##### 



IVANHOE MINES LTD.
 Annual Information Form




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2  
 TABLE OF CONTENTS
 CORPORATE STRUCTURE
    
    
    10GENERAL DEVELOPMENT OF THE BUSINESS
    
    
    11Overview
    
    
    11Three Year History
    
    
    11Outlook
    
    
    14Risk Factors
    
    
    14DESCRIPTION OF THE BUSINESS
    
    
    25Overview
    
    
    25Qualified Persons
    
    
    25Oyu Tolgoi Copper and Gold Project, Mongolia
    
    
    25Mongolian Coal Division
    
    
    46Coal Reorganization Transaction
    
    
    47Nariin Sukhait Project
    
    
    47Other Coal Projects
    
    
    57Other Projects
    
    
    60Mongolia
    
    
    60Kazakhstan
    
    
    61Australia
    
    
    62China
    
    
    64Other Business Matters
    
    
    64Myanmar Trust Arrangements
    
    
    64Equity Holdings
    
    
    65Employees
    
    
    66DIVIDENDS
    
    
    66DESCRIPTION OF CAPITAL STRUCTURE
    
    
    66MARKET FOR SECURITIES
    
    
    67DIRECTORS AND OFFICERS
    
    
    68INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
    
    
    72TRANSFER AGENTS AND REGISTRARS
    
    
    72MATERIAL CONTRACTS
    
    
    73INTERESTS OF EXPERTS
    
    
    73ADDITIONAL INFORMATION
    
    
    74SCHEDULE A
    
    
    75




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3  Forward-Looking Information
    Currency and Exchange Rates
 .




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4   Year Ended December 312006
    
    2005
    
    2004
    
    2003
    
    2002End of period
    
    
    1.1653
    
    
    
    1.1659
    
    
    
    1.2036
    
    
    
    1.2924
    
    
    
    1.5796High for the period
    
    
    1.1726
    
    
    
    1.2704
    
    
    
    1.3968
    
    
    
    1.5777
    
    
    
    1.6184Low for the period
    
    
    1.0990
    
    
    
    1.1507
    
    
    
    1.1774
    
    
    
    1.2839
    
    
    
    1.5155Average for the period
    
    
    1.1342
    
    
    
    1.2116
    
    
    
    1.3015
    
    
    
    1.40146
    
    
    
    1.5703
  Defined Terms and Abbreviations
  AMEC
 Asia Gold
 Au
 BHP Exploration
 CIM
 CIM Standards
 Coal Division
 Coal Reorganization
 Common Shares
 Corporation
 Cu
 CuEq
 Entrée
 Excluded Persons
 g/t




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5 GSC Paper 88  21
 GRD Minproc
 Hugo Dummett Deposits
 Hugo North
 Hugo North Extension
 Hugo South
 IMMI
 Integrated Development Plan IDP
 Investment Agreement
 IVN
 IVN Group
 Jinshan
 km
 km 2
 lb
 m
 MEL
 Monywa Copper Project
 Monywa Trust
 Myanmar Assets
 Nariin Sukhait Project
 Nariin Sukhait Technical Report
 NI 43-101
 Norwest
 OT Technical Committee
 Oyu Tolgoi Project




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6 Oyu Tolgoi Technical Report
 oz
 Preferred Shares
 Rio Tinto
 Rio Tinto Transaction
 Savage River Project
 Southern Oyu Deposits
 tpd
 tpy
 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 Geological and Mining Terms
 anomaly:
 assay:
 chalcocite:
 chalcopyrite:
 concentrate:
 concentrator:
 covellite:




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7 cut-off grade:
 dyke:
 fault:
 feasibility study:
 flotation:
 gangue:
 hypogene:
 HQ:
 indicated mineral resource:
 inferred mineral resource:
 intrusive:
 IP:
 kriging:
 leach:
 measured mineral resource:




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8 mineral reserve:
 mineral resource (deposit):
 NQ:
 porphyry:
 preliminary assessment
 preliminary feasibility study pre-feasibility study
 probable reserve:
 proven reserve:
 PQ:
 qualified person:
 QMD or quartz monzodiorite:
 RC:
 seam:




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9 splits:
 stock:
 strike:
 sulphides:
 supergene:




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10 
 CORPORATE STRUCTURE
 Name, Address and Incorporation
 Business Corporations
Act
  Intercorporate Relationships
  Name of Subsidiary
    
    Jurisdiction of Incorporation
    
    Applicable Material PropertyIvanhoe Mines Delaware Holdings, LLC
    
    Delaware
    
    Oyu TolgoiIvanhoe Mines Aruba Holdings LLC
    
    Aruba
    
    Oyu TolgoiIvanhoe Mines Mongolia Inc.
    
    British Virgin Islands
    
    Oyu TolgoiIvanhoe Mines Mongolia Inc. XXK
    
    Mongolia
    
    Oyu TolgoiIvanhoe Resources Ltd. (1)
    
    British Columbia
    
    Nariin SukhaitCarbonado Holding Company Ltd. (1)
    
    British Virgin Islands
    
    Nariin SukhaitIvanhoe Coal Holding Company Ltd .(1)
    
    British Virgin Islands
    
    Nariin SukhaitSouth Gobi Sands LLC (1)
    
    Mongolia
    
    Nariin Sukhait
 
 (1)
    
    The ownership structure set forth herein for Nariin Sukhait represents the ownership chain
established to effect the Coal Reorganization. Upon completion of the Coal Reorganization these
corporations will become wholly-owned subsidiaries of Asia Gold. For further information see
DESCRIPTION OF THE BUSINESS  Mongolian Coal Division  Coal Reorganization Transaction.




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11 
 GENERAL DEVELOPMENT OF THE BUSINESS
 
 Overview
  
 Three Year History
  2004




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12  2005




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13 2006
         2007 to date




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14  
 Outlook
      
 Risk Factors
 IVN may be unsuccessful in completing an Investment Agreement with the Government of Mongolia
for the Oyu Tolgoi Project or may only be able to complete the contract on terms that
effectively impair the economic viability of the project.




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15  IVNs ability to carry on business in Mongolia is subject to political risk.
    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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16  The Hugo Dummett Deposit mineral resources and the Nariin Sukhait mineral resources do not have
demonstrated economic viability and the feasibility of mining has not been established.
  Lack of infrastructure in proximity to IVNs material properties could adversely affect mining
feasibility.
  Mining projects are sensitive to the volatility of metal prices.




