Katanga Mining Announces 2018 Second Quarter Production Results and Date of Release of 2018 Second Quarter Financial Results

ZUG, Switzerland, July 30, 2018 /CNW/ - Katanga Mining Limited (TSX: KAT) ("Katanga" or the "Company") today announces its 2018 second quarter production results and date of release of 2018 second quarter financial results. Katanga's unaudited interim financial statements and accompanying Management's Discussion and Analysis will be filed on SEDAR, www.sedar.com.

Production highlights during the three and six months ended June 30, 2018

Commissioning and resumption of production after 2015 suspension

On September 11, 2015, the Company announced the decision to suspend the processing of copper and cobalt during the construction phases of the whole ore leach project ("WOL Project"). The suspension continued throughout most of 2017 with copper production resuming on December 11, 2017.

• During Q2 2018, construction continued on phase 2 of the WOL Project. Progress was made on the high-grade clarifier, receiving thickener and the post-leach clarifier for copper production. The core copper circuit of train 2 is expected to be completed and commissioned during Q3 2018. The final components of the WOL Project being the train 2 counter current decantation ("CCD") wash circuits and electro-winning tank house are scheduled for completion and commissioning by Q4 2018; and
  
  
• Copper cathode production has increased to 35,615 tonnes in Q2 2018 from 27,677 tonnes in Q1 2018. Cobalt contained in hydroxide has increased to 2,429 tonnes in Q2 2018 from 525 tonnes in Q1 2018. The increase in copper cathode and cobalt contained in hydroxide are related to the ongoing ramp-up of production and the commissioning and re-commissioning of related assets.

Mining

		Three months ended			Six months ended
		Jun 30,	Mar 31,	Jun 30,	Jun 30,	Jun 30,
		2018	2018	2017	2018	2017
Ore mined*
KOV open pit	tonnes	1,894,752	775,393	-	2,670,145	-
Mashamba East open pit	tonnes	885,791	626,808	-	1,512,599	-
Total open pits	tonnes	2,780,543	1,402,201	-	4,182,744	-
KTO underground	tonnes	73,685	-	-	73,685	-
Total ore mined	tonnes	2,854,228	1,402,201	-	4,256,429	-
Waste mined*
KOV open pit	tonnes	7,300,157	6,030,880	8,682,206	13,331,037	14,849,211
Mashamba East open pit	tonnes	5,141,270	3,308,558	3,513,785	8,449,828	4,881,019
Total open pits	tonnes	12,441,427	9,339,438	12,195,991	21,780,865	19,730,230
KTO underground	tonnes	43,393	39,816	-	83,209	13,365
Total waste mined	tonnes	12,484,820	9,379,254	12,195,991	21,864,074	19,743,595
Total material mined
KOV open pit	tonnes	9,194,909	6,806,274	8,682,206	16,001,182	14,849,211
Mashamba East open pit	tonnes	6,027,061	3,935,365	3,513,785	9,962,427	4,881,019
Total open pits	tonnes	15,221,970	10,741,639	12,195,991	25,963,609	19,730,230
KTO underground	tonnes	117,078	39,816	-	156,894	13,365
Total material mined	tonnes	15,339,048	10,781,455	12,195,991	26,120,503	19,743,595
Total contained copper	tonnes	58,350	28,761	-	87,111	-
Ore summary
Total primary ore mined	tonnes	1,374,441	644,344	-	2,018,785	-
Average Cu grade	%	3.54	3.92	-	3.66	-
Average Co grade	%	0.42	0.55	-	0.46	-
Total very low-grade ore mined	tonnes	689,071	204,815	-	893,886	-
Average Cu grade	%	1.01	1.08	-	1.03	-
Average Co grade	%	0.20	0.22	-	0.20	-
Total cobalt ore mined	tonnes	790,716	553,042	-	1,343,758	-
Average Co grade	%	0.68	0.51	-	0.61	-
Average Cu grade	%	0.35	0.23	-	0.30	-
Total ore mined	tonnes	2,854,228	1,402,201	-	4,256,429	-
Average Cu grade	%	2.04	2.05	-	2.05	-
Average Co grade	%	0.44	0.49	-	0.45	-

