##### Table of Contents



IVANHOE MINES LTD.
 Annual Information Form




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##### 



TABLE OF CONTENTS
 INTERPRETATION INFORMATION
    
    
    1Forward-Looking Information
    
    
    1Currency and Exchange Rates
    
    
    2Definitions
    
    
    2Conversion Factors
    
    
    5Glossary of Technical Terms and Abbreviations
    
    
    5CORPORATE STRUCTURE
    
    
    9Name, Address and Incorporation
    
    
    9Intercorporate Relationships
    
    
    9GENERAL DEVELOPMENT OF THE BUSINESS
    
    
    10Overview
    
    
    10Three Year History
    
    
    10Rio Tinto Transactions
    
    
    13Agreements with the Government of Mongolia
    
    
    16Risk Factors
    
    
    21DESCRIPTION OF THE BUSINESS
    
    
    33Overview
    
    
    33Qualified Persons
    
    
    33Oyu Tolgoi Project
    
    
    33Ovoot Tolgoi Coal Project
    
    
    59Other Projects
    
    
    73Other Information
    
    
    75DIVIDENDS
    
    
    75DESCRIPTION OF CAPITAL STRUCTURE
    
    
    76Common Shares
    
    
    76Preferred Shares
    
    
    76MARKET FOR SECURITIES
    
    
    76DIRECTORS AND OFFICERS
    
    
    77Name and Occupation
    
    
    77Shareholdings of Directors and Executive Officers
    
    
    79Committees of the Board
    
    
    80Conflicts of Interest
    
    
    80Audit Committee Information
    
    
    80INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
    
    
    80TRANSFER AGENTS AND REGISTRARS
    
    
    82MATERIAL CONTRACTS
    
    
    82INTERESTS OF EXPERTS
    
    
    83ADDITIONAL INFORMATION
    
    
    83SCHEDULE A  AUDIT COMMITTEE INFORMATION
    
    
    i




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INTERPRETATION INFORMATION
 
 Forward-Looking Information




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Currency and Exchange Rates
 .
   Year Ended December 312009
    
    2008
    
    2007End of period
    
    
    1.0466
    
    
    
    1.2246
    
    
    
    0.9881High for the period
    
    
    1.3000
    
    
    
    1.2969
    
    
    
    1.1853Low for the period
    
    
    1.0292
    
    
    
    0.9719
    
    
    
    0.9170Average for the period
    
    
    1.1420
    
    
    
    1.0660
    
    
    
    1.0748
  
 Definitions
  AIF
 Altynalmas Gold
 AMEC Minproc
 Anti-Dilution Warrants
 Approved Investment Contract
 ASX
 Cloncurry Project
 Common Shares
 Contract Assignment Arrangement Agreement
 Credit Agreement
 Entrée
 Entrée Earn-in Agreement
 - 2 -




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Entrée Joint Venture
 Erdenes
 First Tranche Investment
 HKSE
 Hugo Dummett Deposits
 Hugo North
 Hugo North Extension
 Hugo South
 Integrated Development Plan 2005 IDP05
 Investment Agreement
 Ivanhoe Australia
 IVN Company
 IVN Group
 MEL
 Norwest
 OT LLC
 Ovoot Tolgoi
 Ovoot Tolgoi Coal Project
 Ovoot Tolgoi Technical Report .
 Oyu Tolgoi Project
 Oyu Tolgoi Technical Report
 Preferred Shares
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Private Placement Agreement
 Private Placement Warrants
 Put Agreement
 Put Option Placement Shares
 Rio Tinto
 Rio Tinto Alcan
 Rio Tinto Group
 Savage River Project
 Second Tranche Investment
 Series A Warrants
 Series B Warrants
 Series C Warrants
 Shareholders Agreement
 Southern Oyu Deposits
 SouthGobi SGQ
 Southgobi sands SGS
 Sunrise Field
 Sunset Field
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T-Bill Purchase Agreement
 Technical Committee
 TSX
 Underground
 Warrant Determination Date
 YBCA Business Corporations Act
 
 Conversion Factors
  Imperial Measure =
    
    Metric Unit
    
    Metric Unit =
    
    Imperial Measure2.47 acres
    
    1 hectare
    
    0.4047 hectares
    
    1 acre3.28 feet
    
    1 m
    
    0.3048 m
    
    1 foot0.62 miles
    
    1 km
    
    1.609 km
    
    1 mile0.032 ounces (troy)
    
    1 gram
    
    31.1 grams
    
    1 ounce (troy)2.205 pounds
    
    1 kilogram
    
    0.454 kilograms
    
    1 pound1.102 tons (short)
    
    1 tonne
    
    0.907 tonnes
    
    1 ton0.029 ounces (troy)/ton
    
    1 gram/tonne
    
    34.28 grams/tonne
    
    1 ounce (troy)/ton
 
 Glossary of Technical Terms and Abbreviations
  anomaly:
 assay:
 Au:
 chalcocite:
 chalcopyrite:
 CIM
 CIM Standards
 concentrate:
 - 5 -




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concentrator:
 covellite:
 Cu
 CuEq
 cut-off grade:
 dyke:
 fault:
 feasibility study:
 flotation:
 gangue:
 g/t
 GSC Paper 88  21
 hypogene:
 HQ:
 indicated mineral resource:
 inferred mineral resource:
 - 6 -




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intrusive:
 IP:
 km
 km 2
 kriging:
 lb
 leach:
 m
 mm
 measured mineral resource:
 metallurgic coal:
 mineral reserve:
 mineral resource (deposit):
 Mo
 NI 43-101
 NQ:
 oz
 porphyry:
 - 7 -




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ppm
 preliminary assessment
 preliminary feasibility study pre-feasibility study
 probable reserve:
 proven reserve:
 PQ:
 qualified person:
 QMD or quartz monzodiorite:
 RC:
 seam:
 splits:
 stock:
 strike:
 sulphides:
 supergene:
 thermal coal
 tpd
 tpy
 - 8 -




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CORPORATE STRUCTURE
 
 Name, Address and Incorporation
 Company Act
  
 Intercorporate Relationships
  Oyu Tolgoi Project Group One Subsidiaries
 Voting EquityName of Subsidiary
    
    Jurisdiction of Incorporation
    
    Ownership InterestIvanhoe Mines Delaware Holdings, LLC
    
    Delaware
    
    
    100
    %Ivanhoe Mines Aruba Holdings LLC
    
    Aruba
    
    
    100
    %Ivanhoe Oyu Tolgoi (BVI) Ltd.
    
    British Virgin Islands
    
    
    100
    %Oyu Tolgoi LLC
    
    Mongolia
    
    
    6.5
    %
 Oyu Tolgoi Project Group Two Subsidiaries
 Voting EquityName of Subsidiary
    
    Jurisdiction of Incorporation
    
    Ownership InterestIvanhoe OT Mines Ltd.
    
    British Columbia
    
    
    100
    %Turquoise Hill Netherlands Cooperative
    
    Netherlands
    
    
    100
    %(1)Oyu Tolgoi Netherlands B.V.
    
    Netherlands
    
    
    100
    %Oyu Tolgoi LLC
    
    Mongolia
    
    
    93.5
    %
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Ovoot Tolgoi Project Subsidiaries
 Voting EquityName of Subsidiary
    
    Jurisdiction of Incorporation
    
    Ownership InterestSouthGobi Energy Resources Ltd.
    
    British Columbia
    
    
    57.4
    %SGQ Coal Investment Pte. Ltd.
    
    Singapore
    
    
    100
    %Southgobi sands LLC
    
    Mongolia
    
    
    100
    %
 Cloncurry Project Subsidiaries
 Voting EquityName of Subsidiary
    
    Jurisdiction of Incorporation
    

Ownership InterestOrian Holding Corp.
    
    British Virgin Islands
    
    
    100
    %IAL Holdings Singapore Pte. Ltd.
    
    Singapore
    
    
    100
    %Ivanhoe Australia Limited
    
    Australia
    
    
    81
    %Ivanhoe Australia Tennant Creek Pty. Ltd.
    
    Australia
    
    
    100
    % (2)Ivanhoe Cloncurry Mines Pty. Limited
    
    Australia
    
    
    100
    %(2)
 
 (1)
    
    Ownership divided between IVN, as to 80%, and Ivanhoe OT Mines, as to 20%.(2)
    
    Each of these companies is a wholly-owned subsidiary of Ivanhoe Australia Limited.  
 GENERAL DEVELOPMENT OF THE BUSINESS
 
 Overview
  
 Three Year History
 2007
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2008
        2009
  - 11 -




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2010 to date
     - 12 -




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Rio Tinto Transactions
  Private Placement Agreement
       
    
    make a take-over bid or a tender offer for, or otherwise acquire any Common Shares or
securities convertible into Common Shares or engage in certain other specified activities
except as contemplated by the Private Placement Agreement;
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
    
    prior to having fully exercised all of the Series A Warrants and Series B Warrants,
directly or indirectly acquire, alone or jointly or in concert with any other person, any
Common Shares or securities convertible into Common Shares (other than Common Shares or
securities acquired through an issuance by the Company) representing more than 6.65% of the
then issued and outstanding Common Shares, provided that the Put Option Placement Shares
will be counted toward such 6.65% threshold; or
    
    after having fully exercised all of the Series A Warrants and Series B Warrants,
directly or indirectly acquire, alone or jointly or in concert with any other person, any
Common Shares or securities convertible into Common Shares that would result in the Rio
Tinto Group owning in excess of 46.65% of the then issued and outstanding Common Shares.
    Credit Agreement
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
    
    pledges of, and first ranking charges over, the shares of certain of its material
subsidiaries through which it beneficially owns, directly or indirectly, its interest in
the Oyu Tolgoi Project;
    
    a first ranking charge over a 2% net smelter returns royalty that the Company holds in
respect of the Oyu Tolgoi Project; and
    
    first ranking general security interest over all assets of the Company.
  Contract Assignment Arrangement Agreement and Put Agreement
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Rio Tinto Pro Forma Holdings
  AggregatePercentage of AllNumber of Common
    
    Common SharesTransaction
    
    Number of Common Shares Held
    
    Shares Issuable
    
    OutstandingFirst Tranche Investment
    
    
    37,333,655
    (1)
    
    
    N/A
    
    
    
    9.87
    %Second Tranche Investment
    
    
    46,304,473
    
    
    
    N/A
    
    
    
    19.70
    %Put Option Placement Shares
    
    
    15,000,000
    
    
    
    N/A
    
    
    
    22.36
    %Exercise of Series A Warrants
    
    
    N/A
    
    
    
    46,026,522
    
    
    
    29.70
    %Exercise of Series B Warrants
    
    
    N/A
    
    
    
    46,026,522
    
    
    
    35.77
    %Exercise of Series C Warrants
    
    
    N/A
    
    
    
    35,000,000
    
    
    
    39.72
    %Exercise of Anti-Dilution Warrants(2)
    
    
    N/A
    
    
    
    1,440,406
    
    
    
    39.88
    %Conversion of Credit Facility
    
    
    N/A
    
    
    
    45,800,000
    
    
    
    44.35
    %
 
 (1)
    
    Includes additional Common Shares issued pursuant to Rio Tintos exercise of its
pre-emptive rights under the Private Placement Agreement.(2)
    
    Represents additional share purchase warrants issued pursuant to Rio Tintos exercise
of its pre-emptive rights under the Private Placement Agreement. 
 Agreements with the Government of Mongolia
 Investment Agreement
  Effective Date
  Term
  - 16 -




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
    
    OT LLC must have demonstrated that the Oyu Tolgoi Project has been operated to industry
best practice in terms of national and community benefits, environment and health and
safety practices;
    
    OT LLC must have made capital expenditures in respect of the Oyu Tolgoi Project of at
least US$9 billion;
    
    OT LLC must have complied in all material respects with its obligations to pay taxes
under the laws of Mongolia, as stabilized under the terms of the Investment Agreement;
    
    OT LLC must have commenced commercial production from the Oyu Tolgoi Project within: (i)
seven years of the Effective Date, or (ii) five years from the date of having obtained
access to project financing sufficient to fully construct the Oyu Tolgoi Project in
accordance with the feasibility study submitted to the Government of Mongolia, whichever is
earlier;
    
    if, as part of the development of the Oyu Tolgoi Project, OT LLC has constructed, or is
constructing, a copper smelter, OT LLC must have constructed or be constructing such
smelter in Mongolia;
    
    if the development and operation of the Oyu Tolgoi Project has caused any unanticipated
and irreversible ecological damage to natural resources in Mongolia, OT LLC must have paid
compensation based on the value of any such permanently damaged natural resources in
accordance with the applicable laws of Mongolia; and
    
    OT LLC must have, within four years of having commenced commercial production at the Oyu
Tolgoi Project, secured the total power requirements for the Oyu Tolgoi Project from
sources within the territory of Mongolia.
 Investment Protection
  Taxes, Royalties and Fees
   - 17 -




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Project Financing and Commercial Production
   Infrastructure
    Smelter
  Power Supply
  - 18 -




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Local Communities
   Other
   Shareholders Agreement
  Ownership of OT LLC
  Management of Oyu Tolgoi Project
  - 19 -




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Election of Directors
  Existing Shareholder Loans and Cash Calls
   st
   Payment of Dividends
  Transfer of Shares of OT LLC to Third Parties
 - 20 -




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T-Bill Purchase Agreement
     
 Risk Factors
  Although the conditions to the effectiveness of the Investment Agreement have been fulfilled,
IVN now has obligations to the Government of Mongolia that must be performed within a relatively
short period of time.
  IVN may be limited in its ability to enforce the Investment Agreement against a sovereign
government.
  - 21 -




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The Investment Agreement includes a number of future covenants that may be outside of the
control of IVN to complete.