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17   Copper
    
    GoldYear
    
    High
    
    Low
    
    Average
    
    High
    
    Low
    
    Average2001
    
    $
    0.83
    
    
    $
    0.60
    
    
    $
    0.72
    
    
    $
    293
    
    
    $
    256
    
    
    $
    2712002
    
    $
    0.77
    
    
    $
    0.65
    
    
    $
    0.71
    
    
    $
    349
    
    
    $
    278
    
    
    $
    3102003
    
    $
    1.05
    
    
    $
    0.71
    
    
    $
    0.81
    
    
    $
    416
    
    
    $
    320
    
    
    $
    3632004
    
    $
    1.49
    
    
    $
    1.06
    
    
    $
    1.30
    
    
    $
    454
    
    
    $
    375
    
    
    $
    4092005
    
    $
    2.11
    
    
    $
    1.39
    
    
    $
    1.67
    
    
    $
    536
    
    
    $
    411
    
    
    $
    4442006
    
    $
    3.99
    
    
    $
    2.06
    
    
    $
    3.05
    
    
    $
    725
    
    
    $
    524
    
    
    $
    604
 IVNs business in Mongolia may be harmed if the country fails to complete its transition from
state socialism and a planned economy to political democracy and a free market economy.
  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.




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18  IVN may experience difficulties with its joint venture partners.
  IVN may be unable to enforce its legal rights in certain circumstances.
  The Monywa Trust may not be able to sell the interest in the Myanmar Assets on a timely basis or
for its fair value .
  Changes in, or more aggressive enforcement of, laws and regulations could adversely impact IVNs
business.




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19  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.
  The actual cost of developing the Oyu Tolgoi Project may differ significantly from IVNs
estimates and involve unexpected problems or delays.




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20 
    
    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 financing arrangements.
  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.




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21 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.
  IVN has a limited operating history, and there is no assurance that it will be capable of
consistently producing positive cash flows.
  A substantial portion of IVNs operations involve exploration and development and there is no
guarantee that any such activity will result in commercial production of mineral deposits.




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22 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; 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.
  As a result of the rights to acquire common shares and other rights granted to Rio Tinto
pursuant to the Rio Tinto Transaction, Rio Tinto has the ability to significantly influence the
business and affairs of the Corporation.




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##### 



23  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.




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24 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.
 Business Corporations
Act




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25 
 DESCRIPTION OF THE BUSINESS
 
 Overview
  
 Qualified Persons
  Relationship toProperty
    
    
    Qualified Person
    
    
    CorporationOyu Tolgoi Project
    
    
    Bernard Peters, GRD Minproc
    
    
    Independent ConsultantNariin Sukhait Project
    
    
    Richard D. Tifft, Norwest
    
    
    Independent Consultant
 
 Oyu Tolgoi Copper and Gold Project, Mongolia
  Project Description and Location




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26     Environment




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##### 



27   Accessibility, Climate, Local Resources and Physiography




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28    History
  2




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29     www.sedar.com
 Geology and Mineralization




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30    Southern Oyu Deposits




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##### 



31   Hugo Dummett Deposits




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##### 



32      Exploration




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##### 



33      Drilling




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34    Sampling, Analysis and Security




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35   Mineral Reserves and Resources




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##### 



36 Total Oyu Tolgoi Project Resources (1)(2)  (based on a 0.60% copper equivalent cut-off) (3)
 Contained Metal(5)Resource
    
    
    
    
    
    
    
    Cu
    
    
    Au
    
    
    CuEq(4)
    
    
    Cu
    
    
    Au
    
    
    CuEq(4)Category
    
    
    Tonnes
    
    
    (%)
    
    
    (g/t)
    
    
    (%)
    
    
    (000 lbs)
    
    
    (ounces)
    
    
    (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
    
    
    
    1,397,130,000
    
    
    
    
    0.98
    
    
    
    
    0.24
    
    
    
    
    1.13
    
    
    
    
    30,190,000
    
    
    
    
    10,780,000
    
    
    
    
    34,810,000
 Notes:(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)
    
    This chart includes estimated resources on the Hugo North Extension Deposits located on
the Shivee Tolgoi Property, which property is owned by Entrée but subject to earn-in rights
by IVN. The estimate includes indicated resources of 117,000,000 tonnes grading 1.8%
copper and 0.61 g/t gold and inferred resources of 95,500,000 tonnes grading 1.15% copper
and 0.31 g/t gold at a 0.6% cut-off grade on the Hugo North Extension.(3)
    
    The 0.6% CuEq cut-off has been used to enable comparison with previous disclosures.(4)
    
    CuEq has been calculated using assumed metal prices ($0.80/lb. for copper and $350/oz
for gold); %CuEq. = % Cu + Au (g/t) x (11.25/17.64).(5)
    
    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.




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37 Southern Oyu Resources
  Southern Oyu Deposits (1)(2)
 Contained Metals(4)CuEq
    
    
    Tonnage
    
    
    Cu
    
    
    Au
    
    
    CuEq
    
    
    Cu
    
    
    Au
    
    
    CuEq(3)Southern Oyu 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
    
    
    
    
    3,113,0000.7
    
    
    
    
    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
 Notes:(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 ($0.80/lb. for copper and $350/oz
for gold);
%CuEq. = % Cu + Au (g/t) x (11.25/17.64).(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.




---



##### 



38   Hugo Dummett Mineral Resources
    st




---



##### 



39 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
    
    
    
    
    37,611,000Inferred (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
 Notes:(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 ($0.80/lb. for copper and $350/oz
for gold); %CuEq. = % Cu + Au (g/t) x (11.25/17.64).(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 the Shivee Tolgoi Property, which property is
owned by Entrée but subject to earn-in rights in favour of the Corporation.




---



##### 



40 Hugo North Mineral Resource Inventory (1)  Indicated
 Contained Metal(3)Class
    
    
    CuEq
    
    
    Tonnage
    
    
    Cu
    
    
    Au
    
    
    CuEq(2)
    
    
    Cu
    
    
    Au
    
    
    CuEq(2)Hugo North Deposit
    
    
    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 Extension)(4)
    
    
    3.5
    
    
    
    22,300,000
    
    
    
    
    3.68
    
    
    
    
    1.43
    
    
    
    
    4.59
    
    
    
    
    1,809,000
    
    
    
    
    1,030,000
    
    
    
    
    2,257,0003
    
    
    
    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
    
    
    3
    
    
    
    207,400,000
    
    
    
    
    3.47
    
    
    
    
    0.91
    
    
    
    
    4.05
    
    
    
    
    15,866,000
    
    
    
    
    6,070,000
    
    
    
    
    18,518,000Hugo North
    
    
    2
    
    
    
    329,200,000
    
    
    
