Ivanhoe’s Kamoa-Kakula mine produced 116,313t Cu-in-concentrate in Q3 vs 100,812t Cu in Q2, as the Phase 3 concentrator ramps-up. Kamoa-Kakula’s full year production has been revised down due to power supply issues, but the mine expansion remains on track. 

Ivanhoe’s 39.6% owned Kamoa-Kakula mine in the Democratic Republic of the Congo (DRC) produced 393,551t Cu-in-concentrate in 2023, becoming the world’s fifth largest copper mine and the DRC’s largest. The Phase 3 concentrator, commissioned in June, should run at capacity in Q4, with a targeted 86% recovery rate, and will increase Kamoa-Kakula’s production capacity to 600ktpy. However, Ivanhoe has downgraded its full year production guidance from 440-490kt Cu to 425-450kt Cu, because of the loss in production due to intermittent grid power. This was in particular prior to the installation of additional on-site generator capacity and agreements in place to import power to support power consumption from the DRC grid.  

At the end of Q3, total on-site backup power generation capacity was 135MW, sufficient to power Kamoa-Kakula’s Phase 1 and 2 concentrators at full capacity in the event of intermittent power. Kamoa’s plans remain on schedule to have 200MW of installed on-site backup power generation capacity by year-end. 

Kamoa-Kakula also bears one of the world’s highest copper grade. In H1 2024, the average copper ore processed grade was ~5.3% Cu with a C1 cash cost of ~US$1.55/lb and a 2024 guidance of US$1.50-1.70/lb. The 500ktpy capacity smelter, expected to be completed by the end of the year, is forecast to drop the C1 cost per pound of payable copper by about 20%.  

Since late last year, Ivanhoe Mines started exporting copper through the Lobito Corridor, accessing the Atlantic Ocean at the Lobito port, Angola, allowing for an export diversification for Ivanhoe and the DRC. The agreement with the Lobito Atlantic Railway allocates Ivanhoe with a 120-240ktpy volume from 2025. Most of the DRC copper exports transit through Zambia by road, connecting with ports on the Indian Ocean.    

High grades, low production costs and improved logistics have recently played in favour of the DRC, which, thanks to Kamoa-Kakula and to Tenke Fungurume (80% owned by China Molybdenum), is forecast to bypass Peru in 2024 and become the world’s second largest copper producer after Chile. In 2023, the DRC’s copper production was 2.7Mt, and it is forecast to exceed 3Mt in 2026 compared to 2.7Mt for Peru and 5.1Mt for Chile.