Erdene Continues to Outline Ulaan Feeder Zone, Intersects 27 Metres of 3.5 G/T GOLD, Including 2 Metres of 24.9 G/T GOLD
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ERDENE CONTINUES TO OUTLINE ULAAN FEEDER ZONE,
INTERSECTS 27 METRES OF 3.5 G/T GOLD, INCLUDING 2 METRES
OF 24.9 G/T GOLD
Press Release
Halifax, Nova Scotia
2022.07.26
Erdene Resource Development Corporation (TSX: ERD | MSE: ERDN) (“Erdene” or the
“Company”) is pleased to announce final results from the Q2 2022 drill program at Ulaan
Southeast (“Ulaan SE”), located 300 metres west of the construction ready Bayan Khundii
Gold Project in southwest Mongolia. This program expanded known mineralization at the
Ulaan SE discovery to the west and at depth, and intersected an interpreted high-grade,
gold bearing “feeder” structure. Follow-up exploration at Ulaan SE is currently underway.
Highlights
• UDH-53 returned high-grade mineralization within a projected feeder zone, including
2 metres of 24.9 g/t gold within 27 metres of 3.47 g/t gold
• UDH-52, 60 metres SSE of UDH-53, intersected a wide zone of mineralization – 189
metres averaging 0.8 g/t gold
• Mineralization at Ulaan SE has been traced over a 200 metre strike, to a depth of 450
metres, that remains open to the west and at depth; highlights of Q2 drilling include:
o UDH-35 included the highest average grade intersection to date at Ulaan SE
▪ Intersected 23 metres of 13.7 g/t gold within 41 metres of 8.1 g/t gold,
beginning 187 metres downhole
o UDH-21, including the hole extension, returned one of the thickest gold zones
in the Khundii District
▪ Intersected 335 metres of 1.1 g/t gold, beginning 115 metres downhole,
ending in mineralization
▪ Includes 27 metres of 8.7 g/t gold, within 77 metres of 3.2 g/t gold
o UDH-36 intersected 179 metres of 1.2 g/t gold, beginning 72 metres downhole
▪ Includes several one-metre, high-grade intersections, ranging from 10-
33 g/t gold, and ending in mineralization at 350 metres
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Quotes from the Company
“Ulaan drilling has returned very high grade zones in the feeder structure as well as
exceptionally thick zones of mineralization, exceeding 300 metres, which remain open, in
the core of the discovery,” said Peter Akerley, Erdene’s President and CEO. “This newest
Khundii District discovery is interpreted as the western extension of the Bayan Khundii
deposit, demonstrating the resource expansion potential from deeper exploration in the
District.”
“In the past week, we launched a follow-up exploration program. The outcome of this
program, as well as the results from the recently completed regional reverse-circulation
(“RC”) program, will focus our exploration work for the balance of 2022 ,” continued Mr.
Akerley. “We are confident that we are well on our way to achieving our two million ounce
gold equivalent resource target by the end of the year.”
Summary of Drill Results
The primary objectives of the Q2 2022 Ulaan SE drilling program were to test interpreted
high-grade feeder zones along bounding or intersecting structures in the northern portion
of the Ulaan SE discovery, and to test mineralization at depth.
Six new holes, as well as five hole-extensions, totaling 2,463.7 metres, were completed
as part of the Q2 2022 Ulaan SE drilling program. Results are summarized below in Table
1. Results for the final two holes in the program, UDH-52 and UDH-53, are newly reported;
all other results were reported on June 6, 2022.
The Q2 2022 program at Ulaan SE confirmed a zone of high -grade mineraliza tion
interpreted to be associated with intersecting or bounding structures and possibly a feeder
zone. Drill hole UDH-35 returned the highest average grade interval intersection to date
at Ulaan SE, with 41 metres of 8.1 g/t gold starting 187 metres downhole. Drill hole UDH-
36 extended high-grade mineralization further west from the discovery area, intersecting
one of the broadest zones of mineralization to date in Erdene’s Khundii Gold District. Hole
UDH-53 was drilled to confirm extension of the feeder z one at depth and intersected 27
metres of 3.47 g/t gold, including three one-metre intervals greater than 10 g/t gold (up to
35.5 g/t gold), and ended in mineralization.