    
    3.00
    
    
    
    
    0.76
    
    
    
    
    3.48
    
    
    
    
    21,773,000
    
    
    
    
    8,040,000
    
    
    
    
    25,257,000Extension(4))
    
    
    1
    
    
    
    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
 Inferred
 Class
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Contained Metal(3)Hugo North
    
    
    CuEq
    
    
    Tonnage
    
    
    Cu
    
    
    Au
    
    
    CuEq(2)
    
    
    Cu
    
    
    Au
    
    
    CuEq(2)Deposit
    
    
    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
    
    
    >= 3.5
    
    
    
    1,400,000
    
    
    
    
    3.32
    
    
    
    
    1.03
    
    
    
    
    3.98
    
    
    
    
    102,000
    
    
    
    
    50,000
    
    
    
    
    123,000(Hugo North
Extension)(4)
    
    
    >= 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
Hugo North

Extension(4))
    
    
    >= 3.5
    
    
    
    5,000,000
    
    
    
    
    3.13
    
    
    
    
    1.30
    
    
    
    
    3.96
    
    
    
    
    345,000
    
    
    
    
    210,000
    
    
    
    
    437,000>= 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
 Notes:(1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility study or pre-feasibility study.




---



##### 



41 (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 ($0.80/lb. for copper and $350/oz
for gold); %CuEq. = % Cu + Au (g/t) x (11.25/17.64).(4)
    
    The Hugo North Extension is located on the Shivee Tolgoi Property, which property is
owned by Entrée but subject to earn-in rights in favour of the Corporation.  Hugo South Mineral Resource Inventory (1)
 Contained Metal(3)Hugo South
    
    
    CuEq
    
    
    Tonnage
    
    
    Cu
    
    
    Au
    
    
    CuEq(2)
    
    
    Cu
    
    
    Au
    
    
    CuEq(3)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
 Notes:(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 ($0.80/lb. for copper and $350/oz
for gold); %CuEq. = % Cu + Au (g/t) x (11.25/17.64).(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. Southern Oyu Mineral Reserves
  Southern Oyu Mineral Reserves  March 2007
 CuEq
    
    
    Recovered
    
    
    RecoveredNSR
    
    
    Copper
    
    
    Gold
    
    
    Grade
    
    
    Copper
    
    
    GoldClass
    
    
    Ore (tonnes)
    
    
    $/t
    
    
    (%)
    
    
    (g/t )
    
    
    (%)
    
    
    (000 lbs)
    
    
    (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




---



##### 



42    Mineral Processing and Metallurgical Testing




---



##### 



43    Mine Planning
    2005 IDP Mine Plan




---



##### 



44




---



##### 



45   Southern Oyu Open Pit Reserve Financial Results
  Post-IDP Engineering and Construction




---



##### 



46 Development to Date
     Current Exploration Activities
    
 Mongolian Coal Division




---



##### 



47   
 Coal Reorganization Transaction
   
 Nariin Sukhait Project
  Project Description and Location
  2
 2




---



##### 



48 2
  Accessibility, Climate, Local Resources, Infrastructure and Physiography
     History




---



##### 



49  Geology
  Regional Setting
  Coal Occurrences
     Structural Geology




---



##### 



50     Deposit Types
  Mineralization




---



##### 



51 Nariin Sukhait Property Coal Seam Characteristics
South-East Field
 Seam/Series
    
    
    Seam
    
    
    Count
    
    
    Thickness Range (m)(1)
    
    
    Mean Thickness (m)(1)5
    
    
    592U
    
    
    
    1
    
    
    
    
    21.9 -21.9
    
    
    
    
    21.9590U
    
    
    
    14
    
    
    
    
    1-23.4
    
    
    
    
    8.8580U
    
    
    
    15
    
    
    
    
    0.96 - 8.6
    
    
    
    
    4.5570U
    
    
    
    17
    
    
    
    
    0.6-11.7
    
    
    
    
    4.55U
    
    
    
    38
    
    
    
    
    1.04 -74.1
    
    
    
    
    24.2SUB
    
    
    
    28
    
    
    
    
    0.9 -53.1
    
    
    
    
    6.0S80
    
    
    
    26
    
    
    
    
    1.06 - 16.6
    
    
    
    
    3.6S70
    
    
    
    48
    
    
    
    
    1.2-30.7
    
    
    
    
    8.15
    
    
    
    97
    
    
    
    
    0.9 - 156.7
    
    
    
    
    53.4SB
    
    
    
    44
    
    
    
    
    0.6 - 100.1
    
    
    
    
    15.54
    
    
    4
    
    
    
    19
    
    
    
    
    1 - 30.3
    
    
    
    
    7.67
 (1)
    
    Based on apparent thickness of drill intercepts West FieldSeam/Series
    
    
    Seam
    
    
    Count
    
    
    Thickness Range (m)(1)
    
    
    Mean Thickness (m)(1)10
    
    
    1050
    
    
    
    23
    
    
    
    
    0.34 - 16
    
    
    
    
    2.71040
    
    
    
    33
    
    
    
    
    036 - 14
    
    
    
    
    341030
    
    
    
    39
    
    
    
    
    05 - 47
    
    
    
    
    221020
    
    
    
    49
    
    
    
    
    0.78 - 10.28
    
    
    
    
    3.41010
    
    
    
    45
    
    
    
    
    0.6 - 6.08
    
    
    
    
    2.910
    
    
    
    57
    
    
    
    
    1.9 - 19.76
    
    
    
    
    9.49
    
    
    998
    
    
    
    19
    
    
    
    
    0.48 - 4.16
    
    
    
    
    1.8996
    
    
    
    15
    
    
    
    
    044 - 55
    
    
    
    
    30990
    
    
    
    56
    
    
    
    
    0.46 - 5.1
    
    
    
    
    1.6980
    
    
    
    77
    
    
    
    
    1 - 279
    
    
    
    
    85970
    
    
    
    68
    
    
    
    
    06 - 918
    
    
    
    
    32960
    
    
    
    65
    
    
    
    
    06 - 68
    
    
    
    
    22950
    
    
    
    67
    
    
    
    
    0.46 - 11.7
    
    
    
    
    1.7942
    
    
    
    43
    
    
    
    
    0.28 - 5.16
    
    
    
    
    1.5940
    
    
    
    88
    
    
    
    
    2.1 - 31
    
    
    
    
    13.09
    
    
    
    75
    
    
    
    
    0.7 - 7
    
    
    
    
    2.38
    
    
    811
    
    
    
    25
    
    
    
    
    0.5 - 4.4
    
    
    
    
    1.9810
    
    
    
    84
    
    
    
    
    0.16 - 17.6
    
    
    
    
    4.68
    
    
    
    44
    
    
    
    
    0.34 - 12
    
    
    
    
    2.25
    
    
    5
    
    
    
    47
    
    
    
    
    1.38 - 134.24
    
    
    
    
    51.5SB
    
    
    
    12
    
    
    
    
    1.26 - 14.7
    
    
    
    
    6.4SL
    
    
    
    15
    
    
    
    
    3.56 - 141.24
    
    
    
    
    43.1
 (1)
    
    Based on apparent thickness of drill intercepts




---



##### 



52 Exploration
    Drilling




---



##### 



53 Drill Hole Summary
 ReverseCirculation
    
    
    Rotary
    
    
    Core
    
    
    Combination(1)No.
    
