Erdene Expands Mineralization at Zuun Mod Molybdenum-Copper Project IN Khundii District
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ERDENE EXPANDS MINERALIZATION AT ZUUN MOD
MOLYBDENUM-COPPER PROJECT IN KHUNDII DISTRICT
Press Release
Halifax, Nova Scotia
2023.07.06
Erdene Resource Development Corporation (TSX: ERD | MSE: ERDN) (“Erdene” or the
“Company”) is pleased to announce results from a recently completed 12-hole drill
program at its 100% owned Zuun Mod molybdenum-copper porphyry project in
southwestern Mongolia, located within the Khundii Minerals District, 35 kilometres east of
the Bayan Khundii Gold Project (See Figures 1 & 2).
Quotes from the Company
“Recent exploration at the Zuun Mod project, one of Asia’s largest undeveloped
molybdenum-copper deposits, demonstrates the potential to significantly increase the
scale of resources,” said Peter Akerley, Erdene’s President and CEO. “Results from
multiple drill holes along the current resource boundary expanded mineralization and
intersections within the core of the deposit exceeded the average block grades in the
vicinity. Additionally, the discovery of resource-grade mineralization in an exploration hole
1.7 kilometres north of the deposit further demonstrates the upside to this large
molybdenum-copper complex, which remains open in all directions.”
“Mongolia’s location, next to the largest molybdenum consumer, as well as its rapidly
improving infrastructure, support the development potential of Zuun Mod,” continued Mr.
Akerley. “Additionally, the importance of molybdenum and copper as critical minerals
supporting the green transition adds further impetus for development.”
Zuun Mod Drilling Results
The 2023 Zuun Mod exploration program had two main objectives, both of which were
accomplished:
1. Confirm continuity of the high-grade deposit core and expand mineralization on
the periphery of the deposit defined in the 2011 NI 43-101 Resource Report
prepared by RPMGlobal; and
2. Demonstrate potential for large scale expansion of mineralization associated with
the Zuun Mod Molybdenum-Copper deposit.
Five holes, totaling 2,476 metres, were drilled to confirm continuity of higher-grade
mineralization in the central part of the deposit (ZMD-131) and to expand continuity of
Indicated Resources at the periphery of the deposit (ZMD-132 to 135). A further seven
holes, totaling 1,619 metres (ZMD-136 to 142) tested targets across the greater Zuun
Mod porphyry complex. Highlight intersections from the exploration program are shown
in Table 1 below.
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Table 1 – Summary of Significant Assay Results
Hole # From To Width(3) (m) % Cu % Mo MoEq%(2)
ZMD-131 116 490 374 0.072 0.053 0.063
Incl 246 320 74 0.088 0.080 0.092
Incl 252 280 28 0.121 0.140 0.157
Incl 444 472 28 0.099 0.081 0.095
ZMD-132 260 310 50 0.081 0.040 0.051
Incl 260 282 22 0.088 0.060 0.072
ZMD-133 48 70 22 0.044 0.041 0.047
And 130 150 20 0.038 0.042 0.047
And 222 284 62 0.055 0.043 0.051
And 324 492 168 0.041 0.044 0.050
Incl 366 416 50 0.046 0.061 0.069
Incl 396 416 20 0.053 0.081 0.091
ZMD-134 74 116 42 0.047 0.040 0.047
ZMD-135 190 376.7(1) 186.7 0.065 0.060 0.069
Incl 254 274 20 0.070 0.085 0.095
Incl 308 328 20 0.080 0.081 0.092
Incl 338 362 24 0.094 0.085 0.098
ZMD-139 240 252 12 0.035 0.067 0.072
(1) End of Hole
(2) MoEq is calculated based on US$20/lb Mo and US$3.70/lb Cu. Based on metallurgical tests to date, a Cu recovery
factor of 75% was used.
(3) Reported intervals in this release are downhole apparent widths. Continued exploration is required to confirm
anisotropy of mineralization and true thicknesses.
