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Palladium prices continue to surge to new record highs, topping $1,800 an ounce as stricter air-quality rules boost demand for the metal used in vehicle pollution-control devices.

The price increase has propelled Ivanhoe’s Platreef Project ‘metals-price basket’ to a new, multi-year high.

Ivanhoe Mines is investigating an alternative production plan for the Platreef Project, targeting significantly lower initial capital, to accelerate first production by using Shaft 1 as the mine’s initial production shaft.

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This plan will focus on initially targeting the development of mining zones accessible from Shaft 1 and maximizing the hoisting capacity of this shaft, followed by expansions to the production rate as outlined in the DFS.

Shaft 1 now extends to a depth of more than 953 m below surface

Shaft 1 reached the top of the high-grade Flatreef Deposit (T1 mineralized zone) at a depth of 780.2 metres below surface in Q3 2018 and has since been extended to a depth of more than 950 metres below surface.

The thickness of the mineralized orebody (T1 and T2 mineralized zones) at Shaft 1 is 29 m, with grades of platinum-group metals ranging up to 11 (g/t) 3PE (platinum, palladium and rhodium) plus gold, as well as significant quantities of nickel and copper.

The 29-m intersection yielded approximately 3,000 tonnes of ore, estimated to contain more than 400 oz of platinum-group metals - including palladium. The ore is stockpiled on surface for further metallurgical sampling.

The 750-metre-level and 850-metre-level stations have both been completed with the 950-metre-level station currently in development.

Development is being carried out on the north drift of the 950-metre-level to accommodate a temporary refuge bay and rock handling arrangements facilitating early development from Shaft 1.

The final shaft bottom depth has been revised to 1,000 metres below surface in order to cater for a long-term life of mine spillage arrangement. This projected final depth is expected to be reached in mid-2020.

The three development stations will provide initial, underground access to the high-grade ore-body, enabling mine development to proceed concurrently with the construction of Shaft 2.

Shaft 2, to be located approximately 100 m northeast of Shaft 1, will have an internal diameter of 10 m. It will be lined with concrete and sunk to a planned, final depth of more than 1,104 m below surface.

It will be equipped with two Koepe winding plants, one equipped with 40-tonne rock-hoisting skips capable of hoisting a total of 6 Mt of ore a year – the single largest hoisting capacity at any mine in Africa.

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The headgear for the permanent hoisting facility was designed by South Africa-based Murray & Roberts Cementation.

The box-cut excavation to a depth of approximately 29 metres below surface, including the concrete foundation, has been successfully completed and will form the foundation of the 103-metre-tall concrete headgear that will house the shaft’s permanent hoisting facilities and support the shaft collar.

Work on Shaft 2 has been temporarily deferred while the company completes its review of the alternative production plan using Shaft 1 as the mine’s initial production shaft.

Underground mining to incorporate highly productive, mechanized methods

The mining zones in the current Platreef mine plan occur at depths ranging from approximately 700 m to 1,200 m below surface.

Planned mining methods will use highly productive, mechanized methods, including long-hole stoping and drift-and-fill mining.

Each method will utilize cemented back-fill for maximum ore extraction. As per the DFS, the ore will be hauled from the stopes to a series of internal ore passes and transferred to the bottom of Shaft 2 via inter-level ore passes, where it will be crushed and then hoisted to surface.