Erdene Drilling Intersects Multiple High-Grade Gold Zones Including Highest Grade Result to Date With 2,200 g/t Gold Over 1 Metre at Bayan Khundii Gold Project
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ERDENE RESOURCE DEVELOPMENT CORP.
Erdene Drilling Intersects Multiple High-Grade Gold Zones Including
Highest Grade Result to Date With 2,200 g/t Gold Over 1 Metre at Bayan
Khundii Gold Project
Halifax, Nova Scotia - January 10, 2018 - Erdene Resource Development Corp. (TSX:ERD)
("Erdene" or " Company") is pleased to report the highest -grade gold intersection encountered
to date at its 100% -owned Bayan Khundii Gold Project (“Bayan Khundii”) in southwest
Mongolia.
“We are excited by this intersection, not only because of the ultra high -grade nature but by the
continuity that continues to be demonstrated within multiple, high -grade gold domains within a
broad lower-grade halo throughout this 1.4 kilometre long system,” said Peter Akerley, Erdene’s
President and CEO. “The continuity of these high -grade gold bearing veins , that extend from
surface and up to 150 metres vertically, provides an excellent base for advancing the project.
These results clearly demonstrate the continued exploration upside potential of this relatively
new gold discovery. They also support further detailed exploration targeting gold bearing
structures not only within the Bayan Khundii deposit area but also within the larger district
which we are confident will lead to additional discoveries.”
HIGHLIGHTS
(see attached plan maps, cross-sections and drill core photograph for reference)
Drilling in the North Midfield Zone returns highest gold result to date, 2,200 g/t gold
(70.7 oz/t) and 948 g/t silver (30.5 oz/t) over 1 metre (BKD-231).
Drilling in the North Midfield Zone, 65 metres north of BKD-231, returns 22 metres of
8.3 g/t gold, within 36.5 metres of 5.6 g/t gold (BKD-232).
Drilling within the Midfield Zone returns 25 metres o f 5.8 g/t gold within a 127.5 metre
interval of 1.8 g/t gold (BKD-230).
Structural interpretation by Dr. Armelle Kloppenburg provides greater understanding o f
controls on gold mineralization at Bayan Khundii and improv es targeting of ultra high-
grade zones and district-scale targets.
Additional results pending for Altan Arrow and Altan Nar gold projects.
SUMMARY
The exploration program reported on herein was developed by the Erdene technical team in
conjunction with an independent expert’s review to identify high priority structural targets within
the Bayan Khundii project area. This included: testing the recently discovered North Midfield
Zone with more detailed, closer-spaced drilling and testing structural concepts and extensions at
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depth; testing the Midfield area for the presence of shallower zones of mineralization ; testing the
continuity of broad mineralized zones in the central portion of th e North Midfield target area;
and testing the southeast extension of the Striker Zone.
Six holes (BKD-229 to BKD-234), totalling 1,192 metres, were completed at Bayan Khundii in
November and are included in this update . Three holes were completed in the Midfield Zone
(BKD-229, 230, and 233), two holes were completed in the North Midfield Zone (BKD-231 and
232), and one hole was completed along the south east end of the Striker Zone (BKD -234).
Table 1 below includes drill result highlights of the se six holes, followed by a description of
results.
