Robert Friedland, Executive Chairman of Ivanhoe Mines (TSX:
IVN)(NYSE: IVN)(NASDAQ: IVN), and John Macken, President and Chief
Executive Officer, announced today that Ivanhoe Mines has appointed
BNP Paribas, Standard Chartered and Export Development Canada to
the core lender group of five financial institutions that will lead
the arrangement of a project finance debt package for the Oyu
Tolgoi copper and gold mining complex in Mongolia.
"The completion of the assembly of the core lender group is a
key step in the process of securing the Oyu Tolgoi financing
package, which we expect to close in the first quarter of 2011,"
Mr. Friedland said.
"The five financial institutions have indicated that they are
prepared to consider providing limited recourse loans that would
total more than US$2 billion, demonstrating the high level of
interest in international financial circles in participating in the
project and awareness of its game-changing significance to copper
and gold markets."
Mr. Friedland said that Ivanhoe Mines had evaluated expressions
of interest from 13 banks and selected Paris-based BNP Paribas and
London-based Standard Chartered to work with the European Bank for
Reconstruction and Development (EBRD), the International Finance
Corporation (IFC) and Export Development Canada (EDC) in arranging
the financing.
"As leading global institutions, BNP Paribas and Standard
Chartered have a very strong presence in Asia and, consistent with
the commitments of the other core lenders, have indicated that they
are considering retaining a significant exposure to the Oyu Tolgoi
project debt through a mix of facilities," Mr. Friedland said. The
facilities include EBRD and IFC "B" loans, facilities backed by
export credit agencies and commercial loans.
Ivanhoe Mines announced in May that it had signed a joint
mandate letter with the EBRD and the IFC for evaluation of a major
financing package for the construction of the planned Oyu Tolgoi
mining complex.
Under the terms of the mandate letter, the IFC, part of the
World Bank Group, and the EBRD will consider directly providing up
to US$600 million, representing approximately US$300 million each
from the IFC and the EBRD, as part of a group of primary lenders in
limited-recourse project financing.
Export Development Canada (EDC), the Canadian government's
export credit agency, is considering providing up to US$500 million
in direct project financing capacity, subject to necessary
approvals, including ensuring that the Oyu Tolgoi Project meets
EDC's environmental and social impact review requirements.
Significant support for the Oyu Tolgoi financing also is
expected from commercial lenders under "B" loan structures and
under the guarantee schemes of other export credit agencies.
Ivanhoe is discussing additional financing options for the balance
of its capital requirements.
The independent 2010 Oyu Tolgoi Integrated Development Plan
(IDP-10) estimated that the initial capital cost required to
achieve first production from the open-pit mine on the Southern Oyu
deposits would be US$4.6 billion. This amount includes US$1.1
billion to be spent advancing underground development at the Hugo
North Deposit in preparation for the start of block-cave mining
following the start of production from the open pit.
Mr. Macken confirmed that the Oyu Tolgoi Project will be
developed to allow EDC and the commercial banks involved in the
financing to comply with the Equator Principles, a set of voluntary
international guidelines based on the IFC's social and
environmental performance standards.
Hatch Corporate Finance advised Ivanhoe Mines on the selection
of BNP Paribas and Standard Chartered.
About Ivanhoe Mines (www.ivanhoemines.com)
Ivanhoe Mines (TSX: IVN)(NYSE: IVN)(NASDAQ: IVN) is an
international mining company with operations focused in the Asia
Pacific region. Assets include the company's 66% interest in the
world-scale, Oyu Tolgoi copper-gold mine development project in
southern Mongolia; its 57% interest in Mongolian coal miner
SouthGobi Resources (TSX: SGQ; HK: 1878); an 81% interest in
Ivanhoe Australia (ASX: IVA), a
copper-gold-uranium-molybdenum-rhenium exploration and development
company; and a 50% interest in Altynalmas Gold Ltd., a private
company developing the Kyzyl Gold Project in Kazakhstan.
