Mar. 14 (Dow Jones) -- Ivanhoe Mines Ltd. (IVN) and BHP Billiton Ltd. (BHP) said they have found a new copper-molybdenum-gold zone just north of the massive Oyu Tolgoi mining project in Mongolia, one of the world's largest copper-gold developments.
Ivanhoe owns 66% of Oyu Tolgoi, which is under construction, while the Mongolian government owns 34%.
The new zone of shallow mineralization, Ulaan Khud North, is on an exploration licence that is part of an Ivanhoe joint venture with BHP formed in 2005. BHP has earned a 50% interest in the joint venture, which includes the Ulaan Khud North property, by spending $8 million in exploration costs and conducting an airborne survey, Ivanhoe said.
Another global mining giant, Rio Tinto PLC (RIO), holds a big stake in Ivanhoe.
Ivanhoe Chief Executive Robert Friendland said the discovery extends the known strike length of the Oyu Tolgoi mineralized system by three kilometers to the north, to more than 23 kilometers, and strengthens Ivanhoe's belief "that with continued exploration there is excellent potential to discover new porphyry deposits, rich in copper and gold, which are associated with the world-class Oyu Tolgoi mineralized trend."
A pre-mining agreement for the Ulaan Khud North property provides Ivanhoe and BHP with a three-year window for further exploration and preparation of studies on the project.