*The mining disclosure has been enhanced to include classification of ore volumes into different categories, being primary copper containing ore, very low-grade copper containing ore (but still above cut-off grade) and cobalt containing ore (that contains copper under the copper cut-off grade but cobalt over the cobalt cut-off grade). The primary ore component, defined as having a Cu grade of greater than 1.25%, the very-low grade component, defined as having a Cu grade between 0.65% and 1.25% and the cobalt ore component, defined as having a Cu grade of less than 0.65% and Co grade greater than 0.30%. A comparative has been shown for Q1 2018, which includes ore previously classified as waste due to its low-grade nature.

Total ore mined increased to 2,854,228 tonnes in Q2 2018 from 1,402,201 tonnes in Q1 2018. Total ore mined increased to 4,256,429 tonnes in H1 2018 from nil tonnes in H1 2017.

Total waste mined increased to 12,484,820 tonnes in Q2 2018 from 9,379,254 tonnes in Q1 2018. Total waste mined increased to 21,864,073 tonnes in H1 2018 from 19,743,595 tonnes in H1 2017.

Total contained copper increased to 58,350 tonnes in Q2 2018 from 28,761 tonnes in Q1 2018. Total contained copper increased to 87,111 tonnes in H1 2018 from nil tonnes in H1 2017.

The increase in total material mined in the open pits in Q2 2018 against Q1 2018 is relating to the seasonal transition from the rainy season to dry season which allowed for greater equipment utilization as well as the ongoing ramp-up of production, in line with the optimized mine plan following the resumption of ore mining activities in Q4 2017. It has been supported by the re-commissioning and commissioning of:

• six CAT 793D trucks for increased hauling capacity;
• one CAT D9R dozer related to the ongoing mining ramp-up;
• one CAT 6060 diesel shovel for increased mining capacity;
• two CAT 745 ADT lube trucks for increased ancillary work;
• one CAT CS74B compactor for road and access maintenance; and
• one CAT 745 ADT service truck to support production ramp-up.

The increase in total contained copper in Q2 2018 compared to Q1 2018 and H1 2018 compared to H1 2017 is driven by an increase in total ore mined due to the suspension of ore mining activity in the 2017 comparable periods and the subsequent resumption of production, in line with the optimized mine plan, to ensure sufficient ore availability for the WOL Project.

The increase in total material mined in the KTO underground in Q2 2018 against Q1 2018 and H1 2018 against H1 2017 is relating to the commencement of training in secondary development (ore) as well as the continuation of training in primary development (waste).

The increase in very low-grade ore and cobalt ore mined in Q2 2018 against Q1 2018 and H1 2018 against H1 2017 is relating to optimization of the long-term feed strategy; very low-grade ore and cobalt ore are currently being stockpiled for future feed into the processing plant.

Kamoto concentrator ("KTC")

		Three months ended			Six months ended
		Jun 30, 2018	Mar 31, 2018	Jun 30, 2017	Jun 30, 2018	Jun 30, 2017
Total material milled	tonnes	1,970,359	1,624,655	342,562	3,595,014	690,608
KITD material milled	tonnes	882,768	745,983	342,562	1,628,751	690,608
Cu grade in ore	%	1.66	1.43	1.26	1.56	1.27
Co grade in ore	%	0.17	0.17	0.14	0.17	0.15
Open pit ore milled	tonnes	1,044,821	878,672	-	1,923,493	-
Cu grade in ore	%	3.60	3.92	-	3.74	-
Co grade in ore	%	0.41	0.55	-	0.48	-
Underground ore milled	tonnes	42,770	-	-	42,770	-
Cu grade in ore	%	3.32	-	-	3.32	-
Co grade in ore	%	0.54	-	-	0.54	-
Production
Oxide concentrate	tonnes	47,347	33,768	10,324	81,115	21,592
Sulphide concentrate	tonnes	18,172	26,682	5,780	44,854	12,194
Total concentrate produced	tonnes	65,519	60,450	16,104	125,969	33,786
Cu grade in concentrate	%	18.56	16.39	14.96	17.52	14.44
Co grade in concentrate	%	1.38	0.95	0.89	1.17	0.96
Oxide feed received at Luilu	tonnes	1,020,106	819,200	-	1,839,306	-
Cu grade in oxide feed	%	2.98	3.06	-	3.02	-
Total contained copper	tonnes	42,612	34,996	2,396	77,608	4,880