About BNP Paribas (www.bnpparibas.com)
BNP Paribas is one of the six strongest banks in the world by
Standard & Poor's and is the largest bank in the Eurozone by
deposits. With a presence in more than 80 countries and more than
200,000 employees, including 160,000 in Europe, BNP Paribas is a
leading European provider of financial services on a worldwide
scale. It ranks highly in its three core activities: Retail
Banking, Investment Solutions and Corporate & Investment
Banking. In its Corporate & Investment Banking and Investment
Solutions activities, BNP Paribas also enjoys top positions in
Europe and solid and fast-growing businesses in Asia.
About Standard Chartered (www.standardchartered.com)
Standard Chartered PLC is a leading international bank, listed
on the London, Hong Kong and Mumbai stock exchanges. It has
operated for more than 150 years in some of the world's most
dynamic markets and earns around 90 per cent of its income and
profits in Asia, Africa and the Middle East. The bank's growth in
recent years has been driven by this geographic focus and
commitment to developing deep relationships with clients and
customers. Standard Chartered is committed to building a long-term
sustainable business and upholds high standards of corporate
governance, social responsibility, environmental protection and
employee diversity.
About Export Development Canada (www.edc.ca)
Export Development Canada (EDC) is Canada's national export
credit agency, offering innovative commercial solutions to help
Canadian exporters and investors expand their international
business. EDC's knowledge and partnerships are used by more than
8,400 Canadian companies and their global customers in up to 200
markets worldwide each year. EDC is financially self-sustaining, a
recognized leader in financial reporting and economic analysis, and
has been recognized as one of Canada's Top 100 Employers for nine
consecutive years.
Forward-looking statements
Certain statements made herein, including statements relating to
matters that are not historical facts and statements of our
beliefs, intentions and expectations about developments, results
and events that will or may occur in the future, constitute
"forward-looking information" within the meaning of applicable
Canadian securities legislation and "forward-looking statements"
within the meaning of the "safe harbor" provisions of the United
States Private Securities Litigation Reform Act of 1995.
Forward-looking information and statements typically are identified
by words such as "anticipate", "could", "should", "expect", "seek",
"may", "intend", "likely", "plan", "estimate", "will", "believe"
and similar expressions suggesting future outcomes or statements
regarding an outlook. These include, but are not limited to, Oyu
Tolgoi becoming one of the world's largest copper and gold
producers; the objective of attaining commercial production at Oyu
Tolgoi in 2013; the target of the first quarter of 2011 for
completion of the debt financing package; the estimated initial
capital cost required to achieve first production from the open-pit
mine on the Southern Oyu deposits of US$4.6 billion; the estimated
US$1.1 billion to be spent advancing underground development at the
Hugo North Deposit in preparation for the start of block-cave
mining; additional potential debt, equity offerings, a credit
facility, the sale of subsidiaries, equity investments, project
financing and/or various corporate transactions; that the Oyu
Tolgoi Project will be developed to allow the commercial banks
involved in the financing to comply with the Equator Principles;
and other statements that are not historical facts.
All such forward-looking information and statements are based on
certain assumptions and analyses made by Ivanhoe Mines' management
in light of their experience and perception of historical trends,
current conditions and expected future developments, as well as
other factors management believes are appropriate in the
circumstances. These statements, however, are subject to a variety
of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected
in the forward-looking information or statements. Important factors
that could cause actual results to differ from these
forward-looking statements include those described under the
heading "Risks and Uncertainties" elsewhere in the Company's
MD&A filed on SEDAR. The reader is cautioned not to place undue
reliance on forward-looking information or statements.
Contacts: Ivanhoe Mines Ltd. Bill Trenaman Investor Contact
+1.604.688.5755 Ivanhoe Mines Ltd. Bob Williamson Media Contact
+1.604.331.9830 www.ivanhoemines.com
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