Hole ZMD-131 intersected a very wide zone of mineralization, returning 374 metres
averaging 0.053% Mo and 0.072% Cu, with multiple zones (28 to 74 metres wide)
averaging greater than 0.080% Mo, including a 28-metre interval (252 to 280 metres)
averaging 0.140% Mo and 0.121% Cu. Considering the strong continuity of molybdenum
mineralization in the high-grade core, the Company is studying the potential of higher
density drill spacing to refine the block modelling of higher grade zones. The attached
map and sections show the continuity of higher grade molybdenum mineralization around
ZMD-131 (see Sections A & B – Figures 3 & 4).
All four holes on the periphery of Zuun Mod’s Indicated Resources (ZMD-132 to 135),
intersected resource-grade mineralization (>0.04% Mo) ranging in thickness from 40 to
187 metres. Highlights include ZMD-135, located along the north-western edge of the
deposit, which intersected 187 metres of 0.06% Mo, including multiple intervals, between
20 and 24 metres in width, grading greater than 0.08% Mo. Hole ZMD-133 which was
mineralized throughout most of its 551 metre length, starting less than 50 metres from
surface (46 to 551 metres, 505 metres averaging 0.032% Mo), included a two metre
interval exceeding 0.2% molybdenum.
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In addition, a exploration hole, ZMD-139, located 1.7 kilometres north of the main
molybdenum orebody (currently defined by ZMD-135), intersected a significant interval of
molybdenum mineralization, (12 metres of 0.067% Mo) hosted by porphyritic granodiorite,
typical of the Zuun Mod porphyry complex. No drilling has been carried out between the
Zuun Mod deposit and this hole, opening up a large area of potential expansion.
Geophysical resistivity data suggests a potential for continuity between these two areas
(see Section C – Figure 5).
Several of the exploration holes (ZMD-140 to 142) within the northern Zuun Mod porphyry
complex returned anomalous copper mineralization (greater than 0.05% Cu). ZMD-140,
drilled in an open area south of a previous copper discovery, returned three, two-metre
intervals exceeding 0.2% copper, and ended at 244 metres depth in copper mineralization
(greater than 0.1% Cu). The northern portion of the Zuun Mod porphyry complex hosts a
large area of disseminated copper mineralization within several kilometres of phyllic and
potassic altered quartz monzonite and granodiorite intrusives. Multiple copper
mineralized zones have been previously intersected in wide-spaced drilling, including 34
metres of 1.3% copper and 9.24 g/t silver from 308 to 342 metres (hole ZMD-121). This
zone remains untested at depth and to the southwest, where it trends under andesite
cover. The copper mineralized intervals are characterized by hydrothermally altered
intrusive breccias with potassic altered and mineralized fragments suggesting a deeper
source of the mineralization (see section D – Figure 6).
Approximately one kilometre west of the main deposit area, three holes (ZMD-136 to 138)
in a 600 metre east-west target area, returned anomalous molybdenum, copper and silver.
ZMD-137 returned increasing molybdenum over the final 40 metres (greater than 0.01%
Mo) and a silver zone higher in the hole (4 metres of 38.6 g/t Ag, starting 62 metres
downhole). Hole ZMD-138 returned anomalous molybdenum and copper, including 2
metres of 0.068% Mo at 144 metres depth, and near surface copper mineralization (0.2%
Cu at 4 metres downhole).
About the Zuun Mod Molybdenum-Copper Project
The Zuun Mod Molybdenum-Copper Project is located in Bayankhongor Province,
Mongolia, 180 kilometres northwest of a major mining district and the border with China,
the world’s largest copper and molybdenum consumer and steel producer. The 100%
owned 6,041-hectare mining license, underpinning the Project, was issued in 2011 and
is valid for up to an additional 60 years. The Project is located approximately 35 kilometres
east of Erdene’s Bayan Khundii Gold Project.