Total material milled increased to 1,970,359 tonnes in Q2 2018 from 1,624,655 tonnes in Q1 2018. Total material milled increased to 3,595,014 tonnes in H1 2018 from 690,608 tonnes in H1 2017.

Total concentrate produced increased to 65,519 tonnes in Q2 2018 from 60,450 tonnes in Q1 2018. Total concentrate produced increased to 125,969 tonnes in H1 2018 from 33,786 tonnes in H1 2017.

Total oxide feed received at Luilu increased to 1,020,106 tonnes in Q2 2018 from 819,200 tonnes in Q1 2018. Total oxide feed received at Luilu increased to 1,839,306 tonnes in H1 2018 from nil tonnes in H1 2017.

Total contained copper in concentrate and oxide feed produced increased to 42,612 tonnes in Q2 2018 from 34,996 tonnes in Q1 2018. Total contained copper in concentrate and oxide feed produced increased to 77,608 tonnes in H1 2018 from 4,880 tonnes in H1 2017.

The increase in total material milled, concentrate and oxide feed received at Luilu and total contained copper in concentrate and oxide feed in Q2 2018 compared to Q1 2018 and H1 2018 compared to H1 2017 reflects the resumption of production in December 2017 following the completion of phase 1 of the WOL Project. Processing activities were largely suspended during the comparative periods in 2017. The increases for the year to date have been achieved by:

• increasing the capacity of the hydro mining station to treat KITD material at 500 tonnes per hour;
• an increase in total ore availability, in line with the optimized mine plan, to ensure sufficient ore availability for the WOL Project; and
• re-commissioning of two additional cascade mills to support increased sulphide material throughputs as well as the sulphide floatation circuit comprising of tank cells and two banks of Wemco cleaner cells.

Luilu metallurgical plant

		Three months ended			Six months ended
		Jun 30, 2018	Mar 31, 2018	Jun 30, 2017	Jun 30, 2018	Jun 30, 2017
WOL feed – oxide concentrate*	tonnes	83,676	86,445	-	170,121	-
WOL feed – oxide feed	tonnes	1,020,106	819,200	-	1,839,306	-
Total oxide feed	tonnes	1,103,782	905,645	-	2,009,427	-
Total oxide Cu grade	%	3.75	4.04	-	3.88	-
Total oxide Co grade	%	0.41	0.55	-	0.47	-
Sulphide roaster feed	tonnes	5,823	-	-	5,823	-
Sulphide Cu grade	%	33.78	-	-	33.78	-
Sulphide Co grade	%	4.02	-	-	4.02	-
Production
Copper cathode	tonnes	35,615	27,677	-	63,292	-
Cobalt contained in hydroxide	tonnes	2,429	525	-	2,954	-
*consists of amounts produced at KTC during comparable periods plus inventory drawdown.

Total copper cathode increased to 35,615 tonnes in Q2 2018 from 27,677 tonnes in Q1 2018. Total copper cathode increased to 63,292 tonnes in H1 2018 from nil tonnes in H1 2017.

Total cobalt contained in hydroxide increased to 2,429 tonnes in Q2 2018 from 525 tonnes in Q1 2018. Total cobalt contained in hydroxide increased to 2,954 tonnes in H1 2018 from nil tonnes in H1 2017.