Step-out drill holes and hole extensions continue to expand the area o f known
mineralization, which remains open to the west and at depth. Drillhole UDH-37 intersected
the targeted gold mineralized tuffaceous host lithology, broadening the potential for gold
mineralization as exploration progresses westward further into the core of the Ulaan
license area. UDH-38 complimented the results of UDH-37, extending gold mineralization
westward; however, this drillhole also indicates shallower gold mineralization, with gold
mineralization beginning 42 metres down hole.
Hole extensions (an additional 100 to 200 metres, to total depths of 350 to 450 metres )
demonstrated that gold mineralization extends over 400 metres vertically. Mineralization
remains open at de pth with two of the holes extended to 450 metres end ing in
mineralization.
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Table 1: Ulaan Q2 2022 Drilling Highlights
(Intervals averaging over 0.30 g/t gold)
Hole ID From To Interval (1) Au g/t
Newly Reported Drill Holes
UDH-52 86 275(2) 189 0.80
UDH-53 248 337(2) 89 1.40
Incl 248 275 27 3.47
Incl 248 250 2 24.90(5)
Incl 295 296 1 11.88
Previously Reported Q2 – 2022 Drill Holes
UDH-35 107 116 9 0.49
And 176 178 2 0.46
And 187 228 41 8.10
Incl 188 211 23 13.73
Incl 188 189 1 10.87
Incl 197 198 1 44.40
Incl 208 211 3 68.32
Incl 208 209 1 108.12
And 235 238 3 0.36
And 246 251(2) 5 0.34
UDH-36 2 4 2 0.51
And 72 251(2) 179 1.23
Incl 106 107 1 15.52
Incl 142 143 1 14.36
Incl 146 147 1 10.84
Incl 227 228 1 33.43
UDH-37 64 68 4 0.44
And 168 272 104 0.31
Incl 202 246 44 0.51
UDH-38 42 68 26 0.30
And 193 262 69 0.48
And 346 348 2 0.56
Hole Extensions
UDH-08 20 22 2 0.44(3)
And 202 206 4 0.37
UDH-12 310 314 4 0.36
And 324 328 4 0.46
And 338 340 2 0.58
UDH-17 287 289 2 1.71(3)
And 314 368 54 1.55(4)
Incl 348 350.3 2.3 21.57(3)
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Hole ID From To Interval (1) Au g/t
And 412 422 10 0.33
And 425 426 1 0.39
And 432 434 2 0.30
UDH-21 115 450.3(2) 335.3 1.10(4)
Incl 115 192 77 3.19(3)
Incl 131 158 27 8.74(3)
Incl 139 140 1 156.54(3)
Incl 155 156 1 20.98(3)
Incl 209 280 71 0.81(3)
Incl 222 230 8 1.92(3)
Incl 257 271 14 2.79(3)
Incl 304 318 14 0.34(3)
Incl 342 450.3(2) 108.3 0.53(4)
Incl 417 450.3(2) 33.3 0.91
UDH-28 282 291 9 0.47(3)
And 306 356 50 0.47(4)
And 370 384 14 0.37
And 394 450(2) 56 0.34
1. Reported intervals in this release are downhole apparent widths. Continued exploration is required to confirm anisotropy of
mineralization and true thicknesses
2. End of hole
3. Previously reported interval (2021)
4. Extended interval
5. Included two, one-metre intervals, both greater than 10 g/t gold (14.3 and 35.5 g/t gold)
Next Steps
The results to date demonstrate a broad and thick zone of mineralization over a vertical
depth in excess of 400 metres, that remains open at depth and to the west. Analysis of
multi-element geochemical data, complimented by downhole magnetic susceptibility
readings, are introducing correlations previously unrecognized at Ulaan SE. These
datasets indicate that i ncreased potassium concentrations ( after pervasive adularia-
Kspar alteration) in conjunction with low magnetic susce ptibility readings, are strongly
correlated with the targeted gold bearing tuffaceous host package. 3D modelling of these
combined variables will serve as important target vectoring tools for future drilling at Ulaan
SE. A follow -up drilling program has be en designed to further test continuation of
mineralization to the west and at depth, including further tracing of the high -grade
mineralization identified to date which has been interpreted as a potential structurally
controlled feeder zone.