Table 1. Bayan Khundii drill highlights
Drill Hole From (m) To (m) Interval (m) (1) Gold (g/t)
BKD-229 3 8 5 2.39
and 22 30 8 0.61
and 56 156.7 100.7 0.74
incl 100 147 47 1.31
incl 113 114 1 14.4
and 133 147 14 2.41
incl 144 145 1 18.9
BKD-230 31 158.5 127.5 1.80
incl 73 98 25 5.84
incl 95 98 3 36.8
BKD-231 118 193 75 0.35
and 193 207 14 158.3
incl 193 194 1 2,200
and 207 230 23 0.34
BKD-232 90.5 127 36.5 5.62
incl 102 124 22 8.29
incl 102 112 10 11.7
incl 102 103 1 15.5
and 106 107 1 13.4
and 110 112 2 31.1
and 120 124 4 10.8
and 138.4 146 7.6 1.75
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Drill Hole From (m) To (m) Interval (m) (1) Gold (g/t)
BKD-233 26 33 7 1.43
and 38 45 7 0.43
and 65 66 1 2.01
and 72 78 6 4.12
incl 72 73 1 22.5
and 94 104 10 0.49
and 113 132 19 0.72
BKD-234 3 7 4 1.54
and 40 55 15 1.03
and 76 104 28 0.84
incl 79 93 14 1.19
(1) Reported intervals are not true width. At this time, there is insufficient data with respect to the shape of the
mineralized system to calculate true orientations in space. They represent drill intersection widths from holes drilled
at a dip of -45 to -85 degrees and oriented to the north-northeast. The Bayan Khundii mineralization is interpreted to
be moderately dipping (approximately 40 to 50 degrees to the southwest).
Two plan maps, two cross-sections, and a photograph of the high -grade intersection from hole
BKD-231 have been attached for reference.
DISCUSSION OF DRILL RESULTS
NORTH OF MIDFIELD ZONE
Two holes (BKD -231 and BKD -232) were completed in the N orth Midfield Zone to test the
down-dip extension of the high-grade gold intervals in this area.
Hole BKD -231 intersected one metre of 2,200 g/t gold and 9 48 g/t silver within a 14 metre
interval of 158 g/t gold at 193 metres depth (140 metres vertical depth). The mineralization was
hosted by multi-phase quartz-adularia-specularite veins and hematite breccia , with abundant
fine-grained visible gold (see attached photo of drill core ). The 14 metre interval is enveloped
by a 112 metre wide interval of gold mineralization starting at 118 metres depth, ranging from
0.1 to 2.8 g/t gold. This high -grade intersection confirms strong continuity down -dip from
earlier holes, including BKD-110, 30 metres north, which intersected 1 metre of 115 g/t gold and
1 metre of 108 g/t gold , and BKD-111, 30 metres northwest, which intersected 1 metre of 44 g/t
gold and 1 metre of 33 g/t gold . The discovery of this high -grade vein represents an important
new target area that will require additional, closer-spaced drilling in 2018.
Hole BKD-232 was completed approximately 65 metres north of BKD-231 and 100 metres north
of the Midfield Zone , within an area that previously had 80 -metre hole spacing and relatively
lower grade results . This hole returned 22 metres of 8.3 g/t gold, and includ ed multiple zones
grading over 10 g/t gold (see Table 1 above). The top of the mineralized interval was intersected
at 90.5 metres depth (74 metres vertical depth).
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MIDFIELD ZONE
Three holes were completed along the south and southeast end of the Midfi eld Zone (BKD-229,
230 and 233). Hole BKD-230, completed near the center of Midfield, intersected a continuo usly
mineralized 127 metre interval starting at 31 metres depth (24 metres vertical) that averaged 1.8
g/t gold, and included a 25 metre wide interval that averaged 5.8 g/t gold.
Two additional holes (BKD-229 and BKD -233) successfully intersected high -grade gold
mineralization, and in the case of BKD -233, although lower grade, expanded the southeast
boundary of the Midfield Zone which re mains open to the east (see attached plan map for drill
hole locations) while BKD-229 intersected gold mineralization at the shallowest levels to date.
