Another eventful year for Ivanhoe Mines

The last year showed renewed signs of hope along with continuing frustrations for Ivanhoe Mines (IVN-T) which reported its year end results on Tuesday.

The highlight of the year came in the form of an investment agreement getting drafted for the development of the Oyu Tolgoi copper-gold mine.

But as the company has learned in its years of experience in Mongolia, nothing is so cut and dry.

While the draft was approved in principle by the Mongolian Cabinet in March, the agreement still needs Parliament review and approval. And that parliament has proved impressively fickle over the last many years.

It reconvenes in the first week of April, and Ivanhoe hopes, no doubt, that this time it will be a model of efficiency. There is nothing its recent history, however, that would support such a hope.

On the ground at Oyu Tolgoi, the already world class deposit continues to offer more. In December of last year the company discovered a new zone of high-grade gold and copper mineralization. The discovery was made between the previously discovered Heruga Deposit and the Southwest Oyu Deposit.

As currently defined the mineralized corridor that composes the project has a total strike length of over 20 km. That length includes recent extensions to the north onto the joint Ivanhoe and Entrée Gold (ETG-T) property.

The year also saw Ivanhoe generate cashflows via its 80%-owned subsidiary, SouthGobi Energy Resources (SGQ-V). The company began sales of high-quality thermal coal at its Ovoot Tolgoi mine in southern Mongolia in September.

And SouthGobi further solidified its reach beyond Mongolia with a resource report for its Mamahak metallurgical coal project in Indonesia. The company is looking at starting surface coal mining at there later this year.

Continuing with its growing reputation outside of Mongolia, the company was part of a molybdenum discovery in Australia through an 83%-owned subsidiary, Ivanhoe Australia (IVA-A). The discovery was made at its Merlin project on its Cloncurry tenements in northwestern Queensland. Drilling in ongoing at the deposit which is open along strike and to depth.

And that isn’t all. The company is increasing its presence in mineral rich — if political tumultuous — Kazakhstan through its interest in the Altynalmas gold project.

But such expansion didn’t come without some selling off of assets. Ivanhoe sold its shareholdings of Jinshan Gold Mines for $216.7 million in the second quarter of last year. That sale netted the company a $201.4 million gain on the sale of its interest in Jinshan.

And while its exploration and mine development budget fell 15%, it still came in at an impressive $260.3 million compared with the $304 million it spent in 2007.

In Toronto on March 31 Ivanhoe shares were up 4.4% or 33¢ to $7.78 on 2.2 million shares traded.