Ivanhoe Electric's Santa Cruz Copper Project: A New Era for US Copper Production

Ivanhoe Electric's Santa Cruz Copper Project in Arizona has unveiled a Preliminary Feasibility Study (PFS) that highlights a high-quality underground mining operation with robust economics. The study projects a 23-year mine life, significant copper production, and strong financial returns, positioning the project as a key domestic copper producer.

Economic Highlights and Project Scope

The Santa Cruz Copper Project demonstrates compelling financial viability, with an after-tax Net Present Value (NPV) of $1.9 billion and an Internal Rate of Return (IRR) of 24.0% at current COMEX copper prices. The project boasts low initial capital expenditure and competitive operating costs.

• After-Tax Net Present Value (NPV): $1.9 billion (at $4.83/lb COMEX copper price)
• Internal Rate of Return (IRR): 24.0% (at $4.83/lb COMEX copper price)
• Initial Capital: $1.24 billion
• Life of Mine C1 Cash Costs: $1.32 per pound of copper
• Mine Life: 23 years
• Total Copper Cathode Production: 1.4 million tonnes

Strategic Importance and Domestic Production

Robert Friedland, Executive Chairman of Ivanhoe Electric, emphasized the project's critical role in bolstering domestic mineral production, aligning with national security imperatives. The Santa Cruz project aims to produce 99.99% pure LME Grade A copper cathode, directly supporting American industries without reliance on international processing.

Taylor Melvin, President and CEO, highlighted the project's high-quality asset on private land with excellent infrastructure in Arizona, a state with a rich mining history. The project is expected to create high-paying jobs and contribute significantly to the U.S. copper supply.

Mining and Processing Details

The PFS outlines a modern underground mining operation utilizing advanced technologies and a simplified heap leach process. Key operational aspects include:

• Probable Mineral Reserves: 136 million tonnes at 1.08% copper grade, totaling 1.5 million tonnes of contained copper.
• Mining Operation: 20,000 tonnes per day, primarily using longhole stoping and local drift-and-fill methods.
• Processing: Conventional chloride-assisted on/off heap leaching, yielding high copper recoveries of 92.2% over the mine life.
• Annual Copper Production: Average of 72,000 tonnes of copper cathode during the first 15 years.

Development Timeline and Permitting

The project benefits from its location on 100%-owned private land, streamlining the permitting process. Initial construction is targeted for the first half of 2026, with the first copper cathode production projected for 2028.

Future Expansion Potential

Beyond the current mine plan, the Santa Cruz Copper Project holds substantial potential for future expansion. Indicated Mineral Resources, exclusive of current reserves, amount to 1.5 million tonnes of contained copper, offering near-mine expansion opportunities. Additionally, Inferred Resources of 3.3 million tonnes of contained copper across multiple deposits could further extend the project's life and scale with future studies and infrastructure development.

Sources

• Ivanhoe Electric's Preliminary Feasibility Study for the Santa Cruz Copper Project in Arizona Defines a
  High-Quality Underground Mining Operation with Strong Economics, Junior Mining Network.