The increase in copper cathode and cobalt contained in hydroxide in Q2 2018 compared to Q1 2018 and H1 2018 compared to 2017 reflects the resumption of production in December 2017 following the completion of phase 1 of the WOL Project. Processing activities were largely suspended during the comparative periods in 2017. The increases for the year to date have been achieved by:

• increasing total oxide feed to be leached in line with the ramp-up of operations;
• re-commissioning of the sulphide receiving circuit which comprise the thickeners and receiving tanks, roaster 5 and its associated auxiliary equipment and electro-winning 2; and
• commissioning of a low grade solvent extraction circuit, counter current decantation and the cobalt purification plant with the associated utility plants.

Major projects update

WOL Project

The WOL Project includes the construction of optimized copper and cobalt circuits intended to reliably produce up to 300,000 tpa of copper cathode over the life of the mine. This is achieved by adding additional leach capacity at Luilu in order to leach run-of-mine oxide ore directly rather than concentrating the oxide ore at KTC.

Q2 2018 update

• Construction has continued on phase 2 of the WOL Project. Progress was made on the high-grade clarifier, receiving thickener and the post-leach clarifier for copper production; and
  
  
• the core copper circuit of train 2 is expected to be completed and commissioned during Q3 2018. The final components of the WOL Project being the train 2 CCD wash circuits and electro-winning tank house are scheduled for completion and commissioning by Q4 2018.

Cobalt Projects

The objective of the cobalt projects is to upgrade the existing cobalt plant design in order to reduce the bottlenecks and increase production capacity up to 40,000 tpa of cobalt contained in hydroxide by modification to the precipitation, thickening and filtration and drying and bagging processes. The improvements being made as part of the cobalt projects will integrate with the existing WOL processing facilities at Luilu.

Q2 2018 update

• Demolition works have been completed to facilitate future construction, civil and earth works are underway in line with the project schedule and long lead items have been ordered; and
• Estimated completion for the cobalt projects is Q1 2019.

Acid Plant

In Q4 2017, the Board of Katanga approved a US$237 million capital expenditure spread over 2018 and 2019 to construct a sulphuric acid and sulphur dioxide production plant at KCC, which will improve the reliability of the supply of these reagents to the WOL processing circuits.

Q2 2018 update

• In addition to a continuation of design work on the Acid Plant, preliminary earth works have commenced and orders for major long lead items have been placed.

The Company expects to release its second quarter 2018 financial results on or about August 7, 2018.

Outlook

2018 full year guidance remains for 150kt of copper and 11kt of cobalt production.

Qualified Person

Tahir Usmani, PEng, APEGA, Chief Mine Planning Engineer of KCC, has reviewed and approved the scientific and technical disclosure in this news release. Mr. Usmani is a "qualified person" for the purposes of NI 43-101 - Standards of Disclosure for Mineral Projects.

About Katanga Mining Limited
Katanga Mining Limited operates a major mine complex in the Democratic Republic of Congo producing refined copper and cobalt. The Company has the potential to become Africa's largest copper producer and the world's largest cobalt producer. Katanga is listed on the Toronto Stock Exchange under the symbol KAT.

Forward Looking Statements
This press release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. This press release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or describes a "goal", or variation of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.

All forward-looking statements reflect the Company's beliefs and assumptions based on information available at the time the statements were made. Actual results or events may differ from those predicted in these forward-looking statements. All of the Company's forward-looking statements are qualified by the assumptions that are stated or inherent in such forward-looking statements, including the assumptions listed below. Although the Company believes that these assumptions are reasonable, this list is not exhaustive of factors that may affect any of the forward-looking statements.

Forward-looking statements involve known and unknown risks, future events, conditions, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, prediction, projection, forecast, performance or achievements expressed or implied by the forward-looking statements. Although Katanga has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise, except in accordance with applicable securities laws.

SOURCE Katanga Mining Limited

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