    
    IVN is obligated to obtain project financing for the development of the Oyu Tolgoi
Project within two years following the Effective Date of the Investment Agreement and to
commence commercial production within five years of securing such financing. There is a
risk that OT LLC will be unable to obtain sufficient project financing within the
stipulated time or that, in order to meet the project financing requirement in a timely
manner, OT LLC is required to accept financing terms that are less advantageous than those
that might have been available had there been no deadline for obtaining such financing.
There is also a risk that unanticipated construction delays or other unforeseen development
problems may cause delays in commencement in commercial production or that unforeseen
mining or processing difficulties are encountered that prevent OT LLC from attaining the
required commercial production levels;
    
    IVN is obligated to utilize only Mongolian power sources within 4 years of commencing
commercial production. Such sources of power may not be available or may be available upon
commercial terms that are less advantageous than those available from other potential power
suppliers;
    
    Mongolian nationals must represent at least 90% of the Oyu Tolgoi Project work force
once commercial production is attained and 50% of the Projects engineers must be Mongolian
nationals within five years, increasing to 70% after 10 years. While IVN has a plan for
achieving these targets, success in doing so is contingent upon the availability of a
sufficient number of qualified personnel, which is not wholly within IVNs control.
    
    IVN is obligated to use Mongolian services, transportation and freight facilities on a
priority basis. Such services and facilities may not be available to the extent required
or may be available upon commercial terms that are less advantageous than those available
from other sources.
    
    OT LLC has community development commitments and social responsibility obligations.
There is a risk that OT LLC will be unable to meet the expectations or demands of relevant
community stakeholders to the extent contemplated to allow OT LLC to meet its commitments
under the Investment Agreement.
    
    The extension of the term of the Investment Agreement from 30 years to 50 years is
subject to a number of conditions, including IVN having demonstrated that the Oyu Tolgoi
Project has been operated in accordance with industry best practices in terms of national
and community benefits, environment and health and safety practices. The inherently
subjective nature of these criteria creates


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the risk that IVN and the Government of Mongolia may disagree as to whether the conditions
for extending the term of the Investment Agreement have been met.
  The Oyu Tolgoi Project will be operated as a corporate/government joint venture and will be
subject to joint venture risk.
  The Government of Mongolia T-Bills may remain illiquid beyond the stated maturity date.
  There can be no assurance that IVN will be capable of raising the additional funding that it
needs to carry out its development and exploration objectives.
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Lack of infrastructure in proximity to IVNs material properties could adversely affect mining
feasibility.
  The resource and reserve estimates for the IVN Groups projects disclosed in this AIF are
estimates only and are subject to change based on a variety of factors, some of which are beyond
the IVN Groups control. The IVN Groups actual production, revenues and capital expenditures
may differ materially from these estimates.
    - 24 -




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Mining projects are sensitive to the volatility of metal prices.
    Copper
    
    GoldYear
    
    High
    
    Low
    
    Average
    
    High
    
    Low
    
    Average2005
    
    $
    2.11
    
    
    $
    1.39
    
    
    $
    1.67
    
    
    $
    536
    
    
    $
    411
    
    
    $
    4442006
    
    $
    3.99
    
    
    $
    2.06
    
    
    $
    3.05
    
    
    $
    725
    
    
    $
    524
    
    
    $
    6042007
    
    $
    3.77
    
    
    $
    2.37
    
    
    $
    3.23
    
    
    $
    841
    
    
    $
    604
    
    
    $
    6952008
    
    $
    4.08
    
    
    $
    1.26
    
    
    $
    3.15
    
    
    $
    1,011
    
    
    $
    713
    
    
    $
    8722009
    
    $
    3.33
    
    
    $
    1.38
    
    
    $
    2.34
    
    
    $
    1,213
    
    
    $
    810
    
    
    $
    972
 IVNs ability to carry on business in Mongolia is subject to legal and political risk.
     - 25 -




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Recent and future amendments to Mongolian laws could adversely affect IVNs mining rights in the
Oyu Tolgoi Project or make it more difficult or expensive to develop the project and carry out
mining.
  Changes in, or more aggressive enforcement of, laws and regulations could adversely impact IVNs
business.
  - 26 -




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IVN is subject to substantial environmental and other regulatory requirements and such
regulations are becoming more stringent. Non-compliance with such regulations, either through
current or future operations or a pre-existing condition could materially adversely affect IVN.
     Previous mining operations may have caused environmental damage at current and former IVN mining
projects, and if IVN cannot prove that such damage was caused by such prior operators, its
indemnities and exemptions from liability may not be effective.
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The actual cost of developing the Oyu Tolgoi Project may differ significantly from IVNs
estimates and involve unexpected problems or delays.
  
    
    anticipated tonnage, grades and metallurgical characteristics of ore to be mined and
processed;
    
    anticipated recovery rates of copper and gold from the ore;
    
    cash operating costs of comparable facilities and equipment; and
    
    anticipated climatic conditions.
  
    
    the timing and cost, which can be considerable, of the construction of mining and
processing facilities;
    
    the availability and cost of skilled labour, power, water and transportation;
    
    the availability and cost of appropriate smelting and refining arrangements;
    
    the need to obtain necessary environmental and other government permits, and the timing
of those permits; and
    
    the availability of funds to finance construction and development activities.
  IVNs ability to obtain dividends or other distributions from its subsidiaries may be subject to
restrictions imposed by law, foreign currency exchange regulations and fi n ancing arrangements.
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There can be no assurance that the interest held by IVN in its exploration, development and
mining properties is free from defects or that material contractual arrangements between IVN and
entities owned or controlled by foreign governments will not be unilaterally altered or revoked.
  The proceeds from the sale of the Savage River Project are dependent on iron ore prices and the
remaining supply of ore at the Savage River Project.
  Competition for new mining properties by larger, more established companies may prevent IVN from
acquiring interests in additional properties or mining operations.
  There is no assurance that IVN will be capable of consistently producing positive cash flows.
  There is no guarantee that any exploration activity will result in commercial production of
mineral deposits.
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IVN cannot insure against all of the risks associated with mining.
  
    
    rock bursts, slides, fires, earthquakes or other adverse environmental occurrences;
    
    industrial accidents;
    
    labour disputes;
    
    political and social instability;
    
    technical difficulties due to unusual or unexpected geological formations;
    
    failures of pit walls, shafts, headframes, underground workings; and
    
    flooding and periodic interruptions due to inclement or hazardous weather condition.
  
    
    damage to, and destruction of, mineral properties or production facilities;
    
    personal injury;
    
    environmental damage;
    
    delays in mining;
    
    monetary losses; and
    
    legal liability.
  Insofar as Rio Tinto is the Companys largest shareholder, Rio Tinto has the ability to
significantly influence the business and affairs of IVN.
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IVN is exposed to risks of changing political stability and government regulation in the
countries in which it operates.
   IVNs prospects depend on its ability to attract and retain key personnel.
  Certain directors of IVN are directors or officers of, or have significant shareholdings, in
other mineral resource companies and there is the potential that such directors will encounter
conflicts of interest with IVN.
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Capital markets are volatile.
   IVN is subject to the U.S. Foreign Corrupt Practices Act.
  - 32 -




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IVN and SouthGobi hold substantial funds in cash and cash equivalents and there is a risk that
financial market turmoil or other extraordinary events could prevent the companies from
obtaining timely access to such funds or result in the loss of such funds.
  
 DESCRIPTION OF THE BUSINESS
 
 Overview
  
 Qualified Persons
   .
 
 Oyu Tolgoi Project
  - 33 -




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Project Description and Location
       - 34 -




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Environment
          - 35 -




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Accessibility, Climate, Local Resources and Physiography
       - 36 -




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History
      - 37 -




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Geology and Mineralization
      - 38 -




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Heruga Deposit
    Southern Oyu Deposits
   - 39 -




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Hugo Dummett Deposits
   - 40 -




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Exploration
  - 41 -




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- 42 -




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Drilling
      Sampling, Analyses and Security
    - 43 -




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Mineral Resources and Mineral Reserves
  - 44 -




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Mineral Resources
       Resources
  Total Oyu Tolgoi Project Mineral Resources March 2010 (1)(2)  (based on a 0.60 CuEq cut-off)
 Contained Metal(4)Resource
    
    
    
    
    
    Cu
    
    Au
    
    Mo
    
    CuEq(3)
    
    Cu
    
    Au
    
    CuEq(3)Category
    
    Tonnes
    
    (%)
    
    (g/t)
    
    (ppm)
    
    (%)
    

(000 lbs)
    
    (oz)
    

(000 lbs)Measured
    
    
    101,590,000
    
    
    
    0.64
    
    
    
    1.10
    
    
    
    
    
    
    
    1.34
    
    
    
    1,430,000
    
    
    
    3,590,000
    
    
    
    3,000,000Indicated
    
    
    1,285,840,000
    
    
    
    1.38
    
    
    
    0.42
    
    
    
    
    
    
    
    1.65
    
    
    
    39,120,000
    
    
    
    17,360,000
    
    
    
    46,770,000Measured + Indicated
    
    
    1,387,430,000
    
    
    
    1.33
    
    
    
    0.47
    
    
    
    
    
    
    
    1.63
    
    
    
    40,680,000
    
    
    
    20,970,000
    
    
    
    49,860,000Inferred
    
    
    2,367,130,000
    
    
    
    0.78
    
    
    
    0.33
    
    
    
    50
    
    
    
    1.02
    
    
    
    40,610,000
    
    
    
    25,390,000
    
    
    
    53,280,000
 
  (1)
    
    Resource classifications conform to CIM Standards on Mineral Resources and Reserves
referred to in National Instrument 43-101. Mineral Resources that are not Reserves do not
have demonstrated economic viability. Measured and Indicated
Resources are that part of a mineral
resource for which quantity and grade can be estimated with a level of confidence
sufficient to allow the application of technical and
economic parameters to support mine planning and evaluation of the economic viability
of the project. An Inferred Resource is that part of a - 45 -




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mineral resource for which quantity and grade can be estimated on the basis of geological evidence and limited sampling and
reasonably assumed, but not verified, geological and grade continuity.(2)
    
    This table includes estimated resources on the Hugo North Extension Deposit and the
Heruga deposit. These deposits are located on mineral licences owned by Entrée but subject
to the Entrée Joint Venture. These resources consist of indicated resources of 117,000,000
tonnes grading 1.8% copper and 0.61 g/t gold and inferred resources of 910,000,000 tonnes
grading 0.48% copper and 0.49 g/t gold and a 141ppm Molybdenum at a 0.6% cut-off grade on
the combined Hugo North Extension and Heruga Deposits.(3)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(4)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper. Differences in
measured and indicated totals relate to rounding associated with tonnes and grade. ®
   Southern Oyu Resources
  Southern Oyu Deposits (1)(2)
 Contained Metals(4)Southern Oyu
    
    CuEq
    
    Tonnage
    
    Cu
    
    Au
    
    CuEq
    
    Cu
    
    Au
    
    CuEq(3)Deposits
    
    Cutoff
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)(3)
    

(000 lb)
    
    (oz)
    

(000 lb)Measured
    
    
    1.0
    
    
    
    59,550,000
    
    
    
    0.77
    
    
    
    1.55
    
    
    
    1.76
    
    
    
    1,011,000
    
    
    
    2,970,000
    
    
    
    2,311,0000.7
    
    
    
    84,140,000
    
    
    
    0.69
    
    
    
    1.25
    
    
    
