IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF)
IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF) is an exploration and mining company with its offices in Vancouver, British Columbia, Canada, but its operations are in sub-Saharan Africa. Ivanhoe Mines, and its founder Robert Friedland, first began work in South Africa in 1994 and in the Democratic Republic of the Congo (DRC) in 1996. IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF) executes its business model by focusing on exploration within the Central African Copperbelt, located mostly in the DRC, and on the northern limb of the Bushveld Complex, located mostly in South Africa. Ivanhoe Mines currently holds three main assets.
The Kamoa-Kakula Project was the reulst of exploration and discovery by Ivanhoe Mines. It yields high-grade copper form and area that was previously believed to be beyond that western limit of the Central African copper-belt. The Kamoa-Kakula project is located in Lualaba
Province, DRC. The Platreef Project, on the northern limb of the Bushveld Complex, in South Africa, is the result of the company’s discovery of gold, nickel, and copper deposits. The Kipushi Project, located in the Central African Copperbelt, in Haut-Katanga Province, DRC, is a former producing copper and zinc mine that was acquired by IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF). Ivanhoe mines also holds interests in potential mineral properties in the DRC including lands totaling 1,400km2 in Lualaba and Haut-Katanga provinces, around the perimeter of the popularly accepted, and historical, limits of the Central African Copperbelt.
In Q1 2016, IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF) completed an independent pre-feasibility study of the Kamoa Project. The Kamoa PFS reported an after-tax net present value (NPV), using an 8% discount rate, of $986 million and an internal rate of return (IRR) of 17%. The first phase of development is expected achieve an average copper production of 100,000 tons per year. In Q2 2016, Ivanhoe Mines completed an independent Preliminary Economic Assessment of the Kipushi Project. The Kipushi PEA reported an after-tax NPV, with an 8% discount rate, of $533 million and an IRR of 31%. The development plan envisages a 10-year mine life and reaches an average zinc production of 281,000 tons per year. In Q4 2016, Kamoa Holding Limited, an Ivanhoe Mines subsidiary, transferred 15% of the outstanding Class A shares of Kamoa Copper SA, to the DRC government. In return the DRC made a nominal cash payment and provided sought-after guarantees.
IVANHOE MINES LTD COM NPV CL’A’ (OTCMKTS:IVPAF) reported, for FY2016, a net income loss of (-$45.9) million. Total assets were listed at $1 billion and total liabilities were listed at $84.9 million.
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About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.