Name of the Project
Kamoa-Kakula copper project.

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

Project Owner/s
The Kamoa-Kakula project is a joint venture between base and precious metals developer Ivanhoe Mines, with 39.6% ownership; Zijin Mining Group, with 39.6% ownership; Crystal River Global, with 0.8% ownership; and the DRC government, with 20% ownership.

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

The plan 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; the first module is  under advanced construction. For this option, the DFS envisages average production of 284 000 t of copper over an estimated 21-year mine life.

Kakula will be mined primarily using the drift-and-fill method.

The Kakula 2020 DFS mine access will be through twin declines on the north side and a single decline on the south side of the deposit. One of the north declines will serve as the primary mine access, while the other decline is for the conveyor haulage system, which was recently commissioned.

The primary ore-handling system will include a perimeter conveyor system connected to truck load-out points along the north side of the deposit. The perimeter conveyor system will terminate at the main conveyor decline.

Kakula-Kansoko
The Kakula-Kansoko PFS evaluates the mining of 1.6-million tonnes a year from the Kansoko mine, in addition to six-million tonnes a year from Kakula, to feed a 7.6-million-tonne-a-year processing plant at Kakula. For this option, the PFS envisages average production of 331 000 t/y of copper over an average 37-year mine life.

Kamoa-Kakula
The Kamoa-Kakula PEA evaluates an integrated, multistaged development to achieve a 19-million-tonne-a-year production rate. Initial production will start from the proposed six-million-tonne-a-year Kakula mine, followed by separate underground mining operations at the nearby six-million-tonne-a-year Kansoko mines, the six-million-tonne-a-year Kakula West and one-million-tonne-a-year Kamoa North mine, along with the construction of a direct-to-blister smelter at the Kakula plant site that will be able to process one-million tonnes of copper concentrate a year.  

The Kamoa North Area comprises five separate mines, which will be sequentially developed as resources are depleted elsewhere to maintain the production rate of up to 19-million tonnes a year over a mine life of more than 40 years.

Each mining operation is expected to be a separate underground mine with a shared processing facility and surface infrastructure located at Kakula. Material will be transported to the Kakula processing complex using a system of overland conveyors. Included in this scenario is the construction of a direct-to-blister copper smelter with a capacity of one-million tonnes a year of copper concentrate.

The phased expansion scenario to 19-million tonnes a year would position Kamoa-Kakula as the world’s second-biggest copper mining complex, with peak copper production of more than 800 000 t/y.

Potential Job Creation
Once the two processing plants at Kakula are operating, Ivanhoe expects to employ almost 2 000 permanent Kamoa employees.

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 mine life, 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 mine life, with a payback of 2.5 years.

The Kamoa-Kakula PEA yields a potential after-tax net present value, 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.

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

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

Planned Start/End Date
Initial copper concentrate production from the Kakula project is scheduled for the third quarter of 2021.

The expansion of the Kakula processing plant will be brought forward from the first quarter of 2023 to the second quarter of 2022.

Latest Developments
Ivanhoe Mines is considering accelerating the Phase 3 concentrator expansion at its Kamoa-Kakula project, following the recent success of its $575-million convertible notes financing.

The company has already brought forward Phase 2 production to the third quarter of 2022. Phase 2 will increase copper output to 400 000 t/y, or about 880-million pounds a year.

Initial production at the Kakula mine processing plant is scheduled for July 2021, which will mark Ivanhoe’s transition from an explorer and developer to a mining company that produces copper, platinum-group metals and nickel.

The additional funding also enables Ivanhoe to accelerate hydropower upgrades to provide sufficient clean and renewable electricity for Kamoa-Kakula expansions, including a smelter, and to step up exploration work at its Western Foreland project.

Ivanhoe Mines co-chairpersons Robert Friedland describes expedited hydropower upgrades as a “high-priority opportunity”, as the company seeks to produce the “green” copper that the world energy transition requires.

An independent audit of Kamoa-Kakula’s greenhouse-gas intensity metrics has calculated that the project will be among the world’s lowest greenhouse-gas emitters per unit of copper produced.

Regarding downstream plans, Ivanhoe reports that Kamoa Copper is considering the potential construction of a smelting complex to produce blister and anode copper.

Investing in a smelter will reduce transport and logistics costs, export taxes and concentrate treatment charges while producing sulphuric acid as a by-product, the company states.

Based on Finland’s Outotec direct-to-blister furnace technology, the smelter complex will have a design capacity of 750 000 t/y to one-million tonnes a year of concentrate feed, producing more than 400 000 t/y of copper in the form of blister and anode.

According to the 2020 preliminary economic assessment for Kamoa-Kakula, such a project will require $600-million.

Ivanhoe says field work – as part of the 2021 exploration programme on its Western Foreland exploration licences, in close proximity to Kamoa-Kakula – will begin at the start of the dry season, which is typically in April. 

Key Contracts, Suppliers and Consultants
DFS/PFS/PEA:
OreWin (overall report preparation, mining, logistics, power and economic analysis); China Nerin Engineering (smelter design); 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); and Wood (mineral resources estimation).

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