STRUCTURAL INTERPRETATION
In Q4 -2017, Dr. Armelle Kloppenburg conducted a comprehensive structural study of the
Company’s gold projects in southwest Mongolia and the broader metals district. The results of
that study provide new insights into the Bayan Khundii gold project. Gold mineralizing events
are believed to be late Devonian – early Caboniferous and are interpreted to exploit dilational
structures in a belt -parallel extensional zone. At Bayan Khundii, northeast-trending extensional
faults have intersected a northwest-trending basement structure that is proposed to be a conduit
for gold-bearing fluids. In this area a relay ramp structure developed and promoted further local
faulting, fracturing and dilation to focus fluid flow, and veining for mineralization. In relation to
the specific high-grade domains at Bayan Khundii it is thought that the most prospective areas of
these structures would typically be in proximity to the intersection of the major, deep -seated
faults, and locally in the hanging wall, and at the ends of the bounding structures (fault tips or
extensional stepover s). These areas were the focus of limited drilling during the Q4 -2017
program but will be the focus of future drilling and of regional exploration along trend exploring
for similar structural environments. District-scale targets for gold mineralization are in areas
where the dilation, steepening or intersection with other major structures or more competent
units occurs.
2018 TECHNICAL PROGRAM
During Q1 -2018 the Company’s technical team will assess results of the 201 7 drill and
exploration programs to determine what additional drilling may be required prior to an
independent resource evaluation. Timing of the eventual resource studies for both Bayan
Khundii and the Company’s neighboring Altan Nar gold-polymetallic project will be influenced
by that determination, however, it is anticipated that the studies will be completed in 2018.
REGIONAL DISTRICT EXPLORATION
In addition to drilling at Bayan Khundii, the Company completed significant exploration work
during Q4 -2017 within the larger , gold district, including the evaluation of targets within the
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11.4 km long Bayan Khundii license. A particular focus was placed on the Altan Arrow (3.5 km
north of Bayan Khundii) and Khundii North (3.2 km northeast of Bayan Khundii) target areas,
and also on the Ulaan (immediately west of Bayan Khundii) and Altan Nar (16 km northwest of
Bayan Khundii) license areas.
The northeast-trending faults outlined above are part of a larger network of regional northeast
transverse faults that are present throughout the Khundii prospect area. The thoroughgoing
structure at Bayan Khundii can be traced 4.6 km nor theast to the untested Khundii North
prospect where areas of quartz stockwork, chalcedonic quartz with hematite breccia clasts have
returned rock sample results up to 22.7 g/t gold.
At Altan Arrow, detailed soil and rock chip sampling has returned highly anomalous gold assays,
with up to 27 g/t in rock chip s in an area south of the main northeast-trending Altan Ar row
structure. The Altan Arrow gold prospect area is also located at the intersection of proposed
major deep-seated structures.
A three-hole, 450 metre drill program was also completed at Altan Arrow as part of the Q4 -2017
drill program. Drilling included two holes designed to test coincident soil geochemical and
geophysical targets, and one hole was oriented to test a potential down -dip extension of high -
grade gold mineralization encountered in the 2016 reconnaissance drilling program at Altan
Arrow.
The Company also completed a three -hole, 450 metre drill program at the Altan Nar deposit as
part of the Q4-2017 drill program. Holes were oriented to test lateral and down -dip extensions of
gold-polymetallic mineralization within both the Discovery Zone and Maggie Zone.
Additional analytical results for Altan Nar and Altan Arrow are expected to be released by
February 2018.
BACKGROUND ON BAYAN KHUNDII GOLD PROJECT
In Q2 -2015, Erdene conducted an initial exploration program on the southern portion of the
Company’s 100% -owned Khundii exploration license in southwest Mongolia , including an
initial rock-chip sampling program which revealed multiple very high-grade surface quartz veins
that returned up to 4,380 g/t gold. Since that time, drilling has revealed the presence of very high
gold grades, with up to 2,200 g/t gold over 1 -metre intervals, within broad mineralized zones,
with up to 131 metres of 3.9 g/t gold, including 80 metres of 6.0 g/t gold. Since the first drill
hole in Q4 -2015, the Company has completed 234 diamond drill holes, totaling 38,072 metres.
