Long-Term Mining Right for Ivanhoe Mines' Platreef Project Approved by South
Africa's Department of Mineral Resources
JOHANNESBURG, SOUTH AFRICA -- (Marketwired) -- 06/02/14 -- Robert
Friedland, Executive Chairman, and Lars-Eric Johansson, Chief
Executive Officer of Ivanhoe Mines (TSX: IVN), announced today that
the South African government's Department of Mineral Resources has
approved Ivanhoe's application for a long-term mining right covering
the development of platinum-group elements, nickel, copper and gold
resources at the company's Platreef Project on the Northern Limb of
the Bushveld Igneous Complex in South Africa's Limpopo Province.
The Department of Mineral Resources notified Ivanhoe Mines on Friday,
May 30, that Platreef's mining right had been granted. Ivanhoe now
has the right to mine and process all platinum group metals, nickel,
copper, gold and certain associated metals and minerals from the
Platreef Project mining area, subject to the company complying with
the terms on which the mining right was granted - including the
requisite environmental management program becoming effective, which
is expected in due course. It also is expected that the mining right,
when executed, will be for an initial period of up to 30 years and
will be renewable for an unlimited number of consecutive periods each
of up to 30 years.
"The awarding of this mining right is hugely significant not only for
Ivanhoe Mines but for South Africa's mining industry as a whole and
is a culmination of Ivanhoe's exploration on the Bushveld for the
past 16 years," said Mr. Friedland.
He noted that the company launched a deep-drilling program in 2007
that produced the "transformational" Flatreef Deposit, Platreef's
most remarkable discovery, which is projected to become Africa's
lowest-cost producer of platinum-group metals.
"Ivanhoe now has the green light from the South African government to
build a pre-eminent mine that will create thousands of new direct and
indirect jobs and contribute to socio-economic development in the
Mokopane region and beyond.
"We are looking forward to building and bringing our Platreef mine
into production in partnership with local communities, entrepreneurs,
employees and the government - stakeholders that share our commitment
to responsible and responsive mining."
Mr. Friedland hailed the cooperation between officials of the
Department of Mineral Resources (DMR) and other national and
provincial government offices, local community representatives and
members of Ivanhoe's project team who helped shape the Broad-Based
Black Economic Empowerment (B-BBEE) initiative that has been designed
to deliver significant benefits for its participants, particularly
the residents in the local communities.
"The thorough, year-long examination of our mining-right application
provided opportunities for the Ivanhoe team to present firm details
of our undertakings and to share expectations of the extent of the
economic and social benefits to be realized through the development
of our discoveries. Platreef's creation of jobs and attraction of new
capital investment will help to enhance South Africa's role as one of
the world's leading mineral producing and processing nations."
Mr. Johansson said Ivanhoe would pursue its phased approach to the
development of the Platreef Project that was announced in the
independent, preliminary economic assessment released in March 2014.
The approval of the mining-right application followed an intensive
review and engagement between representatives of Ivanhoe and the DMR
which finalized details of Ivanhoe's corporate programs covering the
required social, labour, environmental management and mining
Mr. Johansson expressed Ivanhoe's appreciation for the hard work and
dedication of officials at the DMR to ensure that the Platreef
mining-right application was thoroughly reviewed and approved prior
to the expiration of the company's prospecting right on May 31.
"This inspires confidence in South Africa's regulatory framework and
shows the government's commitment to growing the South African mining
industry," said Mr. Johansson.
Agreement also was reached on acceptable terms for a B-BBEE
participation structure that were progressively refined and optimized
to ensure that the resulting partnership would deliver long-term
benefits to local communities and entrepreneurs, as well as to
Platreef's employees. In terms of Platreef's mining right, the B-BBEE
partners will own a combined 26% of the Platreef Project. Additional
details of the B-BBEE participation structure will be released in the
Ivanhoe's present 90% ownership of the Platreef Project will be
reduced to 64% after the 26% stake in the project is conferred on the
B-BBEE entity. The remaining 10% will continue to be owned by a
Japanese consortium of Itochu Corporation; ITC Platinum Development
Ltd., an Itochu affiliate; Japan Oil, Gas and Metals National
Corporation; and Japan Gas Corporation. The Japanese consortium's 10%
interest in the Platreef Project was acquired in two tranches for a
total investment of $290 million; the remaining proceeds of the
investment are continuing to fund development work on the project.
The scientific and technical information in this news release has
been reviewed and approved by Stephen Torr, P.Geo., Ivanhoe Mines'
Vice President, Project Geology and Evaluation, a Qualified Person
under the terms of National Instrument 43-101. Mr. Torr has verified
the technical data disclosed in this news release.
Cautionary statement on forward-looking information
This news release contains "forward-looking statements" or
"forward-looking information" within the meaning of applicable
Canadian securities legislation. Such statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the company to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements
or information. Such statements can be identified by the use of words
such as "may", "would", "could", "will", "intend", "expect",
"believe", "plan", "anticipate", "estimate", "scheduled", "forecast",
"predict" and other similar terminology, or state that certain
actions, events or results "may", "could", "would", "might" or "will"
be taken, occur or be achieved. These statements reflect the
company's current expectations regarding future events, performance
and results and speak only as of the date of this news release.
Specific statements contained in this news release that constitute
forward-looking statements or information include, but are not
limited to, the implementation of the Broad-Based Black Economic
Empowerment structure for the Platreef Project; and the phased
approach to the development of the Platreef Project.
With respect to forward-looking statements or information contained
in this news release, in making such statements or providing such
information, the company has made assumptions including upon the
accuracy of the estimation of mineral resources; that studies of
estimated mine life and production rates at the Platreef Project will
provide results that support anticipated development and extraction
activities; that the company will be able to obtain additional
financing on satisfactory terms; that infrastructure anticipated to
be developed or operated by third parties, including electrical
generation and transmission capacity, will be developed and/or
operated as currently anticipated; that laws, rules and regulations
are fairly and impartially observed and enforced; that the market
prices for relevant commodities remain at levels that justify
development and/or operation of the Platreef Project; that parties to
contracts perform as contracted, and that the company will be able to
successfully negotiate land access with holders of surface rights.
A number of factors could cause actual results to differ materially
from the results discussed in the forward-looking statements,
including without limitation, the factors discussed in the company's
Annual Information Form, as well as unexpected changes in laws, rules
or regulations, or their enforcement by applicable authorities;
changes in commodity prices; the failure of parties to contracts with
the company to perform as agreed; social or labour unrest; or
litigation or court or regulatory proceedings.
Although the forward-looking statements contained in this news
release are based upon what management of the company believes are
reasonable factors and assumptions, the company cannot assure readers
that actual results will be consistent with these forward-looking
statements. The company's actual results could differ materially from
those anticipated in these forward-looking statements, as a result
of, among others, those factors noted above and those listed in the
Annual Information Form under the heading "Risk Factors".
Accordingly, readers should not place undue reliance on
forward-looking information. These forward-looking statements are
made as of the date of this news release and are expressly qualified
in their entirety by this cautionary statement. Subject to applicable
Canadian securities laws, the company assumes no obligation to update
or revise the forward-looking statements contained herein to reflect
events or circumstances occurring after the date of this news
Ivanhoe Mines Ltd. - Investors
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