Shaft 1 reaches the top of Platreef’s “Flatreef” Deposit at 780 metres below surface at Ivanhoe’s platinum-group metals, nickel, copper and gold project in South Africa First underground mining intersection of the Platreef mineralized belt
October 8, 2018
Shaft 1 reaches the top of Platreef’s “Flatreef” Deposit at 780 metres
below surface at Ivanhoe’s platinum-group metals, nickel, copper
and gold project in South Africa
First underground mining intersection of the Platreef mineralized belt
on the Northern Limb of South Africa’s Bushveld Complex,
the world’s premier platinum producing region
Flatreef Deposit is an estimated 26 metres thick at Shaft 1 intersection
MOKOPANE, SOUTH AFRICA – Ivanhoe Mines’ (TSX: IVN; OTCQX: IVPAF) Executive Co-
Chairman Robert Friedland, Chief Executive Officer Lars-Eric Johansson and Ivanplats’
Managing Director Dr. Patricia Makhesha announced today that Platreef’s Shaft 1 has reached
the top of the high-grade Flatreef Deposit (T1 mineralized zone) at a depth of 780.2 metres below
surface.
The achievement by the Ivanplats shaft-sinking team is the first time that the Platreef – a
strongly mineralized, polymetallic belt that extends northward from the town of Mokopane for
more than 30 kilometres – has been intercepted by underground mining activity. Ivanplats’
Flatreef Deposit, with a strike length of six kilometres, lies within a flat to gently dipping portion
of the Platreef mineralized belt at relatively shallow depths of approximately 700 to 1,200 metres
below surface.
The Platreef mining team has delivered the first ore from the underground mine development to
a surface stockpile for metallurgical sampling. The estimated thickness of the mineralized reef
(T1 & T2 mineralized zones) at Shaft 1 is 26 metres, with grades of platinum-group metals
ranging up to 11 grams per tonne (g/t) 3PE (platinum, palladium and rhodium) plus gold, as well
as significant quantities of nickel and copper (see Chart 1, page 5). The 26-metre intersection
will yield approximately 3,000 tonnes of ore, estimated to contain more than 400 ounces of
platinum-group metals (PGMs).
“This is a significant milestone for Ivanplats and a tribute to the excellent work by the Platreef
Project team and its South African sinking contractor, Aveng Mining,” said Dr. Makhesha. “We
now can proudly show our stakeholders and investors Flatreef’s remarkably high-grade and
thick, flat-lying orebody that is ideal for safe, underground, bulk-scale, mechanized mining.
“Our focus is to keep advancing the Platreef Project along its critical path. We remain true to
our commitment to build Platreef into the world’s next great platinum-group metals mine ─ a
showcase for South Africa and the international investors that have financed the exploration
and development work,” Dr. Makhesha added.
Mr. Friedland noted that while some investors have expressed concern about the current price
of platinum, Platreef also has massive quantities of palladium, nickel and copper, as well as
rhodium and gold. He said the steady surge in the price of palladium could see it become more
valuable than gold for the first time in 16 years, and rhodium prices are near eight-year highs.
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The platinum-to-palladium ratio at the Platreef Mine is approximately 1:1. Palladium and
rhodium are used as catalysts to control exhaust emissions in gasoline-fuelled vehicles, while
diesel vehicles mostly use platinum. Platinum also is used as the catalyst in zero-emission,
hydrogen-powered, fuel-cell electric vehicles now being developed by many of the leading,
global automakers, such as Honda, Toyota, BMW, Mercedes-Benz and Hyundai.
“Building a new, large-scale mine such as Platreef is a capital- and time-intensive process that
requires us to embrace the future, and the future we see will include a lot more electric
vehicles using batteries and fuel cells,” Mr. Friedland said.
“We are confident that platinum, copper and nickel will be among the biggest beneficiaries of
the accelerating global transition to electric vehicles and clean energy .
“The Northern Limb is the future of platinum-group-metals mining. We will have the distinct
advantage of having a highly-mechanized, underground mining operation with a small
environmental footprint.
“On behalf of our stakeholders, international shareholders and progressive end users of our
metals, we are pleased to be leading the positive transformation in the way future underground
platinum mining operations in South Africa will be conducted,” Mr. Friedland added.
In July 2017, Ivanhoe issued an independent, definitive feasibility study (DFS) for Platreef
covering the first phase of production at an initial mining rate of four million tonnes per annum
(Mtpa). The DFS estimated that Platreef’s initial, average annual production rate will be 476,000
ounces of platinum, palladium, rhodium and gold, plus 21 million pounds of nickel and 13
million pounds of copper.
Photo: Members of the Platreef Project team and its South African sinking contractor,
Aveng Mining, in Shaft 1 at the intersection of the Flatreef Deposit.
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Photo: Gerick Mouton, Ivanplats’ Vice President & Project Director (front right) and Jan Mapeka,
Ivanplats’ PhD-enrolled Geologist (front left) with a piece of high-grade Flatreef ore
from the surface stockpile.
Photo: A sample from the first ore excavated from the Flatreef Deposit showing massive
pentlandite (nickel sulphide) and chalcopyrite (copper sulphide) mineralization.
Grades in the upper part of the T1 and T2 mineralized zones at Shaft 1 range
up to 11 g/t 3PE (platinum, palladium and rhodium) plus gold, as well as significant nickel
and copper.
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Photo: The distinct contact between the hanging wall norite-anorthosite (at top) and the upper
part of the Flatreef mineralized T1 pyroxenite (at bottom) in the Shaft 1 intersection.
