ERDENE EXPANDS NEW ULAAN GOLD DISCOVERY 53 Metres of 3.5 g/t Gold within 217 Metres of 1.1 g/t gold, 50 metres North of Discovery Hole
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ERDENE EXPANDS NEW ULAAN GOLD DISCOVERY
53 Metres of 3.5 g/t Gold within 217 Metres of 1.1 g/t gold, 50 metres
North of Discovery Hole
Press Release
Halifax, Nova Scotia
2021.09.23
Erdene Resource Development Corporation ( TSX: ERD | MSE: ERDN) (“Erdene” or the
“Company”) is pleased to announce results from follow-up drilling at the recent Ulaan gold
discovery, located 300 metres west of the Bayan Khundii gold deposit. Results for the
first five (5) drill holes, totaling 1,803 metres, are included herein . Further assay results
are expected to be released in early Q4.
Highlights
• Intersected the broadest intervals of mineralization in the Khundii Gold District to
date, along with local high-grade intervals:
o UDH-14: 216.6 metres of 1.07 g/t gold
§ Includes 5 metres of 19.58 g/t gold within 53 metres of 3.55 g/t gold
§ Ended in gold mineralization at 404.6 metres
o UDH-15: 364.3 metres of 0.79 g/t gold
§ Includes 10 metres of 7.29 g/t gold within 91 metres of 1.98 g/t gold
§ Ended in mineralization at 461.3 metres
o UDH-16: 119 metres of 0.59 g/t gold
o UHD-17: 36.3 metres of 2.26 g/t gold
§ Ended in 21.6 g/t gold over 2.3 metres at 350.3 metres
• Discovery remains open in all directions and at depth
o Assays from four (4) holes, totaling 1,401 metres scheduled to be reported
in early Q4.
Quotes from the Company:
“The Ulaan prospect has proven to be a major new gold discovery within our Khundii Gold
District,” said Peter Akerley, Erdene’s President and CEO. “The very broad zones of
mineralization, exceeding 200 metres, include multiple intersections exceeding 10 g/t gold
and demonstrate the potential scale of Ulaan mineralization, within 300 metres of our
Bayan Khundii Gold Deposit. Gold mineralization at Ulaan is open in all directions , and
multiple gold in soil and geophysical anomalies remain untested in areas to the west of
the discovery.”
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“Drilling at Ulaan and across the Khundii license continues with further results anticipated
by mid-Q4,” continued Mr. Akerley. “The confirmation of a significant gold zone at Ulaan,
coupled with the recent Dark Horse discovery, Bayan Khundii reserves and resources at
our Altan Nar property reinforce our thesis that the Khundii Gold District has the potential
to host a world class discovery.”
Summary of Drill Results
The current Ulaan drilling program was designed to delineate the extent of mineralization
around the discovery drill holes reported on August 11, 2021 ( see press release ). The
program consisted of nine (9) drill holes totaling 3,204 metres. Drill holes were spaced 25
to 50 metres apart and to a maximum depth of 461 metres, testing targets over an area
of approximately 1.2 square kilometres.
Assay results from five (5) drill holes (UDH-14 to UD H-18), with an aggregate of 1,803
metres, are reported herein. Highlights from the drilling program are provided below in
Table 1 and a drill hole plan map and section illustrating the location of the drill holes is
attached to this news release.