    1.49
    
    
    
    1,280,000
    
    
    
    3,380,000
    
    
    
    2,764,0000.6
    
    
    
    101,590,000
    
    
    
    0.65
    
    
    
    1.09
    
    
    
    1.34
    
    
    
    1,456,000
    
    
    
    3,560,000
    
    
    
    3,001,0000.5
    
    
    
    115,180,000
    
    
    
    0.61
    
    
    
    1.00
    
    
    
    1.25
    
    
    
    1,549,000
    
    
    
    3,700,000
    
    
    
    3,174,0000.4
    
    
    
    123,440,000
    
    
    
    0.59
    
    
    
    0.95
    
    
    
    1.20
    
    
    
    1,606,000
    
    
    
    3,770,000
    
    
    
    3,266,0000.3
    
    
    
    126,690,000
    
    
    
    0.58
    
    
    
    0.93
    
    
    
    1.17
    
    
    
    1,620,000
    
    
    
    3,790,000
    
    
    
    3,268,0000.25
    
    
    
    127,550,000
    
    
    
    0.58
    
    
    
    0.92
    
    
    
    1.17
    
    
    
    1,631,000
    
    
    
    3,770,000
    
    
    
    3,290,0000.2
    
    
    
    127,800,000
    
    
    
    0.58
    
    
    
    0.92
    
    
    
    1.17
    
    
    
    1,634,000
    
    
    
    3,780,000
    
    
    
    3,296,000Indicated
    
    
    1.0
    
    
    
    102,330,000
    
    
    
    0.85
    
    
    
    0.82
    
    
    
    1.38
    
    
    
    1,918,000
    
    
    
    2,700,000
    
    
    
    3,113,000
 - 46 -




---



##### Table of Contents



Contained Metals(4)Southern Oyu
    
    CuEq
    
    Tonnage
    
    Cu
    
    Au
    
    CuEq
    
    Cu
    
    Au
    
    CuEq(3)Deposits
    
    Cutoff
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)(3)
    

(000 lb)
    
    (oz)
    

(000 lb)0.7
    
    
    
    279,850,000
    
    
    
    0.71
    
    
    
    0.50
    
    
    
    1.02
    
    
    
    4,380,000
    
    
    
    4,500,000
    
    
    
    6,293,0000.6
    
    
    
    430,830,000
    
    
    
    0.63
    
    
    
    0.40
    
    
    
    0.89
    
    
    
    5,984,000
    
    
    
    5,540,000
    
    
    
    8,453,0000.5
    
    
    
    617,530,000
    
    
    
    0.57
    
    
    
    0.35
    
    
    
    0.79
    
    
    
    7,760,000
    
    
    
    6,950,000
    
    
    
    10,755,0000.4
    
    
    
    827,050,000
    
    
    
    0.51
    
    
    
    0.30
    
    
    
    0.70
    
    
    
    9,299,000
    
    
    
    7,980,000
    
    
    
    12,763,0000.3
    
    
    
    992,400,000
    
    
    
    0.47
    
    
    
    0.27
    
    
    
    0.64
    
    
    
    10,283,000
    
    
    
    8,610,000
    
    
    
    14,002,0000.25
    
    
    
    1,067,830,000
    
    
    
    0.45
    
    
    
    0.26
    
    
    
    0.61
    
    
    
    10,594,000
    
    
    
    8,930,000
    
    
    
    14,360,0000.2
    
    
    
    1,143,710,000
    
    
    
    0.43
    
    
    
    0.25
    
    
    
    0.59
    
    
    
    10,842,000
    
    
    
    9,190,000
    
    
    
    14,877,000Measured+Indicated
    
    
    1.0
    
    
    
    161,880,000
    
    
    
    0.82
    
    
    
    1.09
    
    
    
    1.52
    
    
    
    2,926,000
    
    
    
    5,670,000
    
    
    
    5,425,0000.7
    
    
    
    363,990,000
    
    
    
    0.70
    
    
    
    0.67
    
    
    
    1.13
    
    
    
    5,617,000
    
    
    
    7,840,000
    
    
    
    9,068,0000.6
    
    
    
    532,420,000
    
    
    
    0.64
    
    
    
    0.54
    
    
    
    0.98
    
    
    
    7,512,000
    
    
    
    9,240,000
    
    
    
    11,503,0000.5
    
    
    
    732,710,000
    
    
    
    0.57
    
    
    
    0.45
    
    
    
    0.86
    
    
    
    9,207,000
    
    
    
    10,600,000
    
    
    
    13,892,0000.4
    
    
    
    950,490,000
    
    
    
    0.52
    
    
    
    0.38
    
    
    
    0.76
    
    
    
    10,896,000
    
    
    
    11,610,000
    
    
    
    15,926,0000.3
    
    
    
    1,119,100,000
    
    
    
    0.48
    
    
    
    0.35
    
    
    
    0.70
    
    
    
    11,843,000
    
    
    
    12,590,000
    
    
    
    17,270,0000.25
    
    
    
    1,195,370,000
    
    
    
    0.46
    
    
    
    0.33
    
    
    
    0.67
    
    
    
    12,123,000
    
    
    
    12,680,000
    
    
    
    17,657,0000.2
    
    
    
    1,271,510,000
    
    
    
    0.45
    
    
    
    0.32
    
    
    
    0.65
    
    
    
    12,614,000
    
    
    
    13,080,000
    
    
    
    18,221,000Inferred
    
    
    1.0
    
    
    
    3,750,000
    
    
    
    0.91
    
    
    
    0.48
    
    
    
    1.22
    
    
    
    75,000
    
    
    
    60,000
    
    
    
    101,0000.7
    
    
    
    19,420,000
    
    
    
    0.62
    
    
    
    0.39
    
    
    
    0.87
    
    
    
    265,000
    
    
    
    240,000
    
    
    
    372,0000.6
    
    
    
    47,390,000
    
    
    
    0.51
    
    
    
    0.35
    
    
    
    0.74
    
    
    
    533,000
    
    
    
    530,000
    
    
    
    773,0000.5
    
    
    
    103,190,000
    
    
    
    0.43
    
    
    
    0.31
    
    
    
    0.63
    
    
    
    978,000
    
    
    
    1,030,000
    
    
    
    1,433,0000.4
    
    
    
    181,700,000
    
    
    
    0.38
    
    
    
    0.26
    
    
    
    0.55
    
    
    
    1,522,000
    
    
    
    1,520,000
    
    
    
    2,203,0000.3
    
    
    
    266,820,000
    
    
    
    0.34
    
    
    
    0.23
    
    
    
    0.48
    
    
    
    2,000,000
    
    
    
    1,970,000
    
    
    
    2,824,0000.25
    
    
    
    318,380,000
    
    
    
    0.32
    
    
    
    0.21
    
    
    
    0.45
    
    
    
    2,246,000
    
    
    
    2,150,000
    
    
    
    3,159,0000.2
    
    
    
    394,850,000
    
    
    
    0.29
    
    
    
    0.19
    
    
    
    0.40
    
    
    
    2,524,000
    
    
    
    2,410,000
    
    
    
    3,482,000
 
  (1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study. Mineral resources are
reported inclusive of mineral reserves.(2)
    
    The resources shown above at a 0.3% CuEq Cut-off are inclusive of the resources
tabulated at the 0.6 CuEq cutoff in the consolidated resource statement.(3)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(4)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper.   - 47 -




---



##### Table of Contents



Hugo Dummett Mineral Resources
     Hugo Dummett Deposits  Mineral Resources at 0.6% copper equivalent cut-off (1)
 Contained Metal(3)Tonnage
    
    Cu
    
    Au
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEq(2)Deposit
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)
    

(000 lb)
    
    (oz)
    

(000 lb)Indicated (Hugo North)
    
    
    703,200,000
    
    
    
    1.82
    
    
    
    0.39
    
    
    
    2.07
    
    
    
    28,215,000
    
    
    
    8,820,000
    
    
    
    32,091,000Indicated (Hugo
North
Extension)(4)
    
    
    117,000,000
    
    
    
    1.80
    
    
    
    0.61
    
    
    
    2.19
    
    
    
    4,643,000
    
    
    
    2,290,000
    
    
    
    5,649,000Inferred (Hugo North)
    
    
    722,800,000
    
    
    
    0.97
    
    
    
    0.30
    
    
    
    1.17
    
    
    
    15,457,000
    
    
    
    6,970,000
    
    
    
    18,644,000Inferred (Hugo North
Extension)(4)
    
    
    95,500,000
    
    
    
    1.15
    
    
    
    0.31
    
    
    
    1.35
    
    
    
    2,421,000
    
    
    
    950,000
    
    
    
    2,842,000Inferred (Hugo South)
    
    
    490,330,000
    
    
    
    1.05
    
    
    
    0.09
    
    
    
    1.11
    
    
    
    11,350,000
    
    
    
    1,420,000
    
    
    
    12,000,000TotalIndicated (Hugo
North and Hugo North
Extension(4))
    
    
    820,200,000
    
    
    
    1.82
    
    
    
    0.42
    
    
    
    2.08
    
    
    
    32,910,000
    
    
    
    11,080,000
    
    
    
    37,611,000
 - 48 -




---



##### Table of Contents



Contained Metal(3)Tonnage
    
    Cu
    
    Au
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEq(2)Deposit
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)
    

(000 lb)
    
    (oz)
    

(000 lb)Inferred (Hugo
North, Hugo South and
Hugo North
Extension(4))
    
    
    1,308,630,000
    
    
    
    1.02
    
    
    
    0.22
    
    
    
    1.16
    
    
    
    29,430,000
    
    
    
    9,260,000
    
    
    
    33,470,000
 
  (1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study. IVN reports mineral
resources inclusive of mineral reserves.(2)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(3)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper.(4)
    
    The Hugo North Extension is located on property which is the subject of the Entrée
Joint Venture.  Hugo North Mineral Resource Inventory (1)  Indicated
 Contained Metal(3)Class
    
    
    
    
    
    Tonnage
    
    Cu
    
    Au
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEq(2)Hugo North Deposit
    
    CuEq Cutoff
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)
    

(000 lb)
    
    (oz)
    

(000 lb)Indicated (Hugo North)
    
    
    3.5
    
    
    
    125,300,000
    
    
    
    3.74
    
    
    
    0.93
    
    
    
    4.34
    
    
    
    10,331,000
    
    
    
    3,750,000
    
    
    
    11,989,0003
    
    
    
    175,400,000
    
    
    
    3.49
    
    
    
    0.84
    
    
    
    4.03
    
    
    
    13,496,000
    
    
    
    4,740,000
    
    
    
    15,584,0002
    
    
    
    276,900,000
    
    
    
    3.03
    
    
    
    0.69
    
    
    
    3.47
    
    
    
    18,497,000
    
    
    
    6,140,000
    
    
    
    21,183,0001
    
    
    
    541,600,000
    
    
    
    2.15
    
    
    
    0.46
    
    
    
    2.44
    
    
    
    25,672,000
    
    
    
    8,010,000
    
    
    
    29,134,0000.6
    
    
    
    703,200,000
    
    
    
    1.82
    
    
    
    0.39
    
    
    
    2.07
    
    
    
    28,215,000
    
    
    
    8,820,000
    
    
    
    32,091,0000.3
    
    
    
    798,200,000
    
    
    
    1.65
    
    
    
    0.35
    
    
    
    1.87
    
    
    
    29,036,000
    
    
    
    8,980,000
    
    
    
    32,907,000Indicated (Hugo North
    
    
    3.5
    
    
    
    22,300,000
    
    
    
    3.68
    
    
    
    1.43
    
    
    
    4.59
    
    
    
    1,809,000
    
    
    
    1,030,000
    
    
    
    2,257,000Extension)(4)
    
    
    3
    
    
    
    32,000,000
    
    
    
    3.36
    
    
    
    1.29
    
    
    
    4.18
    
    
    
    2,370,000
    
    
    
    1,330,000
    
    
    
    2,949,0002
    
    
    
    52,300,000
    
    
    
    2.84
    
    
    
    1.09
    
    
    
    3.53
    
    
    
    3,275,000
    
    
    
    1,830,000
    
    
    
    4,070,0001
    
    
    
    84,800,000
    
    
    
    2.22
    
    
    
    0.80
    
    
    
    2.73
    
    
    
    4,150,000
    
    
    
    2,180,000
    
    
    
    5,104,0000.6
    
    
    
    117,000,000
    
    
    
    1.80
    
    
    
    0.61
    
    
    
    2.19
    
    
    
    4,643,000
    
    
    
    2,290,000
    
    
    
    5,649,0000.3
    
    
    