    
    Meters
    
    
    No.
    
    
    Meters
    
    
    No.
    
    
    Meters
    
    
    No.
    
    
    MetersArea
    
    
    Year
    
    
    Holes
    
    
    Drilled
    
    
    Holes
    
    
    Drilled
    
    
    Holes
    
    
    Cored
    
    
    Holes
    
    
    Cored2004
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5
    
    
    
    
    750
    
    
    
    
    
    
    
    
    
    South-East Field
    
    
    
    2005
    
    
    
    
    76
    
    
    
    
    14,425
    
    
    
    
    18
    
    
    
    
    2,807
    
    
    
    
    34
    
    
    
    
    5,524
    
    
    
    
    
    
    
    
    
    2006
    
    
    
    
    11
    
    
    
    
    4,855
    
    
    
    
    12
    
    
    
    
    1,999
    
    
    
    
    5
    
    
    
    
    1,860
    
    
    
    
    7
    
    
    
    NA(2)West Field
    
    
    
    2005
    
    
    
    
    70
    
    
    
    
    12,861
    
    
    
    
    17
    
    
    
    
    2,223
    
    
    
    
    13
    
    
    
    
    2,034
    
    
    
    
    
    
    
    
    
    2006
    
    
    
    
    48
    
    
    
    
    10,203
    
    
    
    
    0
    
    
    
    
    0
    
    
    
    
    25
    
    
    
    
    5,737
    
    
    
    
    
    
    
    
    
    Exploration Prospects
    
    
    
    2005
    
    
    
    
    62
    
    
    
    
    9,625
    
    
    
    
    44
    
    
    
    
    5,753
    
    
    
    
    14
    
    
    
    
    1,256
    
    
    
    
    
    
    
    
    
    2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34
    
    
    
    
    5,173
    
    
    
    
    7
    
    
    
    
    893
    
    
    
    
    
    
    
    
    
    Subtotals
    
    
    
    
    
    
    
    
    267
    
    
    
    
    51,969
    
    
    
    
    125
    
    
    
    
    17,955
    
    
    
    
    103
    
    
    
    
    18,054
    
    
    
    
    7
    
    
    
    NA(2)
 (1)
    
    Combination holes with RC and/or PCD rotary and/or core method.(2)
    
    Meters drilled and recorded as RC Rotary or Core meters. Sampling Method and Approach
      Sample Preparation, Analysis and Security




---



##### 



54  Core drill Samples
     Reverse Circulation Samples
   Data Verification




---



##### 



55    Mineral Processing And Metallurgical Testing
    Summary of Drill Hole Quality Data
 South-East FieldThickness1
    
    
    Mean
    
    
    Total
    
    
    Residual
    
    
    
    
    
    
    
    
    
    
    
    
    Specific
    
    
    FreeRange
    
    
    Thickness1
    
    
    Moisture2
    
    
    Moisture2
    
    
    Ash2
    
    
    Sulphur2
    
    
    Energy2
    
    
    SwellSeries
    
    
    Seam
    
    
    Count
    
    
    (m)
    
    
    (m)
    
    
    %
    
    
    %
    
    
    %
    
    
    %
    
    
    (kCal/kg)
    
    
    Index25-Series
    
    
    
    592U
    
    
    
    
    1
    
    
    
    
    21.9 - 21.9
    
    
    
    
    21.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    590U
    
    
    
    
    14
    
    
    
    
    1 - 23.4
    
    
    
    
    8.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    580U
    
    
    
    
    15
    
    
    
    
    0.96 - 8.6
    
    
    
    
    4.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    570U
    
    
    
    
    17
    
    
    
    
    0.6 - 11.5
    
    
    
    
    4.5
    
    
    
    
    11.98
    
    
    
    
    1.54
    
    
    
    
    30.18
    
    
    
    
    2.09
    
    
    
    
    5,518
    
    
    
    
    4.35U
    
    
    
    
    38
    
    
    
    
    1.04 - 74.1
    
    
    
    
    24.2
    
    
    
    
    5.47
    
    
    
    
    1.09
    
    
    
    
    20.89
    
    
    
    
    1.15
    
    
    
    
    6,235
    
    
    
    
    1.35UB
    
    
    
    
    28
    
    
    
    
    0.9 - 53.1
    
    
    
    
    6
    
    
    
    
    5.02
    
    
    
    
    1.15
    
    
    
    
    15.24
    
    
    
    
    1.09
    
    
    
    
    6,760
    
    
    
    
    1.4580
    
    
    
    
    26
    
    
    
    
    1.06 - 16.6
    
    
    
    
    3.6
    
    
    
    
    6.88
    
    
    
    
    0.97
    
    
    
    
    37.15
    
    
    
    
    1.03
    
    
    
    
    4,851
    
    
    
    
    1.9570
    
    
    
    
    48
    
    
    
    
    1.2 - 30.7
    
    
    
    
    8.1
    
    
    
    
    7.04
    
    
    
    
    1.40
    
    
    
    
    25.17
    
    
    
    
    1.26
    
    
    
    
    5,896
    
    
    
    
    2.25
    
    
    
    
    97
    
    
    
    
    0.9 - 156.7
    
    
    
    
    53.4
    
    
    
    
    5.78
    
    
    
    
    1.16
    
    
    
    
    18.22
    
    
    
    
    1.28
    
    
    
    
    6,528
    
    
    
    
    3.05B
    
    
    
    
    44
    
    
    
    
    0.6 - 100.1
    
    
    
    
    15.5
    
    
    
    
    7.08
    
    
    
    
    1.25
    
    
    
    
    20.48
    
    
    
    
    1.24
    
    
    
    
    6,322
    
    
    
    
    4.24-Series
    
    
    
    4
    
    
    
    
    19
    
    
    
    
    1 - 30.3
    
    
    