Table 1: Ulaan Q3 2021 Drilling Highlights
Hole From To Interval (1) g/t Au
UDH-14 106 117 11 3.68
Incl 110 111 1 36.58
And 188 404.6(2) 216.6 1.07
Incl 192 245 53 3.55
Incl 202 207 5 19.58(3)
Incl 208 209 1 16.75
UDH-15 60 63 3 0.41
And 97 461.3(2) 364.3 0.79
Incl 124 215 91 1.98
Incl 130 140 10 7.29
Incl 130 131 1 15.13
Incl 138 139 1 49.36
Incl 214 215 1 10.47
UDH-16 65 184 119 0.59
Incl 117 120 3 4.52
Incl 119 120 1 11.91
And 212 226 14 0.44
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Hole From To Interval (1) g/t Au
UDH-17 287 289 2 1.71
And 314 350.3(2) 36.3 2.18
Incl 344 350.3 6.3 8.59
Incl 348 350.3 2.3 21.57
UDH-18 4 6 2 0.51
And 142 146 4 0.45
And 263 279 16 0.32
And 300 308 8 0.65
And 346 350.3(2) 4.3 0.49
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. Each of the five one-metres samples in this interval returned gold values greater than 10 g/t gold, range was 15.53 to 21.76
g/t gold
Gold mineralization intersected at Ulaan begins less than 100 metres from surface and is
hosted within the same white mica altered lapilli tuff unit which hosts Erdene’s Bayan
Khundii epithermal gold deposit, which is immediately to the east of Ulaan on the Khundii
mining license. Gold grades range from 0.1 g/t to 49.4 g/t in direct relation to quartz ±
hematite veining which cross cuts the host tuff. At least two orientations of quartz veining
occur at Ulaan. Although both vein sets appear mineralized , exploration and analysis is
ongoing to identify any preferred anisotropy. Gold mineralization is also believed to be
controlled by lithology and s tructural offsets. In general , the highest-grade gold
mineralization occurs within intervals of pervasive silicification combined with adularia and
white mica alteration cut by epithermal style, irregular quartz-hematite, quartz-adularia,
quartz-white mica veins and quartz -chlorite-magnetite veins . In many instances visible
gold has been observed as disseminations within these veins.
Geophysical surveys were recently completed over the new Ulaan gold discovery
including ground magnetics and IP dipole -dipole. Processing and interpretation of these
geophysical datasets indicate a strong correlation between low amplitude magnetic
signatures and the interpreted altered lapilli tuff unit. IP resistivity indicates a strong
correlation between the high-grade intervals contained in UDH-10, UDH-14, UDH-15 and
UDH-16 and resistivity high signatures . These geophysical correlations to gold
mineralization will be applied to future targeting within the southern Ulaan prospect area.
Since Erdene acquired the remaining 49% interest in the Ulaan license in December 2020,
exploration activities have primarily focused on the southeastern portion of the license.
However, Erdene has identified several high priority targets throughout the license area,
including the untested West Gate target, situated in the northeastern region of the license.
At the West Gate target, gold has been identified in soil samp les that may represent an
extension of the Dark Horse mineralization. Additionally, Erdene intersected anomalous
gold and copper in previous drilling at the Tourmaline Breccia target in the northern region
of the Ulaan license.
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The 100% owned Ulaan exploration license and adjoining Khundii mining license combine
to cover the nearly 4,350-hectare Ulaan-Khundii hydrothermal alteration zone defined by
pervasive phyllic, argillic and silica alteration. Within the Ulaan-Khundii alteration footprint,
Erdene has discovered several high priority gold prospects and deposits including the low
sulphidation, epithermal Bayan Khundii gold deposit and more recently the Dark Horse
epithermal gold prospect and the South Ulaan gold discovery. Erdene continues to view
the greater Khundii -Ulaan alteration zone as an underexplored, large hydrothermal
system capable of hosting a world class gold deposit.
Additional d rilling is underway targeting the SE Ulaan discovery, Westgate and Dark
Horse prospects, with results expected to be announced in mid-Q4.
Ulaan Overview
Erdene holds a 100% interest in the Ulaan license after acquiring the remaining 49%
interest in the property in December 2020. The Company acquired an initial 51% stake in
the license in 2017, following the discovery of the Bayan Khundii gold deposit.