    137,900,000
    
    
    
    1.59
    
    
    
    0.52
    
    
    
    1.92
    
    
    
    4,834,000
    
    
    
    2,310,000
    
    
    
    5,837,000Total Indicated
    
    
    3.5
    
    
    
    147,600,000
    
    
    
    3.73
    
    
    
    1.01
    
    
    
    4.38
    
    
    
    12,138,000
    
    
    
    4,790,000
    
    
    
    14,253,000(Hugo North and Hugo
    
    
    3
    
    
    
    207,400,000
    
    
    
    3.47
    
    
    
    0.91
    
    
    
    4.05
    
    
    
    15,866,000
    
    
    
    6,070,000
    
    
    
    18,518,000North Extension(4))
    
    
    2
    
    
    
    329,200,000
    
    
    
    3.00
    
    
    
    0.76
    
    
    
    3.48
    
    
    
    21,773,000
    
    
    
    8,040,000
    
    
    
    25,257,0001
    
    
    
    626,400,000
    
    
    
    2.16
    
    
    
    0.51
    
    
    
    2.48
    
    
    
    29,829,000
    
    
    
    10,270,000
    
    
    
    34,248,0000.6
    
    
    
    820,200,000
    
    
    
    1.82
    
    
    
    0.42
    
    
    
    2.08
    
    
    
    32,910,000
    
    
    
    11,080,000
    
    
    
    37,611,0000.3
    
    
    
    936,200,000
    
    
    
    1.64
    
    
    
    0.38
    
    
    
    1.88
    
    
    
    33,849,000
    
    
    
    11,440,000
    
    
    
    38,803,000
 - 49 -




---



##### Table of Contents



Inferred
 Contained Metal(3)Class
    
    
    
    
    
    Tonnage
    
    Cu
    
    Au
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEq(2)Hugo North Deposit
    
    CuEq Cutoff
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)
    
    (000 lb)
    
    (oz)
    
    (000 lb)Inferred
(Hugo North)
    
    
    >= 3.5
    
    
    
    3,600,000
    
    
    
    3.06
    
    
    
    1.41
    
    
    
    3.96
    
    
    
    243,000
    
    
    
    160,000
    
    
    
    314,000>= 3
    
    
    
    12,900,000
    
    
    
    2.80
    
    
    
    0.98
    
    
    
    3.43
    
    
    
    796,000
    
    
    
    410,000
    
    
    
    975,000>= 2
    
    
    
    54,700,000
    
    
    
    2.08
    
    
    
    0.91
    
    
    
    2.66
    
    
    
    2,508,000
    
    
    
    1,600,000
    
    
    
    3,208,000>= 1
    
    
    
    385,500,000
    
    
    
    1.25
    
    
    
    0.41
    
    
    
    1.51
    
    
    
    10,624,000
    
    
    
    5,080,000
    
    
    
    12,833,000>= 0.6
    
    
    
    722,800,000
    
    
    
    0.97
    
    
    
    0.30
    
    
    
    1.17
    
    
    
    15,457,000
    
    
    
    6,970,000
    
    
    
    18,644,000>= 0.3
    
    
    
    1,108,200,000
    
    
    
    0.76
    
    
    
    0.24
    
    
    
    0.92
    
    
    
    18,568,000
    
    
    
    8,550,000
    
    
    
    22,477,000Inferred (Hugo North
Extension)(4)
    
    
    >= 3.5
    
    
    
    1,400,000
    
    
    
    3.32
    
    
    
    1.03
    
    
    
    3.98
    
    
    
    102,000
    
    
    
    50,000
    
    
    
    123,000>= 3
    
    
    
    3,600,000
    
    
    
    2.97
    
    
    
    0.88
    
    
    
    3.53
    
    
    
    236,000
    
    
    
    100,000
    
    
    
    280,000>= 2
    
    
    
    11,000,000
    
    
    
    2.20
    
    
    
    0.86
    
    
    
    2.75
    
    
    
    534,000
    
    
    
    300,000
    
    
    
    667,000>= 1
    
    
    
    62,200,000
    
    
    
    1.39
    
    
    
    0.39
    
    
    
    1.64
    
    
    
    1,906,000
    
    
    
    780,000
    
    
    
    2,249,000>= 0.6
    
    
    
    95,500,000
    
    
    
    1.15
    
    
    
    0.31
    
    
    
    1.35
    
    
    
    2,421,000
    
    
    
    950,000
    
    
    
    2,842,000>= 0.3
    
    
    
    152,400,000
    
    
    
    0.85
    
    
    
    0.23
    
    
    
    1.00
    
    
    
    2,856,000
    
    
    
    1,130,000
    
    
    
    3,360,000Total
Inferred (Hugo North and
    
    
    >= 3.5
    
    
    
    5,000,000
    
    
    
    3.13
    
    
    
    1.30
    
    
    
    3.96
    
    
    
    345,000
    
    
    
    210,000
    
    
    
    437,000Hugo North Extension(4))
    
    
    >= 3
    
    
    
    16,500,000
    
    
    
    2.84
    
    
    
    0.96
    
    
    
    3.45
    
    
    
    1,033,000
    
    
    
    510,000
    
    
    
    1,255,000>= 2
    
    
    
    65,700,000
    
    
    
    2.10
    
    
    
    0.90
    
    
    
    2.68
    
    
    
    3,042,000
    
    
    
    1,900,000
    
    
    
    3,882,000>= 1
    
    
    
    447,700,000
    
    
    
    1.27
    
    
    
    0.41
    
    
    
    1.53
    
    
    
    12,535,000
    
    
    
    5,900,000
    
    
    
    15,101,000>= 0.6
    
    
    
    818,300,000
    
    
    
    1.00
    
    
    
    0.30
    
    
    
    1.19
    
    
    
    18,040,000
    
    
    
    7,890,000
    
    
    
    21,468,000>= 0.3
    
    
    
    1,260,500,000
    
    
    
    0.77
    
    
    
    0.24
    
    
    
    0.93
    
    
    
    21,398,000
    
    
    
    9,730,000
    
    
    
    25,844,000
 
  (1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study.(2)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper.(3)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(4)
    
    The Hugo North Extension is located on property which is the subject of the Entrée
Joint Venture.  Hugo South Mineral Resource Inventory (1)
 Contained Metal(3)CuEq
    
    Tonnage
    
    Cu
    
    Au
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEq(3)Hugo South Deposit
    
    Cutoff
    
    (t)
    
    (%)
    
    (g/t)
    
    (%)
    
    (000 lb)
    
    (oz)
    
    (000 lb)Inferred
    
    
    >= 3.5
    
    
    
    5,440,000
    
    
    
    3.71
    
    
    
    0.25
    
    
    
    3.87
    
    
    
    440,000
    
    
    
    40,000
    
    
    
    460,000>= 3
    
    
    
    11,950,000
    
    
    
    3.38
    
    
    
    0.21
    
    
    
    3.51
    
    
    
    890,000
    
    
    
    80,000
    
    
    
    920,000>= 2
    
    
    
    38,900,000
    
    
    
    2.67
    
    
    
    0.15
    
    
    
    2.77
    
    
    
    2,290,000
    
    
    
    190,000
    
    
    
    2,380,000>= 1
    
    
    
    203,590,000
    
    
    
    1.53
    
    
    
    0.09
    
    
    
    1.59
    
    
    
    6,870,000
    
    
    
    590,000
    
    
    
    7,140,000>= 0.6
    
    
    
    490,330,000
    
    
    
    1.05
    
    
    
    0.09
    
    
    
    1.11
    
    
    
    11,350,000
    
    
    
    1,420,000
    
    
    
    12,000,000>= 0.3
    
    
    
    1,105,600,000
    
    
    
    0.67
    
    
    
    0.07
    
    
    
    0.72
    
    
    
    16,330,000
    
    
    
    2,490,000
    
    
    
    17,550,000
 
  (1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study.(2)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(3)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper. Heruga Mineral Resources
   - 50 -




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##### Table of Contents



Heruga (OT License) Mineral Resource Inventory (1)  (October 2009)
 Contained Metal(3)Cut-off
    
    Tonnage
    
    Cu
    
    Au
    
    Mo
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEqCuEq %
    

(000 t)
    
    %
    
    g/t
    
    ppm
    
    %
    

(000 lb)
    

(000 oz)
    

(000 lb)>1.50
    
    
    
    
    
    
    0.58
    
    
    
    1.46
    
    
    
    52
    
    
    
    1.54
    
    
    
    
    
    
    
    
    
    
    
    >1.25
    
    
    
    
    
    
    0.53
    
    
    
    1.28
    
    
    
    52
    
    
    
    1.37
    
    
    
    10,000
    
    
    
    
    
    
    
    40,000>1.00
    
    
    10,000
    
    
    
    0.54
    
    
    
    0.86
    
    
    
    107
    
    
    
    1.15
    
    
    
    70,000
    
    
    
    
    
    
    
    140,000>0.90
    
    
    10,000
    
    
    
    0.54
    
    
    
    0.68
    
    
    
    131
    
    
    
    1.04
    
    
    
    130,000
    
    
    
    
    
    
    
    250,000>0.80
    
    
    20,000
    
    
    
    0.53
    
    
    
    0.55
    
    
    
    136
    
    
    
    0.95
    
    
    
    250,000
    
    
    
    
    
    
    
    450,000>0.70
    
    
    40,000
    
    
    
    0.50
    
    
    
    0.43
    
    
    
    133
    
    
    
    0.85
    
    
    
    460,000
    
    
    
    1,000
    
    
    
    780,000>0.60
    
    
    60,000
    
    
    
    0.48
    
    
    
    0.37
    
    
    
    128
    
    
    
    0.78
    
    
    
    670,000
    
    
    
    1,000
    
    
    
    1,090,000>0.50
    
    
    90,000
    
    
    
    0.45
    
    
    
    0.33
    
    
    
    122
    
    
    
    0.72
    
    
    
    840,000
    
    
    
    1,000
    
    
    
    1,360,000>0.40
    
    
    110,000
    
    
    
    0.41
    
    
    
    0.29
    
    
    
    111
    
    
    
    0.66
    
    
    
    1,020,000
    
    
    
    1,000
    
    
    
    1,640,000>0.30
    
    
    130,000
    
    
    
    0.38
    
    
    
    0.27
    
    
    
    105
    
    
    
    0.62
    
    
    
    1,110,000
    
    
    
    1,000
    
    
    
    1,770,000
 - 51 -




---



##### Table of Contents



Heruga (Entree Javkhlant Only) Mineral Resource Inventory (1)  (October 2009)
 Contained Metal(3)Cut-off
    
    Tonnage
    
    Cu
    
    Au
    
    Mo
    
    CuEq(2)
    
    Cu
    
    Au
    
    CuEqCuEq %
    

(000 t)
    
    %
    
    q/t
    
    ppm
    
    %
    
    (000 lb)
    
    (000 oz)
    
    (000 lb)>1.50
    
    
    30,000
    
    
    
    0.57
    
    
    
    1.86
    
    
    
    124
    
    
    
    1.83
    
    
    
    360,000
    
    
    
    2,000
    
    
    
    1,150,000>1.25
    
    
    70,000
    
    
    
    0.56
    
    
    
    1.45
    
    
    
    118
    
    
    
    1.55
    
    
    
    840,000
    
    
    
    3,000
    
    
    
    2,340,000>1.00
    
    
    190,000
    
    
    
    0.57
    
    
    
    0.96
    
    
    
    155
    
    
    
    1.26
    
    
    
    2,370,000
    
    
    
    6,000
    
    
    
    5,260,000>0.90
    
    
    290,000
    
    
    
    0.56
    
    
    
    0.80
    
    
    
    160
    
    
    
    1.15
    
    
    
    3,610,000
    
    
    
    8,000
    
    
    
    7,450,000>0.80
    
    
    450,000
    
    
    
    0.54
    
    
    
    0.66
    
    
    
    160
    
    
    
    1.05
    
    
    
    5,310,000
    
    
    
    10,000
    
    
    
    10,320,000>0.70
    
    
    660,000
    
    
    
    0.51
    
    
    
    0.56
    
    
    
    151
    
    
    
    0.95
    
    
    
    7,390,000
    
    
    
    12,000
    
    
    
    13,780,000>0.60
    
    
    910,000
    
    
    
    0.48
    
    
    
    0.49
    
    
    
    541
    
    
    
    0.87
    
    
    
    9,570,000
    
    
    
    14,000
    
    
    
    17,390,000>0.50
    
    
    1,210,000
    
    
    
    0.44
    
    
    
    0.44
    
    
    
    130
    
    
    
