Ivanhoe Australia began producing copper and gold concentrate at its Osborne processing facilities south of Cloncurry, northwest Queensland, on February 28.

The company acquired the Osborne mine and concentrator from Barrick Australia in September 2010. Since the acquisition, the company has restarted the Osborne underground mine and developed the Kulthor underground resource, which is accessed via a decline from the Osborne mine. Potential additional future ore sources include the Starra 276 and Starra 222 deposits and the existing Osborne open-pit.

Commissioning of the Osborne concentrator began in late January 2012, and first concentrate was shipped to Townsville Port March 7. Plant throughput has ramped up to 220 mt/hr, an annualized rate of 1.65 million mt, assuming 95% utilization. Throughput during 2012 is expected to total between 700,000 and 900,000 mt, increasing to 1.8 million to 2 million mt in 2013. At startup, approximately 80,000 mt of ore were stockpiled on the run-of-mine pad, providing a buffer of around 20 days of plant production.

Work on the existing Starra 276 decline began in December 2011. The decline is being widened to enable access by larger, more modern haulage trucks. A bypass is also being mined around a tight spiral section of the old decline. The decline development is being undertaken by a mining contractor, with ore production scheduled to begin in the first quarter of 2013.

Substantial exploration and resource definition efforts are continuing to build Ivanhoe Australia’s understanding and definition of the ore field, reinforcing confidence in the projected mine life of 15 to 20 years, CEO Peter Reeve said. At Kulthor, a surface drilling program has begun to test the southwest along-strike and down-plunge extensions of mineralization, and at Osborne Deeps, drilling for resource extensions north of the planned mining area and existing decline are under way, utilizing various geophysical targeting methods.