Erdene undertook a multi-year exploration program outlining the Zuun Mod molybdenum-
copper deposit, within a large porphyry complex and also identified multiple copper and
molybdenum prospects, within the outer rim of the 16-kilometre circumference porphyry
complex.
In 2011, Minarco-MineConsult (now RPMGlobal) prepared an NI 43-101 resource
estimate for a three-kilometre portion of the porphyry system, hosting the Zuun Mod Mo-
Cu deposit. Table 2 provides a breakdown of the reported mineral resource estimate at a
recommended cut-off grade (“cog”) of 0.04% Mo.
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Table 2. Zuun Mod Project Mineral Resource Estimate, June 2011
Resource
Category
Quantity
Mt
Cu % Contained Cu
Metal Mlbs
Mo % Contained Mo
Metal Mlbs
Measured 40 0.064 57.0 0.056 49.5
Indicated 178 0.070 273.7 0.057 224.0
M&I 218 0.069 330.7 0.057 273.5
Inferred 138 0.065 197.7 0.052 157.7
Source: NI 43-101 Technical Report, Zuun Mod Porphyry Molybdenum-Copper Project, Minarco-MineConsult, June
2011
Infrastructure Developments in Southwestern Mongolia
The Government of Mongolia (“GoM”) is actively implementing its New Recovery Policy
through stimulation of FDI and increased trade. As part of these initiatives, the GoM is
looking to improve infrastructure at the ports of Shivee Khuren, Gashuunsukhait, and
Bichigt. On May 27, construction commenced at the Shivee Khuren-Ceke rail crossing,
located in Gurvan Tes Soum of Umnugovi province, adjacent the Chinese port of Ceke
which is scheduled to be completed in late 2023. This project represents the first
installation of standard gauge track in the Country. This border crossing is approximately
180 km from Erdene’s Zuun Mod project. In the future, Mongolia Western vertical railway
network is envisioned to connect Shinejinst Soum to the Shivee Khuren port bringing rail
to within 30 km of Zuun Mod.
The GoM has also announced plans to build a hydro power plant in Erdeneburen Soum
in Khovd Province in cooperation with Chinese investors. This project would support
economic development in western Mongolia and provide a potential source of renewable
electricity for Zuun Mod.
On June 27, 2023, Mongolia and the United States signed a Memorandum of
Understanding (“MOU”) to advance the supply chain of critical minerals in the Indo-Pacific
region. Under the terms of this MOU, the United States has pledged to develop the
Mongolian critical minerals sector, including, by encouraging private sector investment.
About Molybdenum
Molybdenum is a critical component in high strength, anti -corrosion alloys used in
stainless steel, super alloys and as a component of many technologies associated with
the green energy transition as well as oil and gas pipelines and aerospace. Molybdenum
is lightweight, robust, and extremely resilient to high temperatures and corrosion
while enhancing strength, hardenability, weldability and temperature strength.
Global molybdenum production was 578 million pounds in 2022, while global usage rose
3% to 631 million pounds from 614 million pounds the previous year. Although
molybdenum output was largely stable for the past 5 years , production cuts at major
mines, delays in commissioning new projects and degrading resource quality in long life
molybdenum assets has led to shortages and a severe increase in the molybdenum price,
reaching all time highs in early 2023. Should the current level of growth be maintained
an additional 50M lbs of shortfall is projected over the next three years. Regional
consumption (China, Japan and Korea) exceeds 50% of the global supply and although
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China is the world’s largest producer, increasing production by 12% in 2022, it has been
unable to meet demand with a shortfall of approximately 20M lbs in 2022. (IMOA 03/04/23)
In addition, molybdenum is seeing strong demand from both the renewables and
traditional energy sector as its used in multiple clean energy generation and
storage technologies. The World Bank report "Minerals for Climate Action: The
Mineral Intensity of the Clean Energy Transition" named molybdenum as one of the
six cross-cutting critical minerals needed in all future green technologies (2020) ,
while the International Energy Agency also named molybdenum in 2021 as a critical
mineral for the green energy transition .
