Ivanhoe Australia has reached a significant milestone in its vision of becoming a major base-metals producer with the first production of copper and gold concentrate at its Osborne processing facility in northwest Queensland.

The company’s chief executive officer Peter Reeve says, “The commencement of copper-gold production at the Osborne facilities is an important first step in what we envisage will be the creation of a strong cashflow stream for 15 to 20 years.

“With our inexpensive acquisition of Osborne, the start of road construction to the Starra copper and gold mines, and our recent exploration successes around Osborne and Starra, we believe a long mine life is assured.”

Ivanhoe acquired the Osborne complex south of Cloncurry in late 2010 and then developed the Kulthor underground resource while restarting the Osborne underground mine.

Peter Reeve says the substantial exploration and resource definition efforts, near the mine at Osborne and also to the north along the Starra Line, is continuing to build the company’s understanding and definition of the field, reinforcing confidence in the projected mine life of 15 to 20 years.

The project has been ahead of schedule since its successful commissioning in late January progressed to initial production of concentrate in February and the official start of production on March 7. The achievement of steady-state concentrate production has resulted in the first haulage of concentrate to the Townsville port.

Hourly throughput at the processing plant has ramped up to 220 tonnes of ore for an annual rate of 1.65 million tonnes, which is in line with the original ramp-up schedule. Production throughput at the Osborne plant for 2012 is expected to be about 700,000 to 900,000 tonnes of ore and 1.8-2.0 million tonnes in 2013.

Mining at the Osborne and Kulthor underground mines is well under way and work on the Starra 276 decline began in December 2011 with the firing of the first stripping blast. The existing decline at Starra 276 is in excellent condition and is being widened to enable access by larger, more modern haulage trucks. Ore production is scheduled to begin in 2013. The construction of the Osborne-Mount Dore haul road is scheduled for completion by October 2012.

“This haul road is an important piece of infrastructure, not only for our production requirements but also because it allows the substantial assets at the Osborne operating complex to be utilized throughout Ivanhoe Australia’s northern tenements,” says Peter Reeve.

www.ivanhoeaustralia.com

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