    
    7.67
    
    
    
    
    7.22
    
    
    
    
    0.83
    
    
    
    
    31.01
    
    
    
    
    0.71
    
    
    
    
    5,564
    
    
    
    
    1.0West Field10-Series
    
    
    
    1050
    
    
    
    
    23
    
    
    
    
    0.34 - 16
    
    
    
    
    2.7
    
    
    
    
    2.90
    
    
    
    
    1.00
    
    
    
    
    35.57
    
    
    
    
    1.25
    
    
    
    
    4,856
    
    
    
    
    1.21040
    
    
    
    
    33
    
    
    
    
    0.36 - 14
    
    
    
    
    3.4
    
    
    
    
    3.63
    
    
    
    
    1.26
    
    
    
    
    30.78
    
    
    
    
    1.40
    
    
    
    
    5,157
    
    
    
    
    1.51030
    
    
    
    
    39
    
    
    
    
    0.5 - 4.7
    
    
    
    
    2.2
    
    
    
    
    4.59
    
    
    
    
    1.47
    
    
    
    
    28.37
    
    
    
    
    1.29
    
    
    
    
    5,628
    
    
    
    
    2.21020
    
    
    
    
    49
    
    
    
    
    0.78 - 10.28
    
    
    
    
    3.4
    
    
    
    
    4.65
    
    
    
    
    1.55
    
    
    
    
    25.20
    
    
    
    
    1.03
    
    
    
    
    5,915
    
    
    
    
    1.5




---



##### 



56 South-East FieldThickness1
    
    
    Mean
    
    
    Total
    
    
    Residual
    
    
    
    
    
    
    
    
    
    
    
    
    Specific
    
    
    FreeRange
    
    
    Thickness1
    
    
    Moisture2
    
    
    Moisture2
    
    
    Ash2
    
    
    Sulphur2
    
    
    Energy2
    
    
    SwellSeries
    
    
    Seam
    
    
    Count
    
    
    (m)
    
    
    (m)
    
    
    %
    
    
    %
    
    
    %
    
    
    %
    
    
    (kCal/kg)
    
    
    Index21010
    
    
    
    
    45
    
    
    
    
    0.6 - 6.08
    
    
    
    
    2.9
    
    
    
    
    3.96
    
    
    
    
    1.21
    
    
    
    
    28.47
    
    
    
    
    0.87
    
    
    
    
    5,531
    
    
    
    
    1.510
    
    
    
    
    57
    
    
    
    
    1.9 - 19.76
    
    
    
    
    9.4
    
    
    
    
    3.19
    
    
    
    
    1.30
    
    
    
    
    25.02
    
    
    
    
    1.20
    
    
    
    
    5,776
    
    
    
    
    1.89-Series
    
    
    
    998
    
    
    
    
    19
    
    
    
    
    0.48 - 4.16
    
    
    
    
    1.8
    
    
    
    
    5.43
    
    
    
    
    1.92
    
    
    
    
    21.13
    
    
    
    
    1.39
    
    
    
    
    6,275
    
    
    
    
    1.0996
    
    
    
    
    15
    
    
    
    
    0.44 - 5.5
    
    
    
    
    3
    
    
    
    
    4.93
    
    
    
    
    1.81
    
    
    
    
    27.23
    
    
    
    
    1.53
    
    
    
    
    5,719
    
    
    
    
    1.3990
    
    
    
    
    56
    
    
    
    
    0.46 - 5.1
    
    
    
    
    1.6
    
    
    
    
    3.85
    
    
    
    
    1.59
    
    
    
    
    23.94
    
    
    
    
    1.60
    
    
    
    
    6,076
    
    
    
    
    1.4980
    
    
    
    
    77
    
    
    
    
    1 - 27.9
    
    
    
    
    8.5
    
    
    
    
    3.79
    
    
    
    
    1.50
    
    
    
    
    20.90
    
    
    
    
    1.57
    
    
    
    
    6,291
    
    
    
    
    2.5970
    
    
    
    
    68
    
    
    
    
    0.6 - 9.18
    
    
    
    
    3.2
    
    
    
    
    4.43
    
    
    
    
    1.43
    
    
    
    
    19.02
    
    
    
    
    1.31
    
    
    
    
    6,488
    
    
    
    
    2.4960
    
    
    
    
    65
    
    
    
    
    0.6 - 6.8
    
    
    
    
    2.2
    
    
    
    
    4.09
    
    
    
    
    1.36
    
    
    
    
    24.96
    
    
    
    
    1.32
    
    
    
    
    5,955
    
    
    
    
    1.9950
    
    
    
    
    67
    
    
    
    
    0.46 - 11.7
    
    
    
    
    1.7
    
    
    
    
    3.77
    
    
    
    
    1.36
    
    
    
    
    23.65
    
    
    
    
    1.30
    
    
    
    
    6,115
    
    
    
    
    2.8942
    
    
    
    
    43
    
    
    
    
    0.28 - 5.16
    
    
    
    
    1.5
    
    
    
    
    4.00
    
    
    
    
    1.38
    
    
    
    
    27.47
    
    
    
    
    1.23
    
    
    
    
    5,550
    
    
    
    
    2.4940
    
    
    
    
    88
    
    
    
    
    2.1 - 31
    
    
    
    
    13
    
    
    
    
    3.77
    
    
    
    
    1.25
    
    
    
    
    14.64
    
    
    
    
    1.40
    
    
    
    
    6,838
    
    
    
    
    3.09
    
    
    
    
    75
    
    
    
    
    0.7 - 7
    
    
    
    
    2.3
    
    
    
    
    3.33
    
    
    
    
    1.04
    
    
    
    
    28.14
    
    
    
    
    1.22
    
    
    
    
    5,721
    
    
    
    
    1.88-Series
    
    
    
    811
    
    
    
    
    25
    
    
    
    
    0.5 - 4.4
    
    
    
    
    1.9
    
    
    
    
    3.41
    
    
    
    
    1.54
    
    
    
    
    23.53
    
    
    
    
    1.35
    
    
    
    
    6,215
    
    
    
    
    1.8810
    
    
    
    
    84
    
    
    
    
    0.16 - 17.6
    
    
    
    
    4.6
    
    
    
    
    3.34
    
    
    
    
    1.10
    
    
    
    
    25.83
    
    
    
    
    1.24
    
    
    
    
    5,927
    
    
    
    
    2.18
    
    
    
    
    44
    
    
    
    
    0.34 - 12
    
    
    
    
    2.2
    
    
    
    
    2.93
    
    
    
    
    1.07
    
    
    
    
    25.39
    
    
    