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Ulaan SE Overview
The Ulaan SE gold target is a blind-top discovery identified in Q3 2021. The prospect is
characterized by hundreds of metres of gold mineralization (up to 354 metres
continuously in a single drill hole ) over an area 200 metres by 250 metres. Gold
mineralization begins approximately 80 metres from surface and remains open along
strike to the west/northwest and at depth. Intervals include 152 metres of 1.7 g/t gold in
UDH-22 (from 85 metres) and 77 metres of 3.2 g/t gold in UDH-21 (from 115 metres), as
well as the more recent results noted in this release. Similar to the B ayan Khundii gold
deposit, approximately 300 metres east, the mineralizing event is characterized by
exceptionally high -grade quartz ± hematite and adularia veins and stockwork zones
enveloped by the same gold bearing, silicified, white-mica altered lapilli tuff sequence.
The southern portion of the Ulaan license has areas of anomalous gold -in-soil over an
area 3.5 kilometres by 1 kilometre. The underlying geology and alteration appears to be
analogous to the gold mineralization at Ulaan Southeast and Bayan Khundii, namely
tuffaceous units with white mica and silica alteration. A series of holes have been drilled
to test high priority targets , for which the re sults are pending and expected in early Q3
2022.
Khundii Minerals District
Erdene’s deposits are in the Trans Altai Terrane, within the Central Asian Orogenic Belt,
host to some of the world’s largest gold and copper -gold deposits. The Company has
been the leader in exploration in so uthwest Mongolia over the past decade and is
responsible for the discovery of the Khundii Gold District comprised of multiple high-grade
gold and base metal prospects, one of which is currently being developed, the 100% -
owned Bayan Khundii Gold Project, an d another which is being considered for
development, the 100% -owned Altan Nar Project. In 2021, the Company identified two
new significant gold prospects, Dark Horse and Ulaan Southeast.
The Bayan Khundii Gold Resource 1 includes 585,100 ounces of 2.19 g/t gold Measured
and Indicated (“M&I”) 2 and 35,900 ounces of Inferred resources at 2.18 g/t gold. Within
the M&I resource, a Proven and Probable open -pit reserve totals 409,000 ounces at 3.7
g/t gold3 (press release here), providing significant potential for reserves growth with the
development of the remaining M&I and Inferred resources1.
In July 2020, Erdene announced the results of an independent Feasibility Study for the
Bayan Khundii Gold Project (press release here). The Feasibility Study results include an
after-tax Net Present Value at a 5% discount rate and a US$1,400/oz gold price of
1 For details of the Mineral Resources see Erdene’s Q2/2021 results press release, dated August 16, 2021, and the
Company’s Q2 2021 MD&A, available on the Company’s website or SEDAR.
2 M&I: 232,700 ounces of 2.39 g/t gold Measured and 352,400 ounces of 2.08 g/t gold Indicated
3 P&P: 165,000 ounces of 4.4 g/t gold Proven and 256,000 ounces of 3.4 g/t gold Probable; For details of the Mineral
Reserves see Khundii Gold Project NI 43 -101 Technical Report, Tetra Tech December 4, 201 9 available on the
Company’s website or SEDAR
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US$100 million and Internal Rate of Retur n (“IRR”) of 42%. The Feasibility Study
envisions an open pit mine at Bayan Khundii, producing an average of 63,500 oz gold per
year, for seven years, at a head grade of 3.71 g/t gold, utilizing a conventional carbon in
pulp processing plant. Production is expected to commence in 2023 based on the current
project schedule.
About Erdene
Erdene Resource Development Corp. is a Canada-based resource company focused on
the acquisition, exploration, and development of precio us and base metals in
underexplored and highly prospective Mongolia. The Company has interests in three
mining licenses a nd an exploration license in Southwest Mongolia, where exploration
success has led to the discovery and definition of the Khundii Gold District. Erdene
Resource Development Corp. is listed on the Toronto and the Mongolian stock exchanges.
Further informati on is available at www.erdene.com. Important information may be
disseminated exclusively via the website; investors should consult the site to access this
information.
