The company says “several leading international mining companies” have contacted it regarding a possible transaction relating to the project.
Last September, Ivanhoe said it was looking at as many as 16 “unsolicited contacts” from international mining companies interested in Oyu Tolgoi. But Ivanhoe CEO Robert Friedland stressed that his company intends to be the builder of Turquoise Hill, not its auctioneer. “This is not Voisey’s Bay all over again,” he said.
At last count, Oyu Tolgoi contained an inferred resource of 1.28 billion tonnes grading 1.13% copper and 0.24 gram gold, equivalent to 14.6 million tonnes (30.1 billion lbs.) copper and 9.7 million oz. gold. The estimates are based on a copper-equivalent cutoff grade of 0.6%. The Southwest Oyu deposit hosts an additional indicated resource of 267 million tonnes grading 0.53% copper and 0.86 gram gold, equivalent to 1.4 million tonnes (3.1 billion lbs.) copper and 7.3 million oz. gold, at a cutoff grade of 0.6% copper-equivalent.
An updated resource estimate is expected in the next few weeks, with a revised scoping study due for release in June.
Ivanhoe owns the Oyu Tolgoi project and holds or controls around 111,000 sq. km worth of exploration rights in central and southern Mongolia.
In February, an independent scoping study based on a minable inventory of around 1 billion tonnes averaging 0.95% copper and 0.26 gram gold per tonne proposed an operation that would support a 20-million-tonne-per-year flotation plant for 29 years. The plan calls for the addition of a second milling circuit to double production in year five. The capital cost for the first phase is pegged at US$529 million, with the overall cost of both stages estimated at US$1.17 billion (T.N.M., March 8-14/04).
Ivanhoe reported a loss of US$73 million (or 3 per share) for 2003, compared with 2002 loss of US$31 million (or 16 per share). The more recent loss includes exploration expenditures of US$68 million, most of which was spent at Oyu Tolgoi, where the company accelerated drilling on the Hugo Dummett deposit.
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