Ivanhoe and Zijin are using six rigs to further define the Kamoa-Kakula mineralization.

Ivanhoe discovered the Kamoa deposit in 2008 and the Kakula deposit, 5 kilometers (km) southwest of Kamoa, in late 2015. The Kakula mineralization is substantially richer, thicker and more consistent than mineralization at Kamoa.

Development options considered in the current PEA start with a single, 4-millionmetric- tons-per-year (mt/y) Phase 1 mine on the Kakula deposit that would produce an average of 216,000 mt/y of copper in concentrate at a mine-site cash cost of $0.37 per pound (lb) of copper over the first 10 years of operations. Mill feed would have an average grade of 7.52% copper during the initial five years of operations. Very-high-grade copper concentrates would average more than 50% contained copper, with extremely low arsenic levels.

Phase 1 project life is estimated at 23 years. Pre-production capital cost is estimated at $1.0 billion. A second option for the Kamoa-Kakula project would be to develop two mines, one at Kakula and another at Kamoa, producing an combined average of 8 million mt/y. Copper contained in concentrate would average 292,000 mt/y at a minesite cash cost of $0.42/lb of copper over the first 10 years of operations. Pre-production capital cost of this option is also estimated at $1 billion.

Ivanhoe’s options for Kamoa-Kakula project do not end there. The second PEA now in progress is assessing the potential for an initial stand-alone, 8-million-mt/y mine at Kakula, plus expanded, combined mining scenarios of 12 million mt/y and 16 million mt/y from the Kakula and Kamoa deposits.

The current Kamoa-Kakula project’s PEA was independently prepared by Ore- Win Pty. Ltd., Amec Foster Wheeler E&C Services and SRK Consulting Inc. The Kamoa-Kakula project is a joint venture between Ivanhoe Mines, Zijin Mining Group and the government of the DRC. Ivanhoe and Zijin each hold an indirect 39.6% interest in the project, the DRC government holds a direct 20% interest and Crystal River Global Ltd. holds an indirect 0.8% interest.

Ivanhoe and Zijin are continuing exploration drilling in and around the Kakula deposit area, using six drill rigs, to expand the extent of the known mineralization and support potential upgrades in resource confidence categories. Ivanhoe expects to issue an updated resource for the Kakula deposit in the first quarter of 2017.

Regarding ongoing Kamoa-Kakula project development, Ivanhoe CEO Lars-Eric Johansson said, “We will be working with our partners Zijin Mining and the DRC government to develop Kamoa- Kakula into the world’s next great copper mine, generating widely shared economic benefits that will help to sustain communities, and deliver jobs and skills training, in conjunction with effective environmental management.”