Flatreef is an estimated 26 metres thick at Shaft 1 intersection
Geotechnical drill hole GT008, drilled vertically below Shaft 1, indicates that the grade for the T1
mineralized zone at the Shaft 1 location is 4.83 g/t 3PE plus gold, 0.33% nickel and 0.15% copper
over a vertical thickness of 12 metres (see Chart 1, page 5).
A well-developed chromitite stringer, marking the stratigraphic contact between the T1 and T2
mineralized zones, is expected to be intersected at a shaft depth of approximately 795 metres.
This will be followed by the T2 mineralized zone, which grades 4.14 g/t 3PE+gold, 0.35% nickel
and 0.18% copper over a vertical thickness of 11.26 metres (at a 2 g/t 3PE+gold grade cut-off).
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Photo: Dr. Danie Grobler, Ivanplats Manager, Geology (left), Jan Mapeka, Ivanplats PhD-enrolled
Geologist (centre), and Gerick Mouton, Ivanplats Vice President & Project Director (right),
at current shaft bottom (785m) with the T1 mineralized reef surrounding the shaft wall
and bottom.
Chart 1: Downhole plot of geotechnical drill hole GT008 (left) and the downhole plot of Shaft 1
intersection of the top of the Flatreef Deposit (right).
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Completed 750-metre station on Shaft 1 will provide initial, underground access
to the high-grade Flatreef orebody
The 750-metre station on Shaft 1 will provide initial, underground access to the high-grade
orebody, enabling mine development to proceed during the construction of Shaft 2, which will
become the mine’s main production shaft. The mining zones in the current Platreef Mine plan
occur at depths ranging from approximately 700 metres to 1,200 metres below surface.
Shaft 1’s 750-metre station also will allow access for the first raise-bore shaft, which will have
an internal diameter of six metres, to provide ventilation to the underground workings during
the mine’s ramp-up phase.
As shaft-sinking advances, two additional shaft stations will be developed at mine-working
depths of 850 metres and 950 metres. Shaft 1 is expected to reach its projected, final depth of
980 metres below surface, complete with the stations, in early 2020.
The thick, flat-lying orebody at the Platreef Project is ideal for bulk-scale, mechanized mining.
As underground development progresses, the mine plan calls for the addition of large,
mechanized mining equipment, such as 14- and 17-tonne load-haul-dump machines and 50-
tonne haul trucks to support the planned long-hole mining method.
Approximately 40% of Platreef’s shaft-sinking team now is comprised of employees from local
Mokopane communities who had no previous mining experience. New employees receive
intensive, on-site training for underground mining and complete a workplace-safety induction
program.
Construction progressing well at Shaft 2 surface box cut
Excavation of the Shaft 2 box cut to a depth of approximately 29 metres below surface is
progressing well. Completion of the box cut will allow for the construction of the concrete hitch
(foundation) for the 103-metre-tall concrete headgear (headframe) that will house the shaft’s
permanent hoisting facilities and support the shaft collar.
Shaft 2, to be located approximately 100 metres northeast of Shaft 1, will have an internal
diameter of 10 metres, will be lined with concrete and sunk to a planned, final depth of 1,104
metres below surface. It will be equipped with two 40-tonne rock-hoisting skips with a capacity
to hoist a total of six million tonnes of ore per year – the single largest hoisting capacity at any
mine in Africa. Headgear for the permanent hoisting facility was designed by South Africa-
based Murray & Roberts Cementation.
Platreef’s development team has decided to unbundle the complete Shaft 2 sinking contract into
smaller commitment portions, while still maintaining the critical development path.
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Photo: Platreef’s Shaft 2 box cut, with Shaft 1 headframe in the background.
Development focused on construction of a state-of-the-art underground mine
The Platreef Project is located on the Northern Limb of the Bushveld Complex, adjacent to
Anglo Platinum’s Mogalakwena Mine.
The Platreef Project, which contains the Flatreef Deposit, is a tier-one discovery by Ivanhoe
Mines’ geologists. Based on the findings of the July 2017 independent DFS, Ivanhoe plans to
develop the Platreef Mine as a major underground mining operation in three phases to achieve:
1) An initial rate of four million tonnes per annum (Mtpa) to establish an operating platform to
support future expansions; 2) a doubling of production to eight Mtpa; and 3) expansion to a
steady-state 12 Mtpa.
As Phase 1 is being developed and commissioned, there would be opportunities to refine the
timing and scope of subsequent phases of expanded production.
Given the size and potential of the Platreef Mineral Resource, Shaft 2 has been engineered with
a crushing and hoisting capacity of six Mtpa. This allows for a relatively quick and
capital-efficient first expansion of the Platreef Project to six Mtpa by increasing underground
development and commissioning of a third, two-Mtpa processing module and associated
surface infrastructure as required.
A further expansion to more than eight Mtpa would entail converting Shaft 1 from a ventilation
shaft into a hoisting/ventilation shaft. This would require additional ventilation exhaust raises,
as well as a further increase of underground development, commissioning of a fourth, two-Mtpa
processing module and associated surface infrastructure, as described in the PEA as Phase 2 of
the project.
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Photo: Lucas Malatji (left) and Zitha Ndwandwe, safety officers with contractor Aveng,
at Shaft 1's 750-metre-level station. The station will provide initial, underground access
to the high-grade orebody, enabling mine development to proceed during the
construction of Shaft 2.
Photo: Platreef’s underground mine development team includes three new members from local
communities (from left): Nkone Madubana, Learner Sinker; Katlego Nkwana, Learner
Sinker; and Caroline Dzivhani, Geologist.