    0.79
    
    
    
    11,780,000
    
    
    
    17,000
    
    
    
    21,060,000>0.40
    
    
    1,670,000
    
    
    
    0.39
    
    
    
    0.38
    
    
    
    115
    
    
    
    0.69
    
    
    
    14,430,000
    
    
    
    20,000
    
    
    
    25,540,000>0.30
    
    
    2,180,000
    
    
    
    0.35
    
    
    
    0.33
    
    
    
    102
    
    
    
    0.61
    
    
    
    16,730,000
    
    
    
    23,000
    
    
    
    29,470,000
 Heruga (OT License and Javkhlant) Mineral Resource Inventory (1)  (October 2009)
 Contained Metal(3)Cut-off
    
    Tonnage
    
    Cu
    
    Au
    
    Mo
    
    CuEq(2)
    
    Cu
    
    
    
    
    
    CuEqCuEq %
    
    (t)
    
    %
    
    g/t
    
    ppm
    
    %
    
    (000 lb)
    
    Au (oz)
    
    (000 lb)>1.50
    
    
    30,000
    
    
    
    0.57
    
    
    
    1.86
    
    
    
    124
    
    
    
    1.83
    
    
    
    360,000
    
    
    
    2,000
    
    
    
    1,160,000>1.25
    
    
    70,000
    
    
    
    0.56
    
    
    
    1.45
    
    
    
    117
    
    
    
    1.55
    
    
    
    860,000
    
    
    
    3,000
    
    
    
    2,380,000>1.00
    
    
    190,000
    
    
    
    0.57
    
    
    
    0.96
    
    
    
    153
    
    
    
    1.26
    
    
    
    2,430,000
    
    
    
    6,000
    
    
    
    5,400,000>0.90
    
    
    300,000
    
    
    
    0.56
    
    
    
    0.79
    
    
    
    159
    
    
    
    1.15
    
    
    
    3,730,000
    
    
    
    8,000
    
    
    
    7,700,000>0.80
    
    
    470,000
    
    
    
    0.54
    
    
    
    0.66
    
    
    
    158
    
    
    
    1.04
    
    
    
    5,560,000
    
    
    
    10,000
    
    
    
    10,770,000>0.70
    
    
    700,000
    
    
    
    0.51
    
    
    
    0.56
    
    
    
    150
    
    
    
    0.94
    
    
    
    7,850,000
    
    
    
    13,000
    
    
    
    14,560,000>0.60
    
    
    970,000
    
    
    
    0.48
    
    
    
    0.48
    
    
    
    140
    
    
    
    0.86
    
    
    
    10,240,000
    
    
    
    15,000
    
    
    
    18,480,000>0.50
    
    
    1,300,000
    
    
    
    0.44
    
    
    
    0.43
    
    
    
    130
    
    
    
    0.78
    
    
    
    12,620,000
    
    
    
    18,000
    
    
    
    22,420,000>0.40
    
    
    1,780,000
    
    
    
    0.39
    
    
    
    0.37
    
    
    
    114
    
    
    
    0.69
    
    
    
    15,450,000
    
    
    
    21,000
    
    
    
    27,180,000>0.30
    
    
    2,310,000
    
    
    
    0.35
    
    
    
    0.33
    
    
    
    102
    
    
    
    0.61
    
    
    
    17,840,000
    
    
    
    24,000
    
    
    
    31,250,000
 
  (1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study. - 52 -




---



##### Table of Contents



(2)
    
    CuEq has been calculated using assumed metal prices ($1.35/lb. for copper and $650/oz
for gold and $10/lb for molybdenum); %CuEq. = Cu+((Au*18.98)+(Mo*0.01586))/29.76. Mo grades
outside of Heruga are assumed to be zero for CuEq calculations. The equivalence formula
was calculated assuming that gold and molybdenum recovery was 91% and copper recovery was
72%.(3)
    
    The contained gold and copper represent estimated contained metal in the ground and
have not been adjusted for the metallurgical recoveries of gold and copper. Mineral Reserves
   Southern Oyu Mineral Reserves  January 2006
 NSR
    
    Copper
    
    Gold
    
    CuEq Grade
    
    Recovered Copper
    
    RecoveredClass
    
    Ore (tonnes)
    
    $/t
    
    (%)
    
    (g/t )
    
    (%)
    
    (000 lbs)
    
    Gold (ounces)Proven
    
    
    127,000,000
    
    
    
    15.91
    
    
    
    0.58
    
    
    
    0.93
    
    
    
    1.18
    
    
    
    1,451,000
    
    
    
    2,833,000Probable
    
    
    803,000,000
    
    
    
    7.96
    
    
    
    0.48
    
    
    
    0.27
    
    
    
    0.66
    
    
    
    7,431,000
    
    
    
    4,768,000Total
    
    
    930,000,000
    
    
    
    9.05
    
    
    
    0.50
    
    
    
    0.36
    
    
    
    0.73
    
    
    
    8,882,000
    
    
    
    7,601,000
     - 53 -




---



##### Table of Contents



Project Development
    IDP05 Summary
     - 54 -




---



##### Table of Contents



- 55 -




---



##### Table of Contents



Engineering and Construction
  Health and Safety
  Underground Development
      - 56 -




---



##### Table of Contents



2010 Activities
   
    
    Resumption of the sinking of the 10-metre-diameter Shaft #2, which will be used to hoist
ore to the surface from the deep, underground, copper-gold-rich Hugo Dummett Deposit.
    
    Construction of a 97-metre-tall (approximately 31-storey), reinforced-concrete headframe
for Shaft #2.
    
    Pouring the concrete foundation for the 100,000-tonne-per-day concentrator and
deliveries of building materials for the concentrator and infrastructure.
    
    Installation of a 20-megawatt power station and 35-kilovolt distribution system.
    
    Initial earthworks for the open-pit mine at the Southern Oyu deposits.
    
    Continuation of lateral underground development off Shaft #1 at the Hugo Dummett
Deposit.
    
    Construction of a 105-kilometre highway link to the Mongolia-China border, which will be
fully paved by the time production begins.
    
    Construction of a regional airport, with a concrete runway to accommodate Boeing
737-sized aircraft.
 Current Exploration Activities
  Average Assay Intercepts, New Discovery Zone Drilling
 Hole
    
    From
    
    To
    
    Interval
    
    Au
    
    Cu
    
    Mo
    
    CuEqNumber
    
    (m)
    
    (m)
    
    (m)
    
    (g/t)
    
    (%)
    
    (ppm)
    
    (%)OTD1487
    
    
    1978
    
    
    
    1994
    
    
    
    16
    
    
    
    0.1
    
    
    
    1.65
    
    
    
    38
    
    
    
    1.732028
    
    
    
    2053.7
    
    
    
    25.7
    
    
    
    0.85
    
    
    
    0.89
    
    
    
    62
    
    
    
    1.47OTD1487A
    
    
    1978
    
    
    
    1994
    
    
    
    16
    
    
    
    0.09
    
    
    
    1.55
    
    
    
    38
    
    
    
    1.632028
    
    
    
    2126
    
    
    
    98
    
    
    
    0.96
    
    
    
    0.88
    
    
    
    115
    
    
    
    1.562258
    
    
    2336.3 (EOH)
    
    
    78.3
    
    
    
    2.13
    
    
    
    0.82
    
    
    
    126
    
    
    
    2.241978
    
    
    
    2336.3
    
    
    
    358.3
    
    
    
    0.85
    
    
    
    0.54
    
    
    
    66
    
    
    
    1.12
 - 57 -




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##### Table of Contents



Hole
    
    From
    
    To
    
    Interval
    
    Au
    
    Cu
    
    Mo
    
    CuEqNumber
    
    (m)
    
    (m)
    
    (m)
    
    (g/t)
    
    (%)
    
    (ppm)
    
    (%)OTD1495A
    
    
    2034
    
    
    
    2314
    
    
    
    280
    
    
    
    0.06
    
    
    
    0.84
    
    
    
    13
    
    
    
    0.882330
    
    
    2377.2 (EOH)
    
    
    47.2
    
    
    
    0.10
    
    
    
    1.32
    
    
    
    8
    
    
    
    1.392034
    
    
    2377.2 (EOH)
    
    
    343.2
    
    
    
    0.06
    
    
    
    0.87
    
    
    
    12
    
    
    
    0.91OTD1498A
    
    
    1978
    
    
    
    2100
    
    
    
    122
    
    
    
    0.05
    
    
    
    0.42
    
    
    
    54
    
    
    
    0.482240
    
    
    
    2318
    
    
    
    78
    
    
    
    0.07
    
    
    
    0.61
    
    
    
    12
    
    
    
    0.662346
    
    
    
    2418
    
    
    
    72
    
    
    
    0.07
    
    
    
    0.44
    
    
    
    41
    
    
    
    0.51OTD1500
    
    
    1800
    
    
    
    1910
    
    
    
    110
    
    
    
    0.17
    
    
    
    0.44
    
    
    
    189
    
    
    
    0.65OTD1500A
    
    
    
    
    
    in progressOTD1501
    
    
    
    
    
    in progress
      TM
   - 58 -




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##### Table of Contents



Ovoot Tolgoi Coal Project
  Property Description and Location
  2
  MONGOLIAN MINERAL EXPLORATION LICENSE FEES
 Year
    
    License Fee ($/Ha.)
    
    Minimum Expenditure ($/Ha.)1
    
    0.10
    
    0.002
    
    0.20
    
    0.503
    
    0.30
    
    0.504-6
    
    1.00
    
    1.007-9
    
    1.50
    
    1.50
   - 59 -




---



##### Table of Contents



Accessibility, Climate, Local Resources, Infrastructure and Physiography
 2
      History
  - 60 -




---



##### Table of Contents



Geological Setting
  Regional Geology
  Coal Occurrences
     Structural Geology
  - 61 -




---



##### Table of Contents



Exploration
     Drilling
   - 62 -




---



##### Table of Contents



HISTORIC COAL EXPLORATION DRILLING ACTIVITY
 Reverse Circulation
    
    Rotary
    
    Core
    
    Combination1Area
    
    Year
    
    No. Holes
    
    Meters Drilled
    
    No. Holes
    
    Meters Drilled
    
    No. Holes
    
    Meters Cored
    
    No. Holes
    
    Meters CoredSunrise Field
    
    2004 OT LLC
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    750
    
    
    
    
    
    
    
    2005 OT LLC
    
    
    76
    
    
    
    14,425
    
    
    
    18
    
    
    
    2,807
    
    
    
    34
    
    
    
    5,524
    
    
    
    
    
    
    
    2006 SGS
    
    
    11
    
    
    
    4,855
    
    
    
    12
    
    
    
    1,999
    
    
    
    5
    
    
    
    1,860
    
    
    
    7
    
    
    NA22007 SGQ
    
    
    
    
    
    
    
    
    
    
    17
    
    
    
    3,542
    
    
    
    1
    
    
    
    253.9
    
    
    
    
    
    
    
    2008 SGQ
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Sunset Field
    
    2005 OT LLC
    
    
    70
    
    
    
    12,861
    
    
    
    17
    
    
    
    2,223
    
    
    
    13
    
    
    
    2,034
    
    
    
    
    
    
    
    2006 SGS
    
    
    48
    
    
    
    10,203
    
    
    
    
    
    
    
    
    
    
    
    25
    
    
    
    5,737
    
    
    
    
    
    
    
    2007 SGQ
    
    
    
    
    
    
    
    
    
    
    23
    
    
    
    5,430.6
    
    
    
    7
    
    
    
    2,699.5
    
    
    
    
    
    
    
    2008 SGQ
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    41
    
    
    
    23,189.4
    
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    205
    
    
    
    42,344
    
    
    
    87
    
    
    
    16,001.6
    
    
    
    131
    
    
    
    42,047.8
    
    
    
    7
    
    
    NA2
 
 1
    
    Combination holes with RC and/or PCD rotary and/or core method.2
    
    Meters drilled recorded as RC, Rotary or Core meters.   Mineralization
  OVOOT TOLGOI PROPERTY COAL SEAM CHARACTERISTICS
 No
    
    Minimum Thickness*
    
    Maximum Thickness*Property
    
    Series
    
    Seams
    
    (m)
    
    (m)
    
    Mean Thickness* (m)Sunrise Field
    
    Upper Seams
    
    
    11
    
    
    
    0.6
    
    
    
    74
    
    
    
    105 Main
    
    
    1
    
    
    
    0.9
    
    
    
    157
    
    
    
    535 Lower
    
    
    1
    
    
    
    0.6
    
    
    
    100
    
    
    
    164 Main
    
    
    1
    
    
    
