[LeftCoaster]

Ivanhoe's investment agreement with Mongolian government takes effect
By The Canadian Press
ULAANBAATAR, Mongolia - An investment agreement between Ivanhoe Mines (TSX:IVN) and the Mongolian government for a massive copper and gold project has taken full legal effect.

Mongolia announced Wednesday that procedural and administrative conditions in the agreement had been satisfied and that it will take effect immediately.

The agreement, signed in October, will see the Mongolian government take a 34 per cent interest in the Oyu Tolgoi copper-gold project.

Ivanhoe owns the other 66 per cent and international mining giant Rio Tinto PLC (NYSE:RTP) also holds a stake through its ownership of about 22 per cent of Ivanhoe. Rio Tinto holds options to increase that stake to 46.6 per cent over the next 19 months.

Ivanhoe said the finalized agreement "creates a stable and long-term regulatory, fiscal and legal environment for the project."

"After nine years of discoveries at Oyu Tolgoi, a big piece of the future of copper and gold in Asia is poised to become a reality," said Ivanhoe executive chairman Robert Friedland.

"With this investment agreement taking full effect, we now have a long-term partnership and a definitive blueprint to start building that future at Oyu Tolgoi," Friedland said.

Ivanhoe and Rio Tinto have approved a US$758-million budget to launch full-scale construction of Oyu Tolgoi by the second quarter of this year. Commercial production is expected to begin in 2013.

In addition to Oyu Tolgoi, Ivanhoe has interests in coal, gold and copper resources in Mongolia, Australia and Kazakhstan.

Shares in Ivanhoe gained 39 cents or 2.25 per cent to $17.71 in early afternoon trading Wednesday on the Toronto Stock Exchange.

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