Name and Location
Ivanplats Platreef project – platinum group metals (PGMs), nickel, copper and gold mine, Limpopo, South Africa.

Client
Ivanhoe Mines owns 64% of the Platreef project through its subsidiary Ivanplats and manages all project development work. The South African beneficiaries of the approved broad-based black economic-empowerment (BBBEE) structure have a 26% stake in the project, and the remaining 10% is owned by a Japanese consortium of ITOCHU Corporation; Japan Oil, Gas & Metals National Corporation; ITC Platinum Development, an ITOCHU affiliate; and JGC.

Ivanplats is the top-ranked platinum- sector mining company in terms of compliance with South Africa’s black economic-empowerment laws. The company achieved Level 3 status on the BBBEE scorecard in 2015 and 2016.

The communities around the Platreef project are widely consulted, with about 150 000 members becoming equity shareholders and an estimated 74% of employees and contractors coming from surrounding communities.

Project Description
The Platreef project is a Tier 1 discovery, which contains the underground Flatreef deposit of PGMs, copper, nickel and gold, located on the northern limb of South Africa’s Bushveld Igneous Complex – the world’s premier platinum-producing region. Ivanplats has declared an initial probable mineral reserve of 15.51-million ounces of platinum, palladium, rhodium and gold (3PE+Au). The mineral reserve is expected to support a 31-year mine life at steady-state production of four-million tonnes a year.

An independent preliminary economic assessment (PEA), which was completed in March 2014, proposed a three-phased approach to Platreef’s long-term development. The Platreef prefeasibility study (PFS), which was completed in January 2015, validated the results of Phase 1 of the independent PEA.

Key features of Phase 1 include:
• the development of a large, mechanised underground mine, with an initial four-million-tonne-a-year concentrator and associated infrastructure; and
• a planned, initial average yearly production rate of 433 000 oz of 3PE+Au, and 19-million pounds of nickel and 12-million pounds of copper a year.

Among the current and future northern limb producers, Platreef will rank near the bottom of the operating cash-cost curve, at an estimated $322/oz of 3PE+Au, net of by-products credits.

Phase 2 involves an expansion of the mine to double production to eight-million tonnes a year.

The third phase involves a further expansion of the mine to a steady state of 12-million tonnes a year, placing it among the largest PGMs mines in the world.

Mining zones in the current Platreef mine plan occur at depths ranging from about 700 m to 1 200 m below surface.

Access to the mine will be through two vertical shafts. Shaft 1 is currently under development and will be used for initial access, early underground development and ventilation. The shaft will have an internal diameter of 7.25 m and is projected to reach a total depth of 975 m in 2018. Additional dedicated ventilation shafts will be provided to support mine development. Shaft 2 will comprise the main personnel, materials and ore-handling system.

Highly productive, mechanised methods will be used for mining, including long-hole stoping and drift-and-fill mining. The ore will be hauled from the mechanised stopes to the bottom of Shaft 2, where it will be crushed and then hoisted to the surface. Shaft 2 will have a finished internal diameter of
10 m and will be equipped to hoist up to six-million tonnes a year.

Net Present Value/Internal Rate of Return
Phase 1 has an after-tax net present value of $972-million, at an 8% discount rate, and an after-tax internal rate of return of 13%.

Value
The estimated preproduction capital requirement for Phase 1 is about $1.2-billion, including $114-million in contingencies.

Duration
According to the latest PEA released, Phase 1 is expected to be completed by 2019.

Phase 2 is expected to be completed by 2024 and Phase 3 by 2028.

Latest Developments
Ivanhoe Mines is confident that operations at its Platreef mine, which is expected to eventually produce 12-million tonnes of platinum a year, will start in 2019 and will be expanded continually in a series of stages into a state-of-the-art modern mine.

Shaft-sinking activities are well under way on Shaft 1, with the concrete collar and ventilation intake plenum completed. Presink (-54 m) is complete and current work includes the change-over (headgear) from presink to main sink, as well as commissioning and licensing of the stage and kibble winder, workshops and stores.

Key Contracts and Suppliers
DRA Projects (PFS, feasibility study, mining, concentrator and infrastructure); OreWin (National Instrument 43-101 technical report); Aveng Mining (Shaft 1 sinking contractor); Murray & Roberts Cementation (design and engineering for shaft infrastructure); Stantec Consulting (mine planning); Golder Associates (water studies, backfill and tailings); Digby Wells Environmental (social and environmental); SRK (geotechnical) and Mintek (metallurgical testwork).

On Budget and on Time?
Phase 1 is under development, during which an operating platform will be established to support the start of production, which is expected by 2019.

Contact Details for Project Information
Ivanplats VP and executive head: capital projects Gerick Mouton, tel +27 11 088 4300 or email gerickm@ivanplats.com.
DRA Projects, tel +27 11 202 8600 or email info@DRAglobal.com.
OreWin, tel +61 8 8210 5600 or email orewin@orewin.com.
Aveng Mining, tel +27 10 207 7000, fax +27 10 207 7202 or email info@avengmining.com.
Murray & Roberts Cementation, tel +27 11 201 5000 or email info.cementation@murrob.com.