In addition to drilling, t he Company has completed a comprehensive exploration program at
Bayan Khundii that has included: geological mapping; soil geochemical survey s; additional
surface rock chip sampling; a ground magnetic survey; gradient array and dipole -dipole induced
polarization surveys. In addition to this work, a series of detailed follow -up studies have also
been completed, predominantly on drill core and sur face outcrop, including: petrographic and
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mineralogical analyses; a fluid inclusion study; SEM gold composition analysis; Short -Wave
Infra-Red Analysis (SWIR); structural analysis; and overall petrogenetic analysis. Detailed
studies indicate the mineralize d zones can be characterized as low -sulphidation epithermal,
quartz-illite-adularia type mineralization.
In Q1-2016 and Q3 -2017, the Company co mpleted metallurgical test work on Bayan Khundii
master composites that indicated gravity concentration and cyanidation of the gravity tails yield
very good overall gold recoveries , with 91% to 99% gold recovery on a range of gold grades
from 0.7 g/t to 25.9 g/t gold.
The Bayan Khundii license has a 2% net smelter returns royalty (“NSR Royalty”) in favour of
Sandstorm Gold Ltd. with a buy-back option to reduce the NSR Royalty to 1%.
QUALIFIED PERSON AND SAMPLE PROTOCOL
Michael MacDonald, P.Geo. (Nova Scotia), Vice President Exploration 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, M ongolia. In addition to internal checks by SGS
Laboratory, the Company incorporates a QA/QC sample protocol utilizing prepared standards
and blanks.
Erdene’s sampling protocol for drill core consisted of collection of samples over 1 m etre 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 mineralizati on. 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 samples including a commercially prepared standard, blank,
and either a field duplicate, consisting of two ¼ core intervals, or a laboratory duplicate . Sample
batches were periodically shipped directly to SGS in Ulaanbaatar via Erdene’s logistical
contractor, Monrud Co. Ltd.
ABOUT ERDENE
Erdene Resource Development Corp. is a Canada -based resource company focused on the
acquisition, exploration, and development of base and precious metals in underexplored and
highly prospective Mongolia. The Company has interests in five exploration licenses and a
mining license in southwest Mongolia. In addition to the Bayan Khundii project, other deposits
and prospects within these licenses include: Altan Nar – an extensive, high-grade, near-surface,
gold-polymetallic project located 16 kilometres northwest of Bayan Khundii that the Company is
actively advancing; Altan Arrow – an early -stage gold -silver project 3.5 kilometres north of
Bayan Khundii; Ulaan – a recently acquired copper -gold porphyry prospect adjacent to Bayan
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Khundii; Khuvyn Khar – an early -stage, copper -silver porphyry project with multiple drill
targets and significant copper intersecti ons; Nomin Tal – a narrow, high -grade copper -gold
discovery; and Zuun Mod – a large mol ybdenum-copper porphyry deposit. In addition to the
above properties, the Company has an Alliance with Teck Resources Limited on regional
copper-gold exploration in the prospective Trans Alta i region of southwest Mongolia. For
further information on the Company, please visit www.erdene.com. Erdene has 145,963,086
issued and outstanding common shares and a fully diluted position of 156,592,160 common
shares.
FORWARD-LOOKING STATEMENTS
Certain information regarding Erdene containe d 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 statemen ts 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 cautions that actual performance will be
affected by many factors, most of which are beyond its control, and that future events and results
may vary substantially from what Erdene currently foresees. Factors that could cause actual
results to differ materially from those in forward -looking statements include ma rket prices,
exploitation and exploration results, 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
obligation to revise or update these forward-looking statements, except as may be required under
applicable securities laws.
ERDENE CONTACT INFORMATION
Peter C. Akerley, President and CEO
or
Ken W. MacDonald, Vice President and CFO
Phone: (902) 423-6419
E-mail: [email protected]
Website: www.erdene.com
Twitter: https://twitter.com/ErdeneRes
No Regulatory Authority Has Approved or Disapproved The Contents of This Release
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