Source: www.winnipegfreepress.com                        date: 18 May, 2011

Ivanhoe Mines reported a USD492.5 million net loss in the first quarter, primarily due to the revaluation of a derivative security as it worked on building the huge Oyu Tolgoi copper-gold-silver complex. The company, which owns two-thirds of Oyu Tolgoi, last week said that overall construction was about 15 per cent complete at the end of March — slightly ahead of schedule.

Exploration expenses were USD46.2 million, down from USD71.4 million in the first quarter of 2010. Only about USD13.5 million of the exploration expenses were in Mongolia, while USD30.4 million was incurred by Ivanhoe Australia. Revenue from coal sales by Ivanhoe's publicly traded subsidiary SouthGobi Resources was USD20.2 million. That was up from USD13.9 million in the first quarter of 2010, but down from USD41.6 million in the fourth quarter of 2010.

During the quarter, Ivanhoe generated USD1.18 billion from a rights offering to shareholders. At the end of the quarter, Ivanhoe had USD1.9 billion of cash and as of May 13 its cash position was USD1.6 billion.