Ivanhoe Mines To Invest US$2.5 Bln. In Mongolia For 2011; Shares Up - Update
(RTTNews) - Canada-based Ivanhoe Mines Ltd. (IVN: News , IVN.TO), Monday revealed a US$2.3 billion capital budget for 2011, for the first phase of its Oyu Tolgoi copper-gold project in southern Mongolia. Ivanhoe shares gained over 5% in the morning trade on the New York Stock Exchange, following the news.
The Oyu Tolgoi project is Ivanhoe's main mining property, located in Southern Mongolia. The mine is being developed in partnership with the Government of Mongolia, which owns a 34% stake, with the rest being held by Ivanhoe. The company is grooming the project along with U.K.-based mining behemoth Rio Tinto Plc (RIO: News ,RIO.L: News ).
The US$2.5 billion budget follows an earlier go-ahead of the 100,000 tonne per day project by the Ivanhoe Mines-Rio Tinto joint technical committee, and Oyu Tolgoi Llc, the Mongolian company that holds licenses for the mine.
Ivanhoe President John Macken said in a statement that the company expects to deliver the first ore to the concentrator up to six months earlier than previously projected.
Initial sales of copper and gold produced at the Southern Oyu open pit is anticipated during the fourth quarter of 2012, and is expected to yield revenues earlier than anticipated, Macken added.
Ivanhoe said that budget proposals for 2011, when construction activity is to hit peak levels, include US$561 million for the copper-gold concentrator, US$186 million to purchase the initial mining fleet of trucks and equipment, US$713 million for project infrastructure and power, US$211 million for underground mine development at the Hugo North Deposit.
For the phase one of the project starting on January 1, 2011, to the commissioning of the iron ore plant that is scheduled for the latter half of 2012, Ivanhoe projects capital requirement of US$3.5 billion.
Ivanhoe said commissioning will be followed later in 2012 by initial phase-one production, and then by commercial production expected during the first half of 2013.
Capital required from January 1, 2011, through to completion of the phase-one project is expected to to be about US$4.5 billion.
The 2011-2013 estimate also includes US$1 billion that has been allocated to cover tax payments to the Mongolian Government among other costs.
Ivanhoe plans to initially produce 100,000 tonnes of ore per day, and expects 150,000 to 160,000 tonnes per day later on.
IVN is trading at $25.23, up $1.29 or 5.39%, on the NYSE. On the Canadian Exchange, IVN.TO is trading at C$25.39, up C$1.15 or 4.74%.
Shares of RIO are trading at $71.47, up $1.20 or 1.71%, on the NYSE. On the London exchange, RIO.L is at 4,486.50 pence, up 73.00p or 1.65%.
The Oyu Tolgoi project is Ivanhoe's main mining property, located in Southern Mongolia. The mine is being developed in partnership with the Government of Mongolia, which owns a 34% stake, with the rest being held by Ivanhoe. The company is grooming the project along with U.K.-based mining behemoth Rio Tinto Plc (RIO: News ,RIO.L: News ).
The US$2.5 billion budget follows an earlier go-ahead of the 100,000 tonne per day project by the Ivanhoe Mines-Rio Tinto joint technical committee, and Oyu Tolgoi Llc, the Mongolian company that holds licenses for the mine.
Ivanhoe President John Macken said in a statement that the company expects to deliver the first ore to the concentrator up to six months earlier than previously projected.
Initial sales of copper and gold produced at the Southern Oyu open pit is anticipated during the fourth quarter of 2012, and is expected to yield revenues earlier than anticipated, Macken added.
Ivanhoe said that budget proposals for 2011, when construction activity is to hit peak levels, include US$561 million for the copper-gold concentrator, US$186 million to purchase the initial mining fleet of trucks and equipment, US$713 million for project infrastructure and power, US$211 million for underground mine development at the Hugo North Deposit.
For the phase one of the project starting on January 1, 2011, to the commissioning of the iron ore plant that is scheduled for the latter half of 2012, Ivanhoe projects capital requirement of US$3.5 billion.
Ivanhoe said commissioning will be followed later in 2012 by initial phase-one production, and then by commercial production expected during the first half of 2013.
Capital required from January 1, 2011, through to completion of the phase-one project is expected to to be about US$4.5 billion.
The 2011-2013 estimate also includes US$1 billion that has been allocated to cover tax payments to the Mongolian Government among other costs.
Ivanhoe plans to initially produce 100,000 tonnes of ore per day, and expects 150,000 to 160,000 tonnes per day later on.
IVN is trading at $25.23, up $1.29 or 5.39%, on the NYSE. On the Canadian Exchange, IVN.TO is trading at C$25.39, up C$1.15 or 4.74%.
Shares of RIO are trading at $71.47, up $1.20 or 1.71%, on the NYSE. On the London exchange, RIO.L is at 4,486.50 pence, up 73.00p or 1.65%.
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