Rio Tinto's Ownership of Ivanhoe Mines Rises to 34.9%

Robert Friedland, Executive Chairman of Ivanhoe Mines IVNIVN, and John Macken, President and Chief Executive Officer, announced today that Ivanhoe Mines has converted Rio Tinto's maturing US$350 million convertible credit facility, plus accrued interest of $50.8 million, into approximately 40.1 million common shares of Ivanhoe Mines, increasing Rio Tinto's ownership in Ivanhoe Mines from 29.6% to 34.9%. The convertible credit facility was put in place in September 2007 to help maintain mine development activities at Oyu Tolgoi while Ivanhoe and Rio Tinto continued negotiations with the Mongolian Government that resulted in a long-term Investment Agreement for the Oyu Tolgoi Project in 2009. The interest rate on the convertible credit facility was LIBOR plus 3.3% and the conversion price into Ivanhoe Mines shares was set at US$10.00 per share. As part of the credit facility transaction, Rio Tinto also received share-purchase warrants exercisable to purchase up to 35 million common shares of Ivanhoe Mines at a price of US$10.00 per share for a period of five years. These warrants expire in October 2012. Rio Tinto now has invested approximately US$1.73 billion in Ivanhoe Mines. Rio Tinto holds additional rights to subscribe for common shares from Ivanhoe Mines (see details in accompanying table). Mr. Macken said that Rio Tinto's past and potential future investments in Ivanhoe total approximately US$2.5 billion, comprised of the 2006 private-placement agreement and other financing transactions negotiated in 2007, 2008 and 2010.