    1.0
    
    
    
    30
    
    
    
    8Sunset Field
    
    Upper Seams
    
    
    60
    
    
    
    0.6
    
    
    
    31
    
    
    
    75 Main & Lower
    
    
    2
    
    
    
    0.6
    
    
    
    142
    
    
    
    39
 
 *
    
    Apparent Seam Thickness - 63 -




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##### Table of Contents



Deposit Type
    Coal Quality
  SUMMARY OF IN PLACE RAW COAL QUALITY FOR SUNRISE RESOURCE AREA
 Moisture
    
    Ash
    
    Sulphur
    
    GCV
    
    
    
    
    
    VolatilesSeams
    
    (AD)%
    
    %
    
    %
    
    Kcal/kg
    
    FSI
    
    %4
    
    
    0.84
    
    
    
    21.79
    
    
    
    0.67
    
    
    
    6,246
    
    
    
    2.0
    
    
    
    27.185 Lower
    
    
    1.03
    
    
    
    15.22
    
    
    
    1.19
    
    
    
    6,749
    
    
    
    3.8
    
    
    
    31.265
    
    
    1.25
    
    
    
    14.15
    
    
    
    1.01
    
    
    
    6,804
    
    
    
    3.2
    
    
    
    31.53Upper Seams
    
    
    1.29
    
    
    
    19.13
    
    
    
    1.17
    
    
    
    6,271
    
    
    
    2.6
    
    
    
    30.79Surface Total
    
    
    1.24
    
    
    
    16.24
    
    
    
    1.07
    
    
    
    6,592
    
    
    
    3.0
    
    
    
    31.125 Seam Underground
    
    
    0.72
    
    
    
    13.10
    
    
    
    0.95
    
    
    
    6,976
    
    
    
    3.5
    
    
    
    31.84Grand Total
    
    
    1.14
    
    
    
    15.64
    
    
    
    1.05
    
    
    
    6,666
    
    
    
    3.1
    
    
    
    31.26
 SUMMARY OF IN PLACE RAW COAL QUALITY FOR SUNSET RESOURCE AREA
 Moisture
    
    Ash
    
    Sulphur
    
    GCV
    
    
    
    
    
    VolatilesSeams
    
    (AD)%
    
    %
    
    %
    
    Kcal/kg
    
    FSI
    
    %5 and 5 Lower
    
    
    1.20
    
    
    
    7.69
    
    
    
    0.62
    
    
    
    7,476
    
    
    
    4.4
    
    
    
    32.37Upper Seams
    
    
    1.20
    
    
    
    18.96
    
    
    
    1.16
    
    
    
    6,443
    
    
    
    3.6
    
    
    
    30.59Surface Total
    
    
    1.20
    
    
    
    16.45
    
    
    
    1.04
    
    
    
    6,673
    
    
    
    3.8
    
    
    
    30.995 and 5L Underground
    
    
    1.20
    
    
    
    8.28
    
    
    
    0.49
    
    
    
    7,509
    
    
    
    5.0
    
    
    
    32.28Grand Total
    
    
    1.20
    
    
    
    13.34
    
    
    
    0.83
    
    
    
    6,991
    
    
    
    4.2
    
    
    
    31.48
 Sample Preparation, Analysis and Security
  - 64 -




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##### Table of Contents



Core Drilling Samples
   - 65 -




---



##### Table of Contents



1
  RC Samples
   Data Verification
  
    
    Verification of drill hole position and elevation by visiting a significant percentage
of the sites and taking GPS measurements for comparison with the survey data and
topographic maps.
    
    Review of geophysical logs for validation with the geologic database
    
    Review of the coal quality analytical reports for validation with the geologic
database.
    
    Review of selected core logs and core photographs.
 Mineral Resource Estimate
   
 1
    
    SGS North America Inc. (Denver), and SGS-CSTS
Ltd. (Tianjin), are independent international testing and certification service
companies, not to be confused with SouthGobi sands LLC. - 66 -




---



##### Table of Contents



situ tonnage and not adjusted for mining losses or recovery. However,
minimum mineable seam thickness and maximum removable parting thickness are considered; coal
intervals not meeting these criteria are not included in the resources.   CRITERIA USED TO DEFINE ASSURANCE OF EXISTENCE FOR COALS IN
COMPLEX GEOLOGY TYPE
 Assurance of Existence CategoryCriteria
    
    Measured
    
    Indicated
    
    InferredCross-section spacing (m)
    
    
    150
    
    
    
    300
    
    
    
    600Minimum # data points per section
    
    
    3
    
    
    
    3
    
    
    
    3Mean data point spacing (m)
    
    
    100
    
    
    
    200
    
    
    
    400Maximum data point spacing (m)
    
    
    200
    
    
    
    400
    
    
    
    800
  CLASSIFICATION OF RESOURCES GEOLOGY TYPE: COMPLEX*
 Resource Limits
    
    
    
    
    
    In-Place Resources (Million Tonnes)Area
    
    Type
    
    Depth (m)
    
    ASTM Group
    
    Measured
    
    
    Indicated
    
    
    InferredSunrise Field
    
    Surface
    
    Surface to 250 m
    
    hvB to hvA
    
    
    53.8
    
    
    
    15.7
    
    
    
    4.9Sunset Field
    
    Surface
    
    Surface to 250 m
    
    hvB to hvA
    
    
    82.1
    
    
    
    19.4
    
    
    
    8.1Sub-Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    135.9
    
    
    
    35.1
    
    
    
    13.0Sunrise Field
    
    Underground
    
    250 m to 600 m
    
    hvB to hvA
    
    
    11.2
    
    
    
    5.2
    
    
    
    11.2Sunset Field
    
    Underground
    
    250 m to 600 m
    
    hvB to hvA
    
    
    34.6
    
    
    
    27.8
    
    
    
    9.3Sub-Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45.8
    
    
    
    33.0
    
    
    
    20.5Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    181.7
    
    
    
    68.1
    
    
    
    33.5
 
 *
    
    Based on information as of June 1, 2009 MineSight TM
 - 67 -




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##### Table of Contents



Mineral Reserve Estimate
   SUMMARY OF ESTIMATED RESERVES OVOOT TOLGOI MINE
 Surface Mineable Reserves Tonnes in Millions*Reserve Area
    
    ASTM Coal Rank
    
    Proven
    
    Probable
    
    TotalOvoot Tolgoi open pit mine
    
    hvB to hvA
    
    105.0
    
    9.1
    
    114.1
 
 *
    
    Based on information as of July 1, 2009  Mining Operations
 Mining Method
  3 3 3 3
    - 68 -




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##### Table of Contents



Production Forecast
  LIFE OF MINE SUMMARY QUANTITIES
 Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year
    
    
    Year1
    
    
    2
    
    
    3
    
    
    4
    
    
    5
    
    
    6
    
    
    7
    
    
    8
    
    
    9
    
    
    10
    
    
    11
    
    
    12
    
    
    13
    
    
    14
    
    
    15
    
    
    16(in thousands)
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    2014
    
    
    2015
    
    
    2016
    
    
    2017
    
    
    2018
    
    
    2019
    
    
    2020
    
    
    2021
    
    
    2022
    
    
    2023
    
    
    2024
    
    
    TotalCoking Coal
(000 tonnes)
Tonnage Shipped
    
    
    340
    
    
    
    881
    
    
    
    366
    
    
    
    1,783
    
    
    
    735
    
    
    
    381
    
    
    
    981
    
    
    
    739
    
    
    
    823
    
    
    
    395
    
    
    
    440
    
    
    
    783
    
    
    
    1,160
    
    
    
    2,279
    
    
    
    1,989
    
    
    
    2,867
    
    
    
    16,941Cumulative Tonnage Shipped
    
    
    340
    
    
    
    1,220
    
    
    
    1,586
    
    
    
    3,369
    
    
    
    4,104
    
    
    
    4,485
    
    
    
    5,466
    
    
    
    6,205
    
    
    
    7,028
    
    
    
    7,423
    
    
    
    7863
    
    
    
    8,646
    
    
    
    9,806
    
    
    
    12,086
    
    
    
    14,074
    
    
    
    16,941Premium
Coal (000 tonnes)

Tonnage Shipped
    
    
    275
    
    
    
    1,084
    
    
    
    1,937
    
    
    
    5,192
    
    
    
    5,375
    
    
    
    3,335
    
    
    
    3,953
    
    
    
    3,047
    
    
    
    2,446
    
    
    
    6,829
    
    
    
    4,344
    
    
    
    1,084
    
    
    
    2,237
    
    
    
    2,062
    
    
    
    2,736
    
    
    
    1,345
    
    
    
    47,280Cumulative Tonnage Shipped
    
    
    275
    
    
    
    1,359
    
    
    
    3,296
    
    
    
    8,488
    
    
    
    13,863
    
    
    
    17,198
    
    
    
    21,151
    
    
    
    24,198
    
    
    
    26,643
    
    
    
    33,473
    
    
    
    37,817
    
    
    
    38,901
    
    
    
    41,137
    
    
    
    43,199
    
    
    
    45,935
    
    
    
    47,280THEQ + THE
Coal (000
tonnes)


Tonnage Shipped
    
    
    385
    
    
    
    2,035
    
    
    
    4,196
    
    
    
    1,026
    
    
    
    1,890
    
    
    
    4,283
    
    
    
    3,066
    
    
    
    4,215
    
    
    
    4,732
    
    
    
    776
    
    
    
    3,216
    
    
    
    6,133
    
    
    
    4,603
    
    
    
    3,659
    
    
    
    3,276
    
    
    
    2,403
    
    
    
    49,894Cumulative Tonnage Shipped
    
    
    385
    
    
    
    2,421
    
    
    
    6,617
    
    
    
    7,643
    
    
    
    9,533
    
    
    
    13,817
    
    
    
    16,882
    
    
    
    21,097
    
    
    
    25,829
    
    
    
    26,604
    
    
    
    29,820
    
    
    
    35,953
    
    
    
    40,556
    
    
    
    44,215
    
    
    
    47,491
    
    
    
    49,894Total Tonnage Shipped
    
    
    1,000
    
    
    
    4,000
    
    
    
    6,500
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    8,000
    
    
    
    6,614
    
    
    
    114,114Cumulative Tonnage Shipped
    
    
    1,000
    
    
    
    5,000
    
    
    
    11,500
    
    
    
    19,500
    
    
    
    27,501
    
    
    
    35,500
    
    
    
    43,500
    
    
    
    51,500
    
    
    
    59,501
    
    
    
    67,501
    
    
    
    75,500
    
    
    
    83,500
    
    
    
    91,500
    
    
    
    99,500
    
    
    
    107,500
    
    
    
    114,114
 Metallurgical Process
  - 69 -




---



##### Table of Contents



Coal Markets, Marketing and Sales Contracts
        - 70 -




---



##### Table of Contents



Environmental Conditions
      - 71 -




---



##### Table of Contents



Taxes
    Mine Life
  Expected
Payback Period of Capital
  - 72 -




---



##### Table of Contents



Other Projects
 Mongolia
 Metal Prospects
     Coal Prospects
   Kazakhstan
   - 73 -




---



##### Table of Contents



Australia
       
 - 74 -




---



##### Table of Contents



Other Information
 Equity Investments
  Company
    
    Number of Shares
    
    
    ValueEntrée Gold Inc. (TSX)
    
    
    13,799,333
    
    
    Cdn$34,498,333Intec Limited (ASX)
    
    
    41,174,840
    
    
    Aus$576,448Asia Now Resources Corp. (TSX-V)
    
    
    969,036
    
    
    Cdn$300,401Exco
Resources NL (ASX)(1)
    
    
    65,802,267
    
    
    Aus$14,805,510Emmerson
Resources Limited (ASX)(2)
    
    
    22,610,000
    
    
    Aus$6,330,800Kangaroo
Resources Limited (ASX)(3)
    
    
    50,000,000
    
    
    Aus$11,000,000Ivanhoe
Nickel & Platinum Ltd. (unlisted)(4)
    
    
    3,584,220

(5)
    
    
    $18,932,740

(6)
 
 (1)
    
    IVNs interest in Exco Resources NL is indirect, as IVNs subsidiary, Ivanhoe Australia
owns the 65,802,267 shares of Exco Resources NL.(2)
    
    IVNs interest in Emmerson Resources Limited is indirect, as IVNs subsidiary, Ivanhoe
Australia owns the 22,610,000 shares of Emmerson Resources Limited.(3)
    
    IVNs interest in Kangaroo Resources Limited is indirect, as IVNs subsidiary,
SouthGobi Energy Resources owns the 50,000,000 shares of Kangaroo Resources Limited.(4)
    
