News Release dated March 23, 2006
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
From: March 23, 2006
IVANHOE MINES LTD.
(Translation of Registrants Name into English)
Suite 654
999 CANADA PLACE, VANCOUVER, BRITISH COLUMBIA V6C 3E1
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or will file annual reports under cover of
Form 20-F or Form 40-F.)
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Form 20-F- o
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Form 40-F- þ |
(Indicate by check mark whether the registrant by furnishing the information contained in this form
is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.)
(If Yes is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b): 82- .)
Enclosed:
Press Release
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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IVANHOE MINES LTD.
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Date: March 23, 2006 |
By: |
/s/ Beverly A. Bartlett
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BEVERLY A. BARTLETT |
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Corporate Secretary |
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March 23, 2006 |
Ivanhoe welcomes Mongolian Governments acceptance
of new initiatives to facilitate the completion of a Stability Agreement
for development of Oyu Tolgoi copper-gold project
Ivanhoes proposed parallel agreement
would ensure significant economic benefits for Mongolians
ULAANBAATAR, MONGOLIA The Board of Directors of Ivanhoe Mines today welcomed the Mongolian
Governments acceptance of a series of investment-related initiatives made by the company this week
to facilitate the completion of a Stability Agreement for the development of Ivanhoes Oyu Tolgoi
copper-gold project in the South Gobi region.
The initiatives were introduced to government leaders and senior officials earlier this week by an
Ivanhoe delegation led by Chairman Robert Friedland, and including President John Macken. The
meetings coincided with a recent series of encouraging statements from Mongolias political
leadership, including President N. Enkhbayar and Prime Minister M. Enkhbold, reaffirming their
commitment to the early conclusion of a Stability Agreement with Ivanhoe Mines and to maintaining a
positive environment for foreign investment.
In an official statement issued today on decisions taken at a cabinet meeting on Wednesday, March
22, the Mongolian Government announced that the cabinet had instructed the Minister of Finance and
the Minister of Industry and Trade to:
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Form a working group to conclude the negotiations on the Stability Agreement.
The working group should ensure conformity of the Stability Agreement with amendments to be
made to the Tax Law as well as to the Minerals Law by the upcoming spring parliamentary
session. |
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Conclude a mutually beneficial agreement on such issues as the employment of
Mongolian nationals by Ivanhoe, their minimum salaries and training for high-level jobs,
power supply and possible development of downstream smelting and refining. |
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Facilitate the listing of (Ivanhoes) common shares on the Mongolian Stock
Exchange, making it possible for Mongolians to own shares in the company. |
The reaffirmations of support for an early completion of the Stability Agreement, and for foreign
investment, by Mongolias senior leaders followed the visit this week to Mongolia by James Baker
III, the 61st Secretary of State in the United States of America. Secretary Baker is widely
regarded as an especially close friend of Mongolia for his work in initiating a long-term program
of international aid finance to launch and secure the economic viability of the independent
Mongolian state in 1991, when the nation first embraced democratic and free-market economic
reforms.
Under Secretary Bakers direction, the donor country program was launched with a major American aid
package and grew to include many other nations, as well as the International Monetary Fund and the
World Bank. The program has channelled approximately US$1.5 billion in direct assistance
into Mongolia during the past 15 years.
Secretary Baker was in Ulaanbaatar this week at the invitation of the Mongolian Ambassador to the
U.S., Ravdan Bold, in recognition of the 800th anniversary of the Mongolian state that
was founded by Chinggis Khan, as part of a multi-faceted philanthropic and business trip to Asia.
Secretary Bakers law firm, Baker Botts, represents Ivanhoe Mines in various matters.
In a widely-reported speech to government officials and cabinet ministers, Secretary Baker said
that foreign investment can bring strategic and political benefits, as well as economic benefits,
to a small, developing country wedged between two superpowers. Secretary Baker cautioned the
government representatives that the whole world was watching Mongolias progress and investors must
have confidence in the rules that are established. It is in Mongolias interests to be known as a
place where an agreement that is made is an agreement that sticks; where the rule of law and
sanctity of contract are abiding principles.
Secretary Baker discussed the state of Mongolias investment climate with the President and Prime
Minister and later told a news conference organized by the Foreign Affairs Ministry: We were very
pleased with our meetings. I think that the government of Mongolia understands the importance of
being seen to be a country that is hospitable to foreign investment.