    
    1.16
    
    
    
    
    5,916
    
    
    
    
    1.35-Series
    
    
    
    5
    
    
    
    
    47
    
    
    
    
    1.38 - 134.24
    
    
    
    
    51.5
    
    
    
    
    3.83
    
    
    
    
    1.26
    
    
    
    
    10.32
    
    
    
    
    0.77
    
    
    
    
    7,256
    
    
    
    
    3.05B
    
    
    
    
    12
    
    
    
    
    1.26 - 14.7
    
    
    
    
    6.4
    
    
    
    
    2.60
    
    
    
    
    1.00
    
    
    
    
    14.61
    
    
    
    
    0.55
    
    
    
    
    6,915
    
    
    
    
    3.15L
    
    
    
    
    15
    
    
    
    
    3.56 - 141.24
    
    
    
    
    43.1
    
    
    
    
    2.44
    
    
    
    
    0.81
    
    
    
    
    9.57
    
    
    
    
    0.80
    
    
    
    
    7,219
    
    
    
    
    3.9
  Mineral Resource Estimates
 Approach




---



##### 



57 Criteria Used to Define Assurance of Existence for Coals in Complex Geology Type
 Criteria
    
    
    Assurance of Existence CategoryMeasured
    
    
    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 (1)
 Resources at Nariin SukhaitMeasured
    
    
    Indicated
    
    
    InferredASTM Coal
    
    
    (million
    
    
    (million
    
    
    (millionResource Area
    
    
    Rank
    
    
    tonnes)
    
    
    tonnes)
    
    
    tonnes)South-East Field
    
    

hvB to hvA
    
    
    
    49,752,000
    
    
    
    
    15,987,000
    
    
    
    
    6,502,000West Field
    
    

hvB to hvA
    
    
    
    55,144,000
    
    
    
    
    28,698,000
    
    
    
    
    22,601,000Total
    
    
    
    
    
    
    
    
    149,580,000
    
    
    
    
    29,103,000
 Notes:(1)
    
    Mineral resources are not mineral reserves until they have demonstrated economic
viability based on a feasibility or pre-feasibility study. Mine Planning
  Current Exploration
 Nariin Sukhait Underground
  
 Other Coal Projects
 Tsagaan Tolgoi Project
 2




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##### 



58      Tsagaan Tolgoi Seam Quality
 As-Received BasisSeam
    
    
    Moisture %
    
    
    Ash %
    
    
    Sulfur %
    
    
    Kcal/Kg.
    
    
    Ave. Thickness5
    
    
    
    12.56
    
    
    
    
    15.21
    
    
    
    
    0.53
    
    
    
    
    5,545
    
    
    
    
    5.644U
    
    
    
    12.97
    
    
    
    
    13.70
    
    
    
    
    0.58
    
    
    
    
    5,746
    
    
    
    
    6.314L
    
    
    
    13.10
    
    
    
    
    9.48
    
    
    
    
    0.75
    
    
    
    
    6,096
    
    
    
    
    4.92




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##### 



59 As-Received BasisSeam
    
    
    Moisture %
    
    
    Ash %
    
    
    Sulfur %
    
    
    Kcal/Kg.
    
    
    Ave. Thickness3
    
    
    
    17.55
    
    
    
    
    16.24
    
    
    
    
    0.61
    
    
    
    
    5,145
    
    
    
    
    5.771U
    
    
    
    9.24
    
    
    
    
    29.04
    
    
    
    
    0.65
    
    
    
    
    4,798
    
    
    
    
    12.741L
    
    
    
    9.22
    
    
    
    
    32.80
    
    
    
    
    0.65
    
    
    
    
    4,440
    
    
    
    
    16.39TOTAL
    
    
    
    10.55
    
    
    
    
    24.75
    
    
    
    
    0.62
    
    
    
    
    4,785
    Tavan Tolgoi Area
    South Gobi Greenfields Exploration




---



##### 



60  
 Other Projects
 
 Mongolia
     2




---



##### 



61 2
 
 Kazakhstan
    2




---



##### 



62      
 Australia
 2 2 2




---



##### 



63 Copper-Gold-Uranium
   Other Prospects




---



##### 



64 
 China
  2
  
 Other Business Matters
 
 Myanmar Trust Arrangements




---



##### 



65     
 Equity Holdings
  66




---



##### 



ValueCompany
    
    
    Number of Shares
    
    
    (US$)Jinshan Gold Mines Inc.
    
    
    
    67,250,060
    
    
    
    
    88,251,644Entrée Gold Inc.
    
    
    
    10,435,489
    
    
    
    
    16,200,562Asia Now Resources Corp.
    
    
    
    969,036
    
    
    
    
    203,631Asia Gold Corp.
    
    
    
    7,469,201
    
    
    
    
    12,940,892Intec Limited
    
    
    
    34,312,366
    
    
    
    
    7,034,035
  
 Employees
  
 DIVIDENDS
 Business Corporations Act
 
 DESCRIPTION OF CAPITAL STRUCTURE
 Business Corporations Ac
 Common Shares
 Business Corporations Act




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##### 



67 Business Corporations Act
 Preferred Shares
   
 MARKET FOR SECURITIES
    PERIOD
    
    
    HIGH
    
    
    LOW
    
    
    VOLUMEJanuary 2006
    
    
    $
    9.98
    
    
    
    $
    8.35
    
    
    
    
    29,479,462February 2006
    
    
    $
    9.62
    
    
    
    $
    8.52
    
    
    
    
    16,676,479March 2006
    
    
    $
    11.22
    
    
    
    $
    8.56
    
    
    
    
    36,074,791April 2006
    
    
    $
    12.00
    
    
    
    $
    10.25
    
    
    
    
    19,209,581




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##### 



68 PERIOD
    
    
    HIGH
    
    
    LOW
    
    
    VOLUMEMay 2006
    
    
    $
    11.05
    
    
    
    $
    7.01
    
    
    
    
    47,982,483June 2006
    
    
    $
    8.07
    
    
    
    $
    6.51
    
    
    
    
    18,733,470July 2006
    
    
    $
    7.75
    
    
    
    $
    6.30
    
    
    
    
    12,413,699August 2006
    
    
    $
    7.21
    
    
    
    $
    6.45
    
    
    
    
    30,822,096September 2006
    
    
    $
    7.71
    
    
    
    $
    6.75
    
    
    
    
    30,327,496October 2006
    
    
    $
    13.09
    
    
    
    $
    6.37
    
    
    
    
    76,442,406November 2006
    
    
    $
    12.46
    
    
    
    $
    10.00
    
    
    