Ulaan lies at the southwest end of a major alteration zone, extending for over 10
kilometres to the northeast. This alteration trend has a central zone of intense secondary
silica with a periphera l halo of sericite alteration, and an outer zone of white mica and
sericite, which hosts the Bayan Khundii gold deposit. This northeast trending alteration
area, which incorporates the Ulaan, Bayan Khundii and other mineralized targets in the
area (includi ng Erdene’s Dark Horse and Altan Arrow prospects), is associated with a
regional structural dilational jog and associated major volcano -plutonic centre, along a
northeast trending transform fault. The various styles of alteration and mineralization
within the Ulaan target and the adjacent zone of alteration are consistent with a fertile
magmatic island arc, with evidence for possible arc migration, and overlapping or
telescoped mineralization along major structures.
The southern area of the 1,780-hectare Ulaan license is approximately 350 metres west
of the Bayan Khundii gold deposit, separated by the Khuren Tsav license held by the
Mongolian government-owned gold company, Erdenes Alt LLC (“EA”). In early 2021, EA
announced plans to undertake further drilling and geologic work on the portion of license
adjacent to Erdene’s Bayan Khundii and Ulaan licenses.
Based on the wide zone of gold mineralization intersected in this initial drilling program,
combined with satellite imagery, geophysical analysis, and surface alteration, Erdene
believes that the hydrothermal system that hosts the Bayan Khundii gold deposit extends
west-southwest of the Bayan Khundii deposit, across the northern portion of the Khuren
Tsav license, into the southern portion of Erdene’s Ulaan license. The northern portion of
the Khuren Tsav license is wedge -shaped and separates th e southern s ections of the
Bayan Khundii and Ulaan licenses. Erdene has an informal working relationship with EA
and both companies will explore opportunities to work together, including the sharing of
technical information, to ensure the development of their respective licenses in the best
interests of all stakeholders.
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The northern portion of the Ulaan license is situated along the western boundary of
Erdene’s Khundii Mining license and has the potential to host the western extension of
the Dark Horse mineralization based on preliminary review of the geology, alteration and
mineralization at surface.
Khundii Gold District
Erdene’s deposits are in the Edren 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 southwest Mongolia over the past decade and is responsible for
the discovery of the Khund ii Gold District comprised of multiple high -grade gold and
gold/base metal prospects, one of which is currently being developed, the 100%-owned
Bayan Khundii Gold Project, and another which is being considered for development, the
100%-owned Altan Nar Project. Together, these deposits comprise the Khundii Gold
Project.
The Bayan Khundii Gold Resource1 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
US$100 million and Internal Rate of Return (“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 early 2023 based on the
current project schedule.
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 interes ts in three
mining licenses and two exploration licenses 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 information is available at www.erdene.com. Important information may be
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, 2019 available on the
Company’s website or SEDAR
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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 n ews 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 standard fire assay analysis for gold and ICP-
OES (Inductively Coupled Plasma Optical Emission Spectroscopy) analysis for 33
additional elements. For samples that initially return a grade greater 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 geologica l 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 intersect 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
been applied; however, all intervals greater than 10 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 substantially from what Erdene
currently foresees. Factors that could cause actual results to differ m aterially from those
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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 o bligation 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-/
© 2021 Erdene Resource Development Corp.
All rights reserved
Bayan Khundii
Gold Deposit
Dark Horse Mane
Gold prospect
Altan
Arrow
Gold Prospect
West Gate
Gold Anomaly
Tourmaline
Breccia
Gold Zone
Khundii
North
Gold Prospect
ULAAN DRILLING CONFIRMS NEW DISCOVERY IN KHUNDII GOLD DISTRICT
Khundii – Ulaan Tenements, BK Deposit and Prospects Location Map
Ulaan
Exploration License
Erdene
100% Ownership
Khundii
Mining License
Erdene
100% Ownership
Intense White Mica
Sericitic
Core
Khundii – Ulaan Hydrothermal Alteration Footprint
Intense white mica and Phyllic Zone
Pervasive white mica Argillic zone
Intense Silicification
1 km 1 km
Khundii – Ulaan Active Discoveries and Prospects
ULAAN
GOLD DISCOVERY
South
Ulaan
Plan Map
Pervasive Alteration Footprint