Qualified Person and Sample Protocol
Peter Dalton, P.Geo. (Nova Scotia), Senior Geologist for Erdene, is the Qualified Person
as that term is defined in National Instrument 43-101 and has reviewed and approved the
technical information contained in this news release. All samples have been assayed at
SGS Laboratory in Ulaanbaatar, Mongolia. In addition to internal checks by SGS
Laboratory, the Company incorporates a QA/QC sample protoc ol utilizing prepared
standards and blanks. All samples undergo standard fire assay analysis for gold and ICP-
OES (Induct ively Coupled Plasma Optical Emission Spectroscopy) analysis for 33
additional elements. For samples that initially return a grade grea ter than 5 g/t gold,
additional screen-metallic gold analysis is carried out which provides a weighted average
gold grade from fire assay analysis of the entire +75 micron fraction and three 30 -gram
samples of the -75 micron fraction from a 500 gram sample.
Erdene’s drill core sampling protocol consisted of collection of samples over 1 or 2 metre
intervals (depending on the lithology and style of mineralization) over the entire length of
the drill hole, excluding minor post -mineral lithologies and un -mineralized granitoids.
Sample intervals were based on meterage, not geological controls, or mineralization. All
drill core was cut in half with a diamond saw, with half of the core placed in sample bags
and the remaining half securely retained in core boxes at Erdene’s Bayan Khundii
exploration camp. All samples were organized into batches of 30 including a commercially
prepared standard, blank and either a field duplicate, consisting of two quarter -core
intervals, or a laboratory duplicate. Sample batches were periodically shipped directly to
SGS in Ulaanbaatar via Erdene’s logistical contractor, Monrud Co. Ltd.
Reported intervals are apparent thicknesses, i.e. downhole widths. The current Ulaan drill
holes are all dipping at 85 degrees and oriented to intersec t SW dipping WNW trending
gold bearing veins. Additional study is required to confirm true widths. Reported grades
for intervals are weighted averages based on length of sampling intervals. No top cut has
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been applied; however, all intervals greater than 10 g/t gold and 100 g/t gold are reported
individually for clarity
Forward-Looking Statements
Certain information regarding Erdene contained herein may constitute forward -looking
statements within the meaning of applicable securities laws. Forward-looking statements
may include estimates, plans, expectations, opinions, forecasts, projections, guidance, or
other statements that are not statements of fact. Although Erdene believes that the
expectations reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to have been correct. Erdene ca utions that
actual performance will be affected by a number of factors, most of which are beyond its
control, and that future events and results may vary substa ntially from what Erdene
currently foresees. Factors that could cause actual results to differ m aterially from those
in forward-looking statements include the ability to obtain required third party approvals,
market prices, exploitation, and exploration re sults, continued availability of capital and
financing and general economic, market or business conditions. The forward -looking
statements are expressly qualified in their entirety by this cautionary statement. The
information contained herein is stated as of the current date and is subject to change after
that date. The Company does not assume the o bligation to revise or update these
forward-looking statements, except as may be required under applicable securities laws.
NO REGULATORY AUTHORITY HAS APPROVE D OR DISAPPROVED THE
CONTENTS OF THIS RELEASE
Erdene Contact Information
Peter C. Akerley, President and CEO, or
Robert Jenkins, CFO
Phone: (902) 423-6419
Email: [email protected]
Twitter: https://twitter.com/ErdeneRes
Facebook: https://www.facebook.com/ErdeneResource
LinkedIn: https://www.linkedin.com/company/erdene-resource-development-corp-/
20 km
Landsat 8 True Colour
N
Shallow, High-Grade, Gold and Polymetallic Deposits and Prospects
Exploration License
Mining License
Prospect
Deposit
Au
Cu
Mo
Bayan Khundii Gold Deposit
Shovel ready high-grade,
open-pit gold project
Ulaan SE Gold Discovery
Blind top gold discovery
(July/21)
Dark Horse Gold Discovery
High-grade, near surface gold
discovery (Jan/21)
Gold polymetallic deposit
Target >1Moz of Au Eq>2g/t
Altan Nar Gold Deposit
Zuun Mod Moly & Copper Deposit
Largest, undeveloped, advanced stage
molybdenum-copper project in Asia
1
KHUNDII MINERALS DISTRICT – MULTI-MILLION OUNCE POTENTIAL
Four Gold Discoveries, Molybdenum Copper Deposit & Multiple High-Priority Targets