Name of the Project
Kamoa-Kakula Copper Complex.

Location
The Kolwezi district of Lualaba province, in the Democratic Republic of Congo (DRC).

Project Owner/s
Kamoa Holding, a joint venture between the Ivanhoe Mines and Zijin Mining Group Co, holds a direct 80% interest in the Kamoa-Kakula Copper Complex. Ivanhoe holds an effective 39.6% interest in the project through its 49.5% shareholding in Kamoa Holding. Zijin holds 49.5% while the remaining 1% share interest is held by privately owned Crystal River Global.

Project Description
Ivanhoe Mines has announced outstanding economic results in an independent integrated development plan for the Tier 1 Kamoa-Kakula copper project.

The Kamoa-Kakula Integrated Development Plan 2020 comprises three development scenarios: the Kakula definitive feasibility study (DFS), the Kakula-Kansoko prefeasibility study (PFS) and the Kamoa-Kakula preliminary economic assessment (PEA).

Kakula
The Kakula DFS proposes the development of a Stage 1, six-million-tonne-a-year underground mine and surface processing complex at the Kakula deposit, with a capacity of 7.6-million tonnes a year built in two modules of 3.8-million tonnes a year. For this option, 110-million tonnes will be mined at an average grade of 5.22% copper producing 8.5-million tonnes of high-grade copper concentrate and containing about 10.8-billion pounds of copper.

Kakula-Kansoko
The Kakula-Kansoko 2020 PFS evaluates the development of mining activities at the Kansoko deposit in addition to the Kakula mine, initially at 1.6-million tonnes a year, to supply the concentrator at Kakula, eventually ramping up to six-million tonnes a year as the reserves at Kakula are depleted.

Kamoa-Kakula
The Kamoa-Kakula 2020 PEA assessed an additional development option of mining several deposits on the Kamoa-Kakula project as an integrated, 19.2-million-tonne-a-year mining, processing and smelting complex, built in multiple stages.

At the end of January 2023, Ivanhoe announced the positive findings of an independent integrated development plan (2023 IDP) for the project. The 2023 IDP consists of a PFS (Kamoa-Kakula 2023 PFS) for the Phase 3 and Phase 4 expansions of the complex over a 33-year life-of-mine (LoM), as well as an updated PEA (Kamoa-Kakula 2023 PEA) that includes an LoM extension case to 42 years overall.

Kamoa-Kakula 2023 PFS – Phase 3 and 4 expansion, involves a staged increase in nameplate production of up to 19.2-million tonnes a year over a 33-year LoM.

The first stage is the debottlenecking of the operational Phase 1 and Phase 2 concentrators from the current nameplate capacity of 7.6-million tonnes a year to 9.2-million tonnes a year by the second quarter of 2023.

The Phase 1 and 2 concentrators will process ore initially from the Kakula mine, which is being expanded to meet this capacity, and then supported by the Kakula West mine from 2029.

This will be followed by the construction of the five-million-tonne-a-year Phase 3 concentrator. This 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 about 10 km to the south. The process design of all three concentrators is comparable and, 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 a year. Phase 3 is expected to increase annualised copper production to more than 600 000 t, positioning Kamoa-Kakula as the world’s fourth-largest copper mining complex, and the largest copper mine on the African continent. 

In the fourth and final phase, an additional five-million-tonne-a-year concentrator, which will take the total processing capacity to 19.2-million tonnes a year, fed by an expansion of the Kamoa mines, will be built.

Kamoa and Kakula will supply a blend of copper concentrate for the smelter as the ore reserve grade tapers over time.

Kamoa-Kakula 2023 PEA – LoM extension case, proposes a nine-year LoM extension of the Kamoa-Kakula Copper Complex, in addition to the Kamoa-Kakula 2023 PFS.

This case includes the addition of four new underground mines in the Kamoa area – Kamoa 3, 4, 5 and 6 – to maintain the overall production rate of up to 19.2-million tonnes a year.

The Kamoa-Kakula PEA is preliminary and includes an economic analysis that is partially based on inferred mineral resources. These resources are considered too speculative geologically for the application of economic considerations that would allow for their being categorised as mineral reserves and there is no certainty that the results will be realised.

Potential Job Creation
Kamoa-Kakula has generated more than 12 000 jobs from its operations and construction activities, with more than 95% of those positions filled by Congolese nationals.

At the end of November 2023, about 2 000 construction workers were at the smelter site, with the number expected to peak at 3 000 in December 2023.

Net Present Value/Internal Rate of Return
The Kakula DFS yields an after-tax net present value (NPV), at an 8% discount rate, of $5.5-billion and an internal rate of return (IRR) of 77% over a 21-year LoM, with a payback of 2.3 years.

The Kakula-Kansoko PFS yields an after-tax NPV, at an 8% discount rate, of $6.6-billion and an IRR of 69% over a 37-year LoM, with a payback of 2.5 years.