    IVNs Chairman, Robert M. Friedland, holds a voting equity ownership interest of 34% in
Ivanhoe Nickel & Platinum Ltd. (Ivanplats).(5)
    
    IVN also holds 1.1 million liquidity rights and 550,000 share purchase warrants of
Ivanplats. Each liquidity right is convertible into 0.1 of a common share of Ivanplats for
no additional consideration if a liquidity event (an initial public offering (IPO) or
other transaction that results in a public listing of Ivanplats common shares) does not
occur on or before December 31, 2010. The share purchase warrants vest upon the closing of
an IPO. If an IPO occurs prior to December 31, 2010, each share purchase warrant entitles
the holder to purchase one Ivanplats common share at the IPO price up until two years after
the closing of the IPO. If an IPO occurs after December 31, 2010, each share purchase
warrant entitles the holder to purchase 1.1 common shares at the IPO price up until two
years after the closing of the IPO.(6)
    
    Represents the aggregate acquisition cost of all Ivanplats securities held by IVN. Employees
  
 DIVIDENDS
  - 75 -




---



##### Table of Contents



DESCRIPTION OF CAPITAL STRUCTURE
  
 Common Shares
  
 Preferred Shares
   
 MARKET FOR SECURITIES
  - 76 -




---



##### Table of Contents



PERIOD
    
    HIGH
    
    LOW
    
    VOLUMEJanuary 2009
    
    $
    4.70
    
    
    $
    3.22
    
    
    
    20,975,661February 2009
    
    $
    6.00
    
    
    $
    3.20
    
    
    
    36,523,213March 2009
    
    $
    7.95
    
    
    $
    5.16
    
    
    
    38,966,077April 2009
    
    $
    8.90
    
    
    $
    6.51
    
    
    
    25,954,008May 2009
    
    $
    8.70
    
    
    $
    5.51
    
    
    
    34,906,649June 2009
    
    $
    7.54
    
    
    $
    5.59
    
    
    
    31,460,547July 2009
    
    $
    10.32
    
    
    $
    7.36
    
    
    
    45,509,445August 2009
    
    $
    12.50
    
    
    $
    8.00
    
    
    
    32,627,266September 2009
    
    $
    13.95
    
    
    $
    11.64
    
    
    
    31,229,582October 2009
    
    $
    14.45
    
    
    $
    11.21
    
    
    
    28,313,581November 2009
    
    $
    13.59
    
    
    $
    11.30
    
    
    
    21,922,183December 2009
    
    $
    15.85
    
    
    $
    12.26
    
    
    
    22,164,729
 
 DIRECTORS AND OFFICERS
 
 Name and Occupation
  Name and Municipality
    
    
    
    Principal Occupationof Residence
    
    Position with Company
    
    During Past Five YearsROBERT M. FRIEDLAND
Singapore
    
    Executive Chairman and Director
(Director since March 1994)
    
    Chairman of IVN
(March 1994 to
present); Chief
Executive Officer of
IVN (March 1994 to
May 2006); Executive
Co-Chairman,
President and CEO of
Ivanhoe Energy Inc.
(May 2008 to
present); Chairman
and President,
Ivanhoe Capital
Corporation (a
venture capital
company) (1988 to
present); Deputy
Chairman, Capital
Markets for Ivanhoe
Energy Inc. (June
1999 to March 2008).PETER G. MEREDITH
Vancouver, Canada
    
    Deputy Chairman and Director
(Director since March 2005)
    
    Deputy Chairman of
IVN (May 2006 to
present); Chief
Financial Officer of
IVN (May 2004 to May
2006); Chief
Financial Officer of
Ivanhoe Capital
Corporation (a
venture capital
company) (1996 to
March 2009); Chief
Executive Officer,
SouthGobi Energy
Resources (June 2007
to October 2009);
Chairman, SouthGobi
Energy Resources
(October 2009 to
present).
 - 77 -




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##### Table of Contents



Name and Municipality
    
    
    
    Principal Occupationof Residence
    
    Position with Company
    
    During Past Five YearsJOHN MACKEN
Massachusetts, USA
    
    Director, President and Chief
Executive Officer
(Director since January 2003)
    
    Chief Executive
Officer of IVN (May
2006 to present);
President of IVN
(January 2004 to
present); Chairman of
SouthGobi Energy
Resources (June 2007
to October 2009);
Consultant (2000 to
January 2004); and
Senior Vice President
of Freeport McMoran
Copper & Gold (a
mining company) (1996
to 2000).DAVID HUBERMAN
Vancouver, Canada
    
    Director (lead director)
(Director since September 2003)
    
    President, Coda
Consulting Corp.
(business consulting
firm) (1993 to
present).R. EDWARD FLOOD
Ketchum, Idaho
    
    Director
(Director since March 1995)
    
    Chairman of Western
Uranium Corporation
(March 2007 to
present); Managing
Director, Investment
Banking, Haywood
Securities (UK)
Limited (investment
dealer) (March 2007
to March 2010);
Deputy Chairman of
IVN (May 1999 to
February 2007);
Senior Mining
Analyst, Haywood
Securities Inc.
(investment dealer)
(May 1999 to November
2001).KJELD THYGESEN
London, England
    
    Director
(Director since February 2001)
    
    Managing Director,
Lion Resource
Management
(investment firm and
fund manager) (May
1989 to present).HON. ROBERT HANSON
London, England
    
    Director
(Director since February 2001)
    
    Chairman, Hanson
Capital Investments
Limited (investment
and finance company)
(February 1998 to
present); Chairman,
Strand Hanson Ltd.
(October 2009 to
present); Chairman,
Hanson Family Group
(formerly Hanson
Transport Group) (May
1990 to present).DR. MARKUS FABER
Hong Kong, China
    
    Director
(Director since February 2002)
    
    Managing Director,
Marc Faber Limited
(investment advisory
firm and fund
manager) (June 1990
to present).HOWARD BALLOCH
Beijing, China
    
    Director
(Director since March 2005)
    
    President, The
Balloch Group
(investment and
consulting company)
(July 2001 to
present);
Vice-Chairman,
Canada-China Business
Council (July 2001 to
present); Canadian
Ambassador to China,
Mongolia and
Democratic Republic
of Korea (April 1996
to July 2001).DAVID KORBIN
West Vancouver, Canada
    
    Director
(Director since May 2006)
    
    Independent
Management and
Financial Consultant
(May 1998 to
present).ANDREW HARDING
Surrey, England
    
    Director
(Director since November 2009)
    
    Chief Executive, Rio
Tinto Copper (October
2009 to present);
President and Chief
Executive, Kennecott
Utah Copper (November
2007 to October
2009); various other
positions within the
Rio Tinto Group (1992
to present).LIVIA MAHLER
Vancouver, Canada
    
    Director
(Director since March 2009)
    
    Partner and
co-founder,
Greenstone Venture
Partners (February
2000 to present).TONY GIARDINI
Vancouver, Canada
    
    Chief Financial Officer
    
    Chief Financial
Officer of IVN (May
2006 to present);
Vice-President and
Treasurer, Placer
Dome Inc. (a mining
company) (December
2003 to April 2006);
Treasurer, Placer
Dome Inc. (November
2002 to December
2003).DOUGLAS KIRWIN 
Bangkok, Thailand
    
    Executive Vice-President,
Exploration
    
    Executive
Vice-President,
Exploration of IVN
(September 1995 to
present).STEVEN GARCIA
North Carolina, USA
    
    Executive Vice President
    
    Executive Vice
President of IVN
(October 2005 to
present); Project
Director of IVN (May
2005 to present); CEO
Chamoa Farm, Inc. (a
wholesale landscaping
and nursery company)
(2001 to present).
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Name and Municipality
    
    
    
    Principal Occupationof Residence
    
    Position with Company
    
    During Past Five YearsDAVID WOODALL
Western Australia, Australia
    
    President, Gold Division
    
    President, Gold
Division of IVN
(August 2006 to
present); Operations
Manager of Robe River
Associates (a mining
company) (March 2005
to August 2006);
General Manager,
Operations of Sino
Gold Limited (a
mining company)
(April 2004 to
January 2005); Mine
General Manager of
Placer Dome Inc. (a
mining company) (July
2001 to 2004).RICHARD GOSSE
Richmond, Canada
    
    Vice President, Exploration
    
    Vice President,
Exploration of IVN
(January 2009 to
present); Vice
President,
Exploration, Metals
Division of SouthGobi
Energy Resources
(February 2004 to
December 2008);
Exploration Manager,
India, Hudson Bay
Exploration and
Development Company
Ltd. (January 2000 to
December 2003).JAY GOW 
Burnaby, Canada
    
    Vice President, Marketing
    
    Vice President,
Marketing of IVN (May
2004 to present);
Marketing Manager,
Copper & Molybdenum,
Compania Minera
Antamina S.A. (a
mining company)
(January 2001 to
December 2003).PIERRE MASSE 
West Vancouver, Canada
    
    Vice President, Finance
    
    Vice President,
Finance of IVN (May
2007 to present);
Vice President and
Treasurer of IVN (May
2004 to May 2007);
Chief Financial
Officer of IVN
(November 2001 to May
2004).BEVERLY A. BARTLETT 
New Westminster, Canada
    
    Vice President and Corporate
Secretary
    
    Vice President of IVN
(May 2006 to
present); Vice
President of
SouthGobi (May 2007
to present); Vice
President of Ivanhoe
Energy Inc. (August
2006 to present);
Vice President of
Jinshan Gold Mines
Ltd. (May 2007 to May
2008); Corporate
Secretary of IVN
(June 2001 to
present); Corporate
Secretary of
SouthGobi (August
2003 to present);
Corporate Secretary
of Ivanhoe Energy
Inc. (oil and gas
company) (May 2001 to
present); Corporate
Secretary of Jinshan
Gold Mines (May 2003
to May 2008).CATHERINE BARONE
Port Moody, Canada
    
    Vice President and Corporate
Controller
    
    Vice President of IVN
(May 2008 to
present); Controller
of IVN (November 2002
to present).GEOFFREY HARDING
Vancouver, Canada
    
    Vice President, Project
Evaluation and Development
    
    Vice President,
Project Evaluation
and Development of
IVN (May 2008 to
present); Manager of
Mining of IVN (July
2003 to May 2008).
  
 Shareholdings of Directors and Executive Officers
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Committees of the Board
  
 Conflicts of Interest
    
 Audit Committee Information
  
 INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
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Company Name
    
    Robert Friedland Ownership InterestIvanhoe Energy Inc.
    
    
    17.5
    %Ivanhoe Capital Corporation
    
    
    100
    %Ivanhoe Nickel & Platinum Ltd.
    
    
    33.7
    %SouthGobi Energy Resources Ltd.
    
    
    
    (1)GoviEx Gold Inc.
    
    
    
    (1)GoviEx Uranium Inc.
    
    Nil
 
 (1)
    
    As at December 31, 2009, Mr. Friedland owned 22.8% of the Common Shares of the Company,
which owned 78.6% of the common shares of SouthGobi Energy Resources
Ltd. (57.4% as of March 30,
2010) and 1.5% of GoviEx Gold Inc.  
    
    1.2 million common shares of Ivanplats from two institutional investors at an aggregate
acquisition cost of $1,842,000;
    
    220,000 common shares at a cost of $1,320,000 and 250,000 special warrants, convertible
into 250,000 common shares, at a cost of $1,500,000 from Kjeld Thygesen and Robert Hanson,
respectively, both directors of the Company; and
    
    1.1 million units of Ivanplats at a cost of $9,900,000 pursuant to a private placement.
Each unit is comprised of one common share, one liquidity right and one-half of one share
purchase warrant.
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TRANSFER AGENTS AND REGISTRARS
  
 MATERIAL CONTRACTS
 Continuous Disclosure Obligations
 1.
    
    Entrée Earn-in Agreement, pursuant to which IVN earned a participating interest in the Entrée
Joint Venture of 80% in respect of minerals below 560m and 70% in minerals above 560m by
having expended $35 million in earn-in expenditures on the areas of the Hugo North Extension
that are the subject of the Entrée Joint Venture.2.
    
    Head Agreement dated February 4, 2005 among IVN, Stemcor Pellets AG, Stemcor Holdings Ltd.
and Dominant Holdings AG, pursuant to which IVN disposed of its interest in the Savage River
Project. Under the terms of the agreement, IVN sold its interest in the Savage River Project
for two initial cash payments totalling $21.5 million, plus a series of five contingent,
annual payments that commenced on March 31, 2006. To date, IVN has received $137.9 million in
proceeds from the sale of the Savage River Project. At December 31, 2009, IVN had accrued a
$20.9 million receivable in relation to the fifth contingent annual payment due on March 31,
2010. This amount is calculated based upon the actual tonnes of iron ore sold during the
nine-month period that ended December 31, 2009, under the escalating price formula in the
agreement.3.
    