About Erdene
Erdene Resource Development Corp. is a Canada-based resource company focused on
the acquisition, exploration, and development of precious and base metals in
underexplored and highly prospective Mongolia. The Company has interests in three
mining licenses and an exploration license in Southwest Mongolia, where exploration
success has led to the discovery and definition of the Khundii Minerals District. Erdene
Resource Development Corp. is listed on the Toronto and the Mongolian stock exchanges.
Further information 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
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 protocol utilizing prepared
standards and blanks. All samples undergo combined multi-element ICP-OES
(Inductively coupled plasma optical emission spectroscopy) and ICP-MS (Inductively
coupled plasma mass spectrometry) analysis for 60 elements.
Erdene’s drill core sampling protocol consisted of collection of samples over 2 metre
intervals over the entire length of the drill hole, excluding minor post-mineral lithologies
and dykes. 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 inclu ding 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 Zuun
Mod drill holes (reported in this release) are all dipping at 85 degrees. 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 been applied.
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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 cautions 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 substantially from what Erdene
currently foresees. Factors that could cause actual results to differ materially from those
in forward-looking statements include the ability to obtain required third party approvals,
market 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.
NO REGULATORY AUTHORITY HAS APPROVED 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-/
YouTube: https://www.youtube.com/channel/UCILs5s9j3SLmya9vo2-KXoA
20 km
Landsat 8 True Colour
Porphyry Molybdenum-Copper Deposits and
Shallow, High-Grade, Gold Polymetallic Deposits and Prospects
Exploration License
Mining License
Prospect
Deposit
Au
Cu
Mo
Bayan Khundii Gold Deposit
Discovered: 2015
Shovel Ready High-grade, Open-Pit Gold
Project; >600koz >2g/t Au Resource
Ulaan SE Gold Discovery
Discovered: 2021
Blind-top Discovery
Dark Horse Gold Discovery
Discovered: 2021
High-grade, Near-surface Discovery
Discovered: 2012
Gold Polymetallic Deposit
>500koz Au Resource ~ 2g/t
Altan Nar Gold Deposit
ZM Moly & Copper Deposit
Largest Advanced, Undeveloped Molybdenum-
Copper Project in Asia; >400Mlbs Molybdenum
Khundii Gold Project production and economics based on July 2020 Bankable Feasibility Study
N
THE KHUNDII MINERALS DISTRICT –MOLYBDENUM-COPPER PROJECT
Molybdenum Copper Deposit, Four Gold Discoveries, and Multiple High-Priority Targets
ZUUN MOD PORPHYRY MO-CU PROJECT PLAN MAP
Molybdenum Soil Anomaly & Q2 2023 Drill Plan Map
ZMD
-
133
ZMD
-
134
ZMD
-
132
N
1cm1cm
ZMD-140ZMD-141
ZMD-138
ZMD-136
ZMD
-
139
ZMD
-
142
Section B
Section A
Section C
ZMD
-
135
ZMD
-
131
1 km
Section D
New Collar
Zuun Mod Resource
M&I NI 43-101 Classification
ZUUN MOD WEST
ZUUN MOD
DEPOSIT
ZUUN MOD
NORTH
ZMD-131: 277.6m
(0.83% Mo & 0.15% Cu(2m))
ZMD-131: 338.8m
(0.10% Mo & 0.06% Cu(2m))
Molybdenum
in soil
Anomaly
43-101 Resource Estimate Cutoff 0.04% Mo
Ordinary Kriging Estimate ZuunMod
NI 43-101
Classification
Tonnage Mo Mo Cu Cu Re Re
Mt % lbs (000's) % lbs (000's) PPM lbs (000's)
Measured 40 0.056 49,500 0.064 57,000 0.225 20
Indicated 178 0.057 224,000 0.070 273,700 0.242 95
Total M&I 218 0.057 273,500 0.069 330,700 0.239 115
ZMD-137