The Kamoa-Kakula 2020 PEA yields a potential after-tax NPV, at an 8% discount rate, of $11.1-billion and an IRR of 56% over a mine life of more than 40 years, with a payback of 3.6 years.

The Kamoa-Kakula 2023 PFS case yields an after-tax NPV, at an 8% discount rate, of $19.1-billion at a long-term copper price of $3.70/lb.

The Kamoa-Kakula 2023 PEA case yields an after-tax NPV, at an 8% discount rate, of $20.2-billion.

Capital Expenditure
The Kakula DFS estimates peak funding at $775-million, remaining initial capital costs at $646-million and expansion capital costs at $594-million.

The Kakula-Kansoko 2020 PFS estimates peak funding at $848-million, remaining initial capital costs at $695-million and expansion capital costs at $750-million.

The Kamoa-Kakula 2020 PEA estimates peak funding at $784-million, remaining initial capital costs at $715-million and expansion capital costs at $4.46-billion.

The Kamoa-Kakula 2023 PFS estimates the remaining capital cost for the total Phase 3 expansion at $3-billion, including the mine, concentrator, smelter, infrastructure and investment in off-site hydropower infrastructure.

Planned Start/End Date
The initial production of copper concentrate at the Kakula mine processing plant began on May 25, 2021, with commercial production achieved on July 1, 2021.

The Phase 2 concentrator started commercial production in April 2022, four months ahead of schedule.

The Phase 3 concentrator expansion was completed months ahead of schedule in May 2024 and is expected to fully ramp up early in the third quarter of 2024.

Latest Developments
Ramp-up of the Phase 3 concentrator is complete, ahead of schedule as with Phase 1 and 2, with copper production capacity up to 600 000 t/y.

Construction of the Kamoa 1 and 2 underground-to-surface ore conveyor system, similar in design to the one at Kakula, as well as the first underground truck tip, are complete and are undergoing commissioning. This allows for ore mined from the Kamoa 1 and 2 underground mines to be fed directly into the Phase 3 concentrator, rather than drawing on surface low-grade stockpiles that were regularly used during ramp-up.

The Phase 3 concentrator will now be fed predominantly with run-of-mine (RoM) ore from the Kamoa 1 and 2 underground mines, supplemented where necessary by surface stockpiles. The Phase 3 concentrator recovery rate averaged 83% during October. Going forward, recovery rates are expected to increase in-line with the nameplate recovery rate of 86% as more fresh RoM ore is processed.

The direct-to-blister copper smelter is more than 94% complete, with construction on schedule for completion by the end of the year. The smelter, adjacent to the Phase 1 and 2 concentrators, will be fed by a blend of concentrate from the Phase 1, 2, and 3 concentrators.

The final stages of construction completion are under way at the smelter, including the insulation of the off-gas ducting system. Off-gases, which contain acid, as well as waste heat, are captured from the furnace building and recycled.

Captured sulphuric acid from the smelter’s furnace building will be sold to mining operations on the DRC copperbelt. The smelter is expected to produce up to 700 000 t/y of high-strength sulphuric acid as a by-product.

Construction of the smelter’s fugitive-off-gas handling building, adjacent to the furnace building, is also nearing completion.

Ivanhoe is nearing the completion of the engineering for Kamoa-Kakula’s Phase 4 expansion and is “making significant strides” across its Western Foreland exploration licences, with 11 drill rigs turning.

Key Contracts, Suppliers and Consultants
Kakula DFS/ Kakula-Kansoko PFS/ Kamoa-Kakula PEA: OreWin (overall report preparation, mining, logistics, power and economic analysis); China Nerin Engineering (smelter design and basic engineering contract for the smelter); DRA Global (mine surface infrastructure and metallurgical processing); Epoch Resources (tailings storage facility design); Golder Associates (hydrology models and recommendations); KGHM Cuprum R&D Centre (technical adviser on certain mining methods and geotechnical); Outotec Oyj (smelter technology); Paterson and Cooke (paste backfill plant design and surface/underground paste distribution system); SRK Consulting (mine geotechnical recommendations); Stantec Consulting International (mining and mineral reserves); Wood (mineral resources estimation); Kamoa Copper and SNEL, together with Stucky SA (engineering, procurement and construction management – Turbine 5); Voith Hydro (contractor Turbine 5); and Metso Outotec (direct blister furnace and fine grinding mills).

Kamoa-Kakula 2023 PFS/Kamoa-Kakula 2023 PEA: OreWin; China Nerin Engineering; DRA Global; Epoch Resources; Golder Associates Africa; Metso-Outotec Oyj; Paterson and Cooke; SRK Consulting; and MSA Group.

Epiroc (Minetruck MT65 S haulers, the world’s highest payload underground truck in the field, as well as Scooptram ST18 S loaders, Boomer 282 face drilling rigs and Simba E70 S production drilling rigs).

Contact Details for Project Information
Ivanhoe Mines, tel +1604 688 6630 (North America), tel +27 11 088 4300 (South Africa) or email info@ivanhoemines.com.