industry-leading with
a LTIFR and TRIFR of 0.10 and 0.22 per 1,000,000-man hours worked,
respectively. For comparison, the 2022 International Council on Mining and
Metals (ICMM) mining industry average was 2.66 per 1,000,000 man-hours
worked.