    
    29,915,950December 2006
    
    
    $
    13.18
    
    
    
    $
    10.76
    
    
    
    
    21,534,978
 
 DIRECTORS AND OFFICERS
  Name and Municipality of
    
    
    
    Principal OccupationResidence
    
    Position with Corporation
    
    During Past Five YearsROBERT M. FRIEDLAND
Singapore
    
    Chairman and Director
(Director since March 1994)
    
    Chairman of the Corporation (March 1994 to
present); Chief Executive Officer of the
Corporation (March 1994 to May 2006); Chairman
and President, Ivanhoe Capital Corporation (a
venture capital company) (1988 to present)PETER G. MEREDITH
B.C., Canada
    
    Deputy Chairman and Director
(Director since March 2005)
    
    Deputy Chairman of the Corporation (May 2006 to
present); Chief Financial Officer of the
Corporation (May 2004 to May 2006); Chief
Financial Officer of Ivanhoe Capital Corporation
(a venture capital company) (1996 to present)JOHN MACKEN
Massachusetts, USA
    
    Director, President and Chief
Executive Officer
(Director since January 2004)
    
    Chief Executive Officer of the Corporation (May
2006 to present); President of the Corporation
(January 2004 to present); Consultant (2000 to
January 2004); Senior Vice President of Freeport
McMoran Copper & Gold (a mining company) (1996 to
2000)




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##### 



69 Name and Municipality of
    
    
    
    Principal OccupationResidence
    
    Position with Corporation
    
    During Past Five YearsDAVID HUBERMAN
B.C., Canada
    
    Director (lead director) (Director
since September 2003)
    
    President, Coda Consulting Corp. (business
consulting firm) (1993 to present)R. EDWARD FLOOD
Idaho, USA
    
    Director
(Director since March 1994)
    
    Managing Director, Investment Banking, Haywood
Securities (UK) Limited (investment dealer)
(March 2007 to present); Deputy Chairman of the
Corporation (May 1999 to February 2007); Senior
Mining Analyst, Haywood Securities Inc.
(investment dealer) (May 1999 to November 2001)JOHN WEATHERALL
Ontario, Canada
    
    Director
(Director since June 1996)
    
    President of Scarthingmoor Assets Management Inc.
(an asset management company) (April 1996 to
present)KJELD THYGESEN
England
    
    Director
(Director since February 2001)
    
    Managing Director, Lion Resources Management
(investment firm and fund manager) (May 1989 to
present)HON. ROBERT HANSON
England
    
    Director
(Director since February 2001)
    
    Chairman, Hanson Capital Limited (investment and
finance company) (February 1998 to present);
Chairman, Hanson Transport Group (May 1990 to
present); Hanson Westhouse (City of London
merchant bank) (2006 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, China-Canada Business Council
(July 2001 to present); Canadian Ambassador to
China, Mongolia and Democratic Republic of Korea
(April 1996 to July 2001)DAVID KORBIN
B.C., Canada
    
    Director
(Director since May 2006)
    
    Independent Management and Financial Consultant
(May 1998 to present)TOM ALBANESE
England
    
    Director
(Director since November 2006)
    
    Director Group Resources, Rio Tinto (a mining
company) (July 2006 to present); Chief Executive
and head of Exploration of the Rio Tinto Copper
group (a mining company) (May 2004 to present)




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##### 



70 Name and Municipality of
    
    
    
    Principal OccupationResidence
    
    Position with Corporation
    
    During Past Five YearsTONY GIARDINI
B.C., Canada
    
    Chief Financial Officer
    
    Chief Financial Officer of the Corporation (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); Director,
Treasury and Operations, Placer Dome Inc. (May
2000 to October 2002)GENE WUSATY 
Alberta, Canada
    
    President, Coal Division
    
    President of the Corporations Coal Division
(August 2006 to present); Vice President of
Operations and Chief Operating Officer, Grande
Cache Coal Corp. (a mining company) (2004 to
September 2005); Mining Manager, Elk Valley Coal
Corp. (a mining company) (2003); Mine Manager and
Project Manager, Fording Coal Limited (a mining
company) (1989 to 2002)DOUGLAS KIRWIN
Queensland, Australia
    
    Executive Vice-President,
Exploration
    
    Executive Vice-President, Exploration of the
Corporation (September 1995 to present)STEVEN GARCIA
North Carolina, USA
    
    Executive Vice President
    
    Executive Vice President of the Corporation
(October 2005 to present); Project Director of
the Corporation (May 2005 to present); CEO Chamoa
Farm, Inc. (a wholesale landscaping and nursery
company) (2001 to present)JAY GOW
B.C., Canada
    
    Vice President, Marketing
    
    Vice President, Marketing of the Corporation (May
2004 to present); Marketing Manager, Copper &
Molybdenum, Compania Minera Antamina S.A. (a
mining company) (January 2001 to December 2003)PIERRE MASSE
B.C., Canada
    
    Vice President and Treasurer
    
    Vice President and Treasurer of the Corporation
(May 2004 to present); Chief Financial Officer of
the Corporation (November 2001 to May 2004);
Controller of the Corporation (October 1998 to
November 2001)




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##### 



71 Name and Municipality of
    
    
    
    Principal OccupationResidence
    
    Position with Corporation
    
    During Past Five YearsBEVERLY A. BARTLETT
B.C., Canada
    
    Vice President and Corporate
Secretary
    
    Vice President of the Corporation, Asia Gold and
Ivanhoe Energy Inc. (May 2006 to present);
Corporate Secretary of the Corporation (June 2001
to present); Corporate Secretary, Asia Gold
(August 2003 to present); Corporate Secretary,
Jinshan Gold Mines Inc. (May 2003 to present);
Corporate Secretary, Ivanhoe Energy Inc. (oil and
gas company) (June 2001 to present);DAVID WOODALL
Western Australia, Australia
    
    President, Gold Division
    
    President, Gold Division of the Corporation
(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)
  Shareholdings of Directors and Senior Officers
  Committees of the Board
  Conflicts of Interest




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##### 



72   Audit Committee Information
  
 INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
    Robert FriedlandCorporation Name
    
    Ownership InterestIvanhoe Energy Inc.
    
    
    20.24
    %Ivanhoe Capital Corporation
    
    
    100
    %Ivanhoe Nickel & Platinum Ltd.
    
    
    50
    %Jinshan Gold Mines Inc.
    
    
    (1)Asia Gold Corp.
    
