Ivanhoe jumps on plan to restart DRC copper mine

Ivanhoe Mines’ (TSX: IVNl US-OTC: IVPAF) plans to dewater the Kakula copper mine in the Democratic Republic of Congo could restore operations as early as this month. Its shares rebounded.

The underground mine, part of the larger Kamoa-Kakula copper complex in the DRC, was temporarily suspended on May 18 following seismic activity caused severe flooding. The complex, Africa’s largest copper-producing operation, has increased pumping to about 4,400 litres per second in the first stage of remediation, enough to stabilize water levels, BMO Capital Markets mining analyst Andrew Mikitchook said. 

“This is a clear improvement and hopefully establishes a trajectory for further positive news over the next few weeks,” Mikitchook said in a note on Monday. “The next key milestone should be the restart of mining in the western part of Kakula ‘later this month,'” he said, quoting Ivanhoe. 

The site’s Phase 1 and 2 concentrators continue to process ore from surface stockpiles while operating at about half of capacity. Ivanhoe plans an update next week that should show results from geotechnical investigations.

Shares in Ivanhoe Mines gained 4.8% to $11.14 apiece on Monday afternoon in Toronto, valuing the company at $15 billion. 

Remediation

The company said May 26 it was reviewing this year’s production guidance of of 520,000 to 580,000 tonnes from the Kamoa-Kakula complex.

Ivanhoe and China’s Zijin Mining each hold 39.6% of the site while the DRC government has a 20% stake. Despite conflicting reports from the partners over the damage, mining analysts have said the mine should be able to resume once the necessary dewatering and remediation efforts are completed.

Ivanhoe’s engineering team is working on a dewatering plan that would see the western side of the mine, which remains dry, to return to operations this month. The eastern side, where the initial seismic activity occurred, will restart once the entire dewatering process is complete, the Canadian miner said.

Two-stage plan

The dewatering plan comprises two stages: 1) installation of temporary underground pumping infrastructure to stabilize and maintain current water levels; and 2) installation of four high-capacity, surface-mounted pumps to add 650 litres per second of capacity each and new permanent infrastructure to fully dewater the underground mine.

Ivanhoe said its team has already completed stage one while stage two delivery and installation is expected within 90 days, the company said.

Since mining operations began at Kakula in 2021, crews have completed over 18 months’ worth of underground development ahead of the mine plan. This advance development provides flexibility, allowing access to multiple production areas as they are deemed safe for re-entry, Ivanhoe said.

Operations at the Kamoa underground mine and the adjacent Phase 3 concentrator remain unaffected and continue as normal, it added.