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Integrated Development Plan for Ivanhoe's Oyu Tolgoi copper-gold
mine expected in early September
SIGNIFICANT PROGRESS BEING MADE ON STABILITY AGREEMENT
ULAANBAATAR, MONGOLIA, July 5 /PRNewswire-FirstCall/ -- Ivanhoe Mines Chairman
Robert Friedland and President John Macken announced today that the company now
expects to be in a position to finalize and release its new, independent
Integrated Development Plan (IDP) for the Oyu Tolgoi copper and gold project in
Mongolia in early September, 2005, following in-depth briefings and
consultation with relevant ministries of the Government of Mongolia.
Ivanhoe had expected to receive and release the IDP for Oyu Tolgoi before the
end of the second quarter of 2005. The recent discovery of extensive,
high-grade copper and gold mineralization during drilling into the deeper
portions of the Hugo North Deposit has provided an opportunity to re-engineer
the planned, initial block-cave mining operation, which now will be deeper and
larger than was originally planned. Ivanhoe's engineering consultants are
optimizing the initial underground block-cave mine production schedules and
other aspects of the design to yield benefits that include increasing the peak
production rate to 100,000 tonnes of ore per day. Open-pit mining will be
configured around the underground production plan to provide a sustained, total
throughput of between 140,000 and 160,000 tonnes of ore per day. The capital
and operating cost estimates required for the IDP can be completed once the
final plans are developed.
The IDP, based on the independent resource estimate prepared by AMEC and
released in May, 2005, and an assumed mine life of approximately 40 years, will
provide an informative summary of the future development of the Oyu Tolgoi
Project. The recent discovery of significant additional high-grade
mineralization in the open-ended Hugo Far North Discovery has extended the Hugo
North deposit by at least 450 metres beyond the northern limit used in the May,
2005, AMEC estimate. The expected mine life and/or production rates at Oyu
Tolgoi could be significantly increased if further drilling succeeds in
converting the new mineralization into resources.
The IDP is being prepared by an integrated engineering team of AMEC Americas
Limited, of Vancouver, Canada; Ausenco International Pty. Ltd., of Perth,
Australia; the Mining Group of GRD Minproc Limited, of Perth; and McIntosh
Engineering Inc., of Tempe, Arizona, USA. Other Perth-based consultants
providing their expertise and input are SRK Consultants and Aquaterra
Consulting Pty. Ltd.
STABILITY AGREEMENT UPDATE
Mr. Friedland and Mr. Macken also announced that significant progress has been
made recently by Ivanhoe and the relevant Mongolian Government ministry toward
reaching a suitable arrangement to address Oyu Tolgoi's short-term and
long-term electrical power requirements. An agreement on electrical power is
the last significant issue to be settled before a long-term Special Stability
Agreement for Oyu Tolgoi can be finalized between Ivanhoe and the Government of
Mongolia. Ivanhoe has noted a Bloomberg news service report April 28th in which
Mongolia's Prime Minister Tsakhya Elbegdorj stated in an interview that
stability agreements could be signed by the end of this summer with mining
companies, including Ivanhoe, planning to invest in the development of coal,
copper and other mineral resources near Mongolia's border with China.
SHAFT NO. 1 UPDATE
To bring the underground resources of the Hugo Dummett Deposit into a proven
and probable reserve category for feasibility purposes, actual underground
development and characterization is required. This will be accomplished by the
planned, 1,300-metre-deep Shaft No.1, currently being developed by the Redpath
Group of North Bay, Ontario, Canada, and subsequent development of horizontal
accesses to the high-grade mineralization. When completed, the shaft will
provide access to the Hugo North and Hugo South portions of the deposit to
enable completion of detailed feasibility studies, further resource delineation
drilling and rock-characterization work. The target completion date for Shaft
No. 1 is early 2007, with underground drifting and drilling planned for Hugo
North in 2007 and early 2008, and in Hugo South in 2009 and 2010 (see
http://www.ivanhoemines.com/ for a progress update with recent photographs of
Shaft No. 1).
In response to growing interest by international institutional investors,
Ivanhoe is arranging a number of site visits to the Oyu Tolgoi project during
August, September and October specifically to meet their requirements. Roger
Walsh, Ivanhoe's newly appointed Vice-President, Corporate Development, is
coordinating itineraries and may be telephoned at 1 604 331 8604 in Vancouver,
Canada.
William Hogg, CPEng., MIEAust, Ivanhoe Mines Project Manager, a qualified
person as defined by NI 43-101, supervised the preparation of the technical
information in this release.
Ivanhoe has a 100% interest in the Oyu Tolgoi Project in Mongolia and owns or
controls exploration rights covering approximately 128,000 square kilometres in
central and southern Mongolia, where additional copper, gold and coal
discoveries have been made. Ivanhoe produces LME grade A copper from its Monywa
joint venture in Myanmar.
Ivanhoe shares are listed on the Toronto and New York stock exchanges under the
symbol IVN.
Information contacts:
---------------------
Investors: Bill Trenaman: +1.604.688.5755 / Media: Bob Williamson,
+1.604.688.5755
Forward-Looking Statements: Statements in this release that are forward-
looking statements are subject to various risks and uncertainties concerning
the specific factors disclosed under the heading "Risk Factors" and elsewhere
in the corporation's periodic filings with Canadian and US securities
regulators. When used in this document, the words such as "could," "plan,"
"estimate," "expect," "intend," "may," "potential," "should," and similar
expressions, are forward-looking statements. The risk factors that could cause
actual results to differ from these forward-looking statements include, but are
not restricted to, geological or mechanical difficulties affecting the
company's planned drilling, operational risk, environmental risk, financial
risk, geo-political risk, commodity risk, currency risk and other statements
that are not historical facts as disclosed under the heading "Risk Factors" and
elsewhere in the corporation's periodic filings with securities regulators in
Canada and the United States.
DATASOURCE: Ivanhoe Mines Ltd.
CONTACT: Investors: Bill Trenaman, (604) 688-5755. Media: Bob
Williamson, (604) 688-5755;
To request a free copy of this organization's annual report, please go to
http://www.newswire.ca/ and click on reports@cnw.