    Private Placement Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Rio Tinto
Transactions  Private Placement Agreement.4.
    
    Credit Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Rio Tinto Transactions  Credit
Agreement.5.
    
    Contract Assignment Arrangement Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Rio
Tinto Transactions  Contract Assignment Arrangement Agreement and Put Agreement.6.
    
    Put Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Rio Tinto Transactions  Contract
Assignment Arrangement Agreement and Put Agreement.7.
    
    Investment Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Agreements with the
Government of Mongolia  Investment Agreement.8.
    
    Shareholders Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Agreements with the
Government of Mongolia  Shareholders Agreement.9.
    
    T-Bill Purchase Agreement. See GENERAL DEVELOPMENT OF THE BUSINESS  Agreements with the
Government of Mongolia  T-Bill Purchase Agreement.
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INTERESTS OF EXPERTS
 
   
 ADDITIONAL INFORMATION
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SCHEDULE A  Audit Committee Information
 Composition of Audit Committee
  Relevant Education and Experience
 David Korbin
  Markus Faber
  Livia Mahler
  Kjeld Thygesen
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Audit Fees
   (Canadian $ in 000s)
    
    2009
    
    
    2008Audit Fees (a)
    
    $
    873
    
    
    $
    1,030Audit Related Fees (b)
    
    
    1,469
    
    
    
    1,960Tax Fees (c)
    
    
    26
    
    
    
    43All Other Fees (d)
    
    
    35
    
    
    
    297Total
    
    $
    2,403
    
    
    $
    3,330
 
 (a)
    
    Fees for audit services billed or expected to be billed relating to fiscal 2009 and 2008
consisted of:
 
    
    audit of the Companys annual statutory financial statements; and
    
    audit of its subsidiaries (SouthGobi Energy Resources Ltd. and Ivanhoe Australia
Limited), annual statutory financial statements.
 In addition, in 2009 and 2008 fees were paid for services provided in connection with review
pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 and the required attestations
relating to internal controls.
 (b)
    
    Fees for audit-related services provided during fiscal 2009 and 2008 consisted of:
 
    
    reviews of IVNs quarterly financial statements, SouthGobis quarterly financial
statements and Ivanhoe Australias half yearly statements; and
    
    translation services;
    
    financial accounting and reporting consultations;
    
    comfort letters, consents, and other services related to SEC, Canadian and other
securities regulatory authorities matters.
 (c)
    
    Fees for tax services provided during fiscal 2009 and 2008 consisted of income tax
compliance, and tax planning and advice relating to transactions and proposed transactions of
the Company and its subsidiaries.(d)
    
    The Company incurred fees of Cdn$35,000 and Cdn$297,000 for products and services
provided by its principal accountant during fiscal 2009 and 2008 not disclosed in subsections
(a), (b) or (c).
 Pre-Approval Policies and Procedures
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de minimis
   Audit Committee Charter
 I.
    
    Purpose
    II.
    
    Organization
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III.
    
    Meetings
      IV.
    
    Authority and Responsibilities
   (a)
    
    Auditors
 1.
    
    Recommend to the Board the independent auditors to be nominated for appointment as Auditors
of the Company at the Companys annual meeting and the remuneration to be paid to the Auditors
for services performed during the preceding year; approve all auditing services to be provided
by the Auditors; be responsible for the oversight of the work of the Auditors, including the
resolution of disagreements between management and the Auditors regarding financial reporting;
and recommend to the Board and the shareholders the termination of the appointment of the
Auditors, if and when advisable.2.
    
    When there is to be a change of the Auditor, review all issues related to the change,
including any notices required under applicable securities law, stock exchange or other
regulatory requirements, and the planned steps for an orderly transition.3.
    
    Review the Auditors audit plan and discuss the Auditors scope, staffing, materiality, and
general audit approach.
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4.
    
    Review on an annual basis the performance of the Auditors, including the lead audit partner.5.
    
    Take reasonable steps to confirm the independence of the Auditors, which include:
 (a)
    
    Ensuring receipt from the Auditors of a formal written statement in
accordance with applicable regulatory requirements delineating all relationships
between the Auditors and the Company;(b)
    
    Considering and discussing with the Auditors any disclosed
relationships or services, including non-audit services, that may impact the
objectivity and independence of the Auditors;(c)
    
    Approving in advance any non-audit related services provided by the
Auditor to the Company, and the fees for such services, with a view to ensure
independence of the Auditor, and in accordance with applicable regulatory
standards, including applicable stock exchange requirements with respect to
approval of non-audit related services performed by the Auditors; and(d)
    
    As necessary, taking or recommending that the Board take appropriate
action to oversee the independence of the Auditors.
 6.
    
    Review and approve any disclosures required to be included in periodic reports under
applicable securities law, stock exchange and other regulatory requirements with respect to
non-audit services.7.
    
    Confirm with the Auditors and receive written confirmation at least once per year (i)
indicating that the Auditors are a member in good standing with the Canadian Public
Accountability Board (CPAB) and comparable bodies in the United States, Australia and
elsewhere to the extent required and disclosing any sanctions or restrictions imposed by the
CPAB and such other comparable bodies; and (ii) responding to any other reasonable request of
the Audit Committee for confirmation as to their qualifications to act as the Companys
Auditors.8.
    
    Consider the tenure of the lead audit partner on the engagement in light of applicable
securities law, stock exchange or applicable regulatory requirements.9.
    
    Review all reports required to be submitted by the Auditors to the Committee under applicable
securities laws, stock exchange or other regulatory requirements.10.
    
    Receive all recommendations and explanations which the Auditors place before the Committee.
 (b)
    
    Financial Statements and Financial Information
 11.
    
    Review and discuss with management, the financial and accounting officer(s) and the Auditors,
the Companys annual audited financial statements, including disclosures made in managements
discussion and analysis, prior to filing or distribution of such statements and recommend to
the Board, if appropriate, that the Companys audited financial statements be included in the
Companys annual reports distributed and filed under applicable laws and regulatory
requirements.12.
    
    Review and discuss with management, the financial and accounting officer(s) and the Auditors,
the Companys interim financial statements, including managements discussion and analysis,
and the Auditors review of interim financial statements, prior to filing or distribution of
such statements.
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13.
    
    Review any earnings press releases of the Company before the Company publicly discloses this
information.14.
    
    Be satisfied that adequate procedures are in place for the review of the Companys disclosure
of financial information and extracted or derived from the Companys financial statements and
periodically assess the adequacy of these procedures.15.
    
    Discuss with the Auditor the matters required to be discussed by applicable auditing
standards requirements relating to the conduct of the audit including:
 (a)
    
    the adoption of, or changes to, the Companys significant auditing and
accounting principles and practices;(b)
    
    the management letter provided by the Auditor and the Companys
response to that letter; and(c)
    
    any difficulties encountered in the course of the audit work, including
any restrictions on the scope of activities or access to requested information, or
personnel and any significant disagreements with management.
 16.
    
    Discuss with management and the Auditors major issues regarding accounting principles used in
the preparation of the Companys financial statements, including any significant changes in
the Companys selection or application of accounting principles. Review and discuss analyses
prepared by management and/or the Auditors setting forth significant financial reporting
issues and judgments made in connection with the preparation of the financial statements,
including analyses of the effects of alternative approaches under generally accepted
accounting principles.17.
    
    Prepare any report under applicable securities law, stock exchange or other regulatory
requirements, including any reports required to be included in statutory filings, including in
the Companys annual proxy statement.(c)
    
    Ongoing Reviews and Discussions with Management and Others18.
    
    Obtain and review an annual report from management relating to the accounting principles used
in the preparation of the Companys financial statements, including those policies for which
management is required to exercise discretion or judgments regarding the implementation
thereof.19.
    
    Periodically review separately with each of management, the financial and accounting
officer(s) and the Auditors; (a) any significant disagreement between management and the
Auditors in connection with the preparation of the financial statements, (b) any difficulties
encountered during the course of the audit, including any restrictions on the scope of work or
access to required information and (c) managements response to each.20.
    
    Periodically discuss with the Auditors, without management being present, (a) their
judgments about the quality and appropriateness of the Companys accounting principles and
financial disclosure practices as applied in its financial reporting and (b) the completeness
and accuracy of the Companys financial statements.21.
    
    Consider and approve, if appropriate, significant changes to the Companys accounting
principles and financial disclosure practices as suggested by the Auditors or management and
the resulting financial statement impact. Review with the Auditors or management the extent
to which any changes or improvements in accounting or financial practices, as approved by the
Committee, have been implemented.
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22.
    
    Review and discuss with management, the Auditors and the Companys independent counsel, as
appropriate, any legal, regulatory or compliance matters that could have a significant impact
on the Companys financial statements, including applicable changes in accounting standards or
rules, or compliance with applicable laws and regulations, inquiries received from regulators
or government agencies and any pending material litigation.23.
    
    Enquire of the Companys financial and accounting officer(s) and the Auditors on any matters
which should be brought to the attention of the Committee concerning accounting, financial and
operating practices and controls and accounting practices of the Company.24.
    
    Review the principal control risks to the business of the Company, its subsidiaries and joint
ventures; and verify that effective control systems are in place to manage and mitigate these
risks.25.
    
    Review and discuss with management any earnings press releases, including the use of pro
forma or adjusted non-GAAP information, as well as any financial information and earnings
guidance provided to analysts and rating agencies. Such discussions may be done generally
(i.e. discussion of the types of information to be disclosed and the types of presentations
made).26.
    
    Review and discuss with management any material off-balance sheet transactions, arrangements,
obligations (including contingent obligations) and other relationships of the Company with
unconsolidated entities or other persons, that may have a material current or future effect on
financial condition, changes in financial condition, results of operations, liquidity, capital
resources, capital reserves or significant components of revenues or expenses. Obtain
explanations from management of all significant variances between comparative reporting
periods.27.
    
    Review and discuss with management the Companys major risk exposures and the steps
management has taken to monitor, control and manage such exposures, including the Companys
risk assessment and risk management guidelines and policies.(d)
    
    Risk Management and Internal Controls28.
    
    Review, based upon the recommendation of the Auditors and management, the scope and plan of
the work to be done by the Companys financial and accounting group and the responsibilities,
budget and staffing needs of such group.29.
    
    Ensure that management has designed and implemented effective systems of risk management and
internal controls and, at least annually, review and assess the effectiveness of such systems.30.
    
    Approve and recommend to the Board for adoption policies and procedures on risk oversight and
management to establish an effective system for identifying, assessing, monitoring and
managing risk.31.
    
    In consultation with the Auditors and management, review the adequacy of the Companys
internal control structure and procedures designed to insure compliance with laws and
regulations, and discuss the responsibilities, budget and staffing needs of the Companys
financial and accounting group.32.
    
    Establish procedures for (a) the receipt, retention and treatment of complaints received by
the Company regarding accounting, internal accounting controls or auditing matters and (b) the
confidential, anonymous submission by employees of the Company of concerns regarding
questionable accounting or auditing matters.
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33.
    
    Review the internal control reports prepared by management, including managements assessment
of the effectiveness of the Companys internal control structure and procedures for financial
reporting and (ii) the Auditors attestation, and report, on the assessment made by
management.34.
    
    Review the appointment of the chief financial officer and any key financial executives
involved in the financial reporting process and recommend to the Board any changes in such
appointment.(e)
    
    Other Responsibilities35.
    
    Create an agenda for the ensuing year and confirm a timetable for the Audit Committee for the
ensuing year.36.
    
    Review and approve related-party transactions if required under applicable securities law,
stock exchange or other regulatory requirements.37.
    
    Review and approve (a) any change or waiver in the Companys code of ethics applicable to
senior financial officers and (b) any disclosures made under applicable securities law, stock
exchange or other regulatory requirements regarding such change or waiver.38.
    
    Establish, review and approve policies for the hiring of employees or former employees of the
Companys Auditors.39.
    
    Review and reassess the duties and responsibilities set out in this Charter annually and
recommend to the Corporate Governance & Nominating Committee and to the Board any changes
deemed appropriate by the Committee.40.
    
    Review its own performance annually, seeking input from management and the Board.41.
    
    Perform any other activities consistent with this Charter, the Companys articles and by-laws
and governing law, as the Committee or the Board deems necessary or appropriate.V.
    
    Reporting
  VI.
    
    Resources and Access to Information
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- ix -