    
    (1)
 
 (1)
    
    Mr. Friedland owns 27.03% of the Common Shares of the Corporation, which
owns 46.26 % of the common shares of Jinshan and 44.5% of the common shares of Asia Gold as at
December 31, 2006. 
 TRANSFER AGENTS AND REGISTRARS




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##### 



73 
 MATERIAL CONTRACTS
   1.
    
    Equity Participation and Earn-in Agreement dated October 15, 2004 between IVN and Entrée Gold
Inc., as amended November 9, 2004. See GENERAL DEVELOPMENT OF THE BUSINESS  Three Year
History  2004 for further details.
 2.
    
    Coal Reorganization Agreement dated July 7, 2006 among IVN, IMMI, Ivanhoe Coal Ltd. (now
called Ivanhoe Resources Ltd.), Ivanhoe Mongolia Coal LLC, Asia Gold and ASG Resources Ltd.
In conjunction with this transaction, IVN and Asia Gold also entered into an Interim Funding
Agreement dated April 25, 2006 and an Acquisition Agreement dated July 7, 2006. See GENERAL
DEVELOPMENT OF THE BUSINESS  Three Year History  2006 for further details.
 3.
    
    Head Agreement dated February 4, 2005 among IVN, Stemcor Pellets AG, Stemcor Holdings Ltd.
and Dominant Holdings AG, setting forth the terms and conditions of the sale of the Savage
River Project.
 4.
    
    An Underwriting Agreement dated April 6, 2006 among IVN, GMP Securities Ltd. and HSBC
Securities (Canada) Inc. Pursuant to this agreement, a syndicate of Canadian Underwriters,
following the exercise of an over-allotment option, bought 18,400,000 common shares at a price
of Cdn.$10.28 per share for gross proceeds of Cdn.$189,152,000.
 5.
    
    Private Placement Agreement dated October 18, 2006 as amended as of November 16, 2006 between
IVN and Rio Tinto International Holdings Limited. See GENERAL DEVELOPMENT OF THE BUSINESS -
Three Year History  2006 for further details.
 
 INTERESTS OF EXPERTS
 
  
    
    GRD Minproc for the Oyu Tolgoi Project in the Oyu Tolgoi Technical Report; and
    
    Norwest Corporation for the reporting of resources on the Nariin Sukhait Project in
the Nariin Sukhait Technical Report.




---



##### 



74 
 ADDITIONAL INFORMATION
  www.sedar.com




---



##### 



75 
 SCHEDULE A
 Audit Committee Information
 Composition of Audit Committee
  Relevant Education and Experience
 John Weatherall
  Markus Faber
  Kjeld Thygesen
  David Korbin




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##### 



76 Audit Fees
  (Canadian $ in 000s)
    
    2006
    
    2005Audit Fees (a)
    
    $
    1,588
    
    
    $
    936Audit Related Fees (b)
    
    $
    246
    
    
    $
    208Tax Fees (c)
    
    $
    700
    
    
    $
    200All Other Fees (d)
    
    
    
    
    
    
    Total
    
    $
    2,534
    
    
    $
    1,343
 (a)
    
    Fees for audit services billed or expected to be billed relating to fiscal 2006 and 2005
consisted of:
 
    
    audit of the Companys annual statutory financial statements;
    
    reviews of the Companys quarterly financial statements; and
    
    comfort letters, consents, and other services related to SEC and Canadian securities
regulatory authorities matters.
  (b)
    
    Fees for audit-related services provided during fiscal 2006 and 2005 consisted of financial
accounting and reporting consultations and audit of annual statutory financial statements of
the Companys subsidiaries.
 (c)
    
    Fees for tax services provided during fiscal 2006 and 2005 consisted of income tax
compliance, and tax planning and advice relating to transactions and proposed transactions of
the Company and its subsidiaries.
 (d)
    
    The Corporation did not incur fees for products and services provided by its principal
accountant during fiscal 2006 and 2005 not disclosed in subsections (a), (b) or (c) above.
 Pre-Approval Policies and Procedures




---



##### 



77




---



##### 



78 
 I. Purpose
    II. Organization
     III. Meetings




---



##### 



79     IV. Authority and Responsibilities
   (a)
    
    Auditors
 1.
    
    Recommend to the Board the independent auditors to be nominated for appointment as Auditors
of IVN at IVN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 Auditors, 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 Auditors audit plan and discuss the Auditors scope, staffing, materiality, and
general audit approach.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 IVN;(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
IVN, 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




---



##### 



80 
 (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 IVN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 Information11.
    
    Review and discuss with management, the financial and accounting officer(s) and the Auditors,
IVN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 IVNs audited financial statements be included in IVN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,
IVNs interim financial statements, including managements discussion and analysis, and the
Auditors review of interim financial statements, prior to filing or distribution of such
statements.13.
    
    Review any earnings press releases of IVN before IVN publicly discloses this information.14.
    
    Be satisfied that adequate procedures are in place for the review of IVNs disclosure of
financial information and extracted or derived from IVNs financial statements and
periodically assess the adequacy of these procedures.15.
    
    Discuss with the Auditors 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, IVNs significant auditing and accounting
principles and practices;(b)
    
    the management letter provided by the Auditors and IVNs response to that letter; and




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##### 



81 
 (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 IVNs financial statements, including any significant changes in IVN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
IVN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 IVN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 IVNs accounting principles and financial disclosure
practices as applied in its financial reporting and (b) the completeness and accuracy of IVNs
financial statements.21.
    
    Consider and approve, if appropriate, significant changes to IVN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.22.
    
    Review and discuss with management, the Auditors and IVNs independent counsel, as
appropriate, any legal, regulatory or compliance matters that could have a significant impact
on IVN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 IVN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 IVN.24.
    
    Review the principal control risks to the business of IVN, 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




---



##### 



82 
 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 IVN 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 IVNs major risk exposures and the steps management has
taken to monitor, control and manage such exposures, including IVN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 IVN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 systems30.
    
    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 IVNs internal
control structure and procedures designed to insure compliance with laws and regulations, and
discuss the responsibilities, budget and staffing needs of IVNs financial and accounting
group.32.
    
    Establish procedures for (a) the receipt, retention and treatment of complaints received by
IVN regarding accounting, internal accounting controls or auditing matters and (b) the
confidential, anonymous submission by employees of IVN of concerns regarding questionable
accounting or auditing matters.33.
    
    Review the internal control reports prepared by management, including managements assessment
of the effectiveness of IVN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.




---



##### 



83 
 37.
    
    Review and approve (a) any change or waiver in IVN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
IVNs Auditors.39.
    
    Review and reassess the duties and responsibilities set out in this Charter annually and
recommend to the Nominating and Corporate Governance 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, IVN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