In a statement issued March 22, President Enkhbayar paid tribute to Secretary Bakers invaluable
efforts in supporting the development of democracy in Mongolia. The President also said he agreed
that negotiations need to be concluded with Ivanhoe for a Stability Agreement and that Mongolia
needs to be conscious of the importance of foreign investment to its economic development.
Prime Minister Enkhbold issued a statement expressing his appreciation for Secretary Bakers
leadership in ensuring U.S. support and assistance as a third neighbour and a bilateral partner
in economic and security issues.
The Prime Ministers statement said, in part: Mr. Baker pointed out the concerns of the world
capital markets about the fact that the Stability Agreement proposed between the Government and
Ivanhoe Mines of Canada is still pending and had very open and frank discussions with the Prime
Minister on that issue. The Cabinet, formed two months ago, has been well aware of this issue since
the very beginning (of the recent new government) and issued a directive whereby it assigned the
Minister of Finance and the Minister of Industry and Trade to conclude the negotiations with
Ivanhoe. The statement also said that the Prime Minister advised Mr. Baker that the preparations
for the talks are being completed to conclude the negotiations on the Stability Agreement terms
shortly.
Parallel agreement to guarantee benefits
Ivanhoe has proposed that the new investment-related initiatives that now have been accepted
by the Mongolian government would form part of a parallel agreement that would be negotiated by
Ivanhoe Mines and the government in conjunction with the Stability Agreement which is
contemplated under existing Mongolian law.
In their meetings with government officials this week, Ivanhoes representatives, including
independent director Howard Balloch, a former Canadian Ambassador to Mongolia, and senior
management team members, said the company has invested more than US$300 million in
exploration and preliminary development of the Oyu Tolgoi mineral deposits. The deposits delineated
to date include proven and probable reserves sufficient to commit to mine construction. The
reserves have been independently verified to rigorous international standards by GRD Minproc Ltd.,
of Perth, Australia, in accordance with Canadian and
American regulatory reporting requirements. The company, through its wholly-owned subsidiary
Ivanhoe Mines Mongolia Inc., holds a long-term mining licence for the deposits and is preparing to
make major capital commitments, on the basis of the independently verified, proven and probable
reserves, in excess of US$1.2 billion for construction of the first phase of the mining
project.
Ivanhoe proposed that in addition to a project Stability Agreement, the government and the company
should negotiate a parallel agreement that would guarantee additional benefits that Ivanhoes
representatives said would be nothing but good news for Mongolians as the Oyu Tolgoi project
proceeds. The parallel agreement would contain provisions covering the employment and
skills-training and minimum wages of Mongolians on the project, which is expected to create 10,000
new jobs in construction and 3,000 jobs during mining operations. The agreement also would provide
for the provision of interim power supply and the production of long-term electrical power
generation in the South Gobi region as well as a commitment by Ivanhoe to work with the Mongolian
government to have downstream smelting capacity built in Mongolia. Copper smelting capacity also
could serve the large, existing Erdenet copper mine and other proposed copper mines, such as
Tsagaan Suvarga, also located in the Gobi region.
Through this innovative approach, we can create an additional win-win agreement for the
government, the people of Mongolia, the shareholders of Ivanhoe Mines and all stakeholders in the
development of Oyu Tolgoi, said Mr. Macken, President of Ivanhoe Mines.
Forward-Looking Statements: This document includes forward-looking statements.
Forward-looking statements include, but are not limited to, statements concerning the Oyu Tolgoi
Stability Agreement and development program, pre-feasibility studies and planned mining, and other
statements that are not historical facts. When used in this document, the words such as could,
plan, estimate, expect, intend, may, potential, should, and similar expressions are
forward-looking statements. Although Ivanhoe Mines believes that its expectations reflected in
these forward-looking statements are reasonable, such statements involve risks and uncertainties
and no assurance can be given that actual results will be consistent with these forward-looking
statements. Important factors that could cause actual results to differ from these forward-looking
statements are disclosed under the heading Risk Factors and elsewhere in the corporations
periodic filings with Canadian and US securities regulators.
Information contacts
North America
Investors: Bill Trenaman 604 688 5755
Media: Bob Williamson 604 331 9880
Mongolia
Layton Croft 976 9911 3339