Erdene Intersects 33.5 G/T GOLD over 8 Metres Near Surface at Dark Horse Mane Discovery
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ERDENE INTERSECTS 33.5 G/T GOLD OVER 8 METRES NEAR
SURFACE AT DARK HORSE MANE DISCOVERY
Press Release
Halifax, Nova Scotia
2021.11.17
Erdene Resource Development Corporation ( TSX: ERD | MSE: ERDN) (“Erdene” or the
“Company”) is pleased to announce results from the follow-up drill program at Dark Horse
Mane, 2.4 kilometres north of the construction-ready Bayan Khundii Gold Pro ject. This
drilling program confirmed a high-grade oxide gold zone starting at surface, open at depth
and along strike.
Highlights
• Intersected high-grade gold, in near surface oxide zone in southern Dark Horse Mane:
o ADD-146: 17 metres of 16.7 g/t gold beginning 15 metres downhole
o Includes 8 metres of 33.5 g/t gold
o ADD-137: 24.5 metres of 9.4 g/t gold beginning 1.5 metres downhole
o Includes 13.5 metres of 16.1 g/t gold
o ADD-138: 25 metres of 6.1 g/t gold beginning 18 metres downhole
o Includes 8 metres of 17.1 g/t gold
o ADD-136: 30 metres of 5.6 g/t gold beginning 6 metres downhole
o Includes 13 metres of 11.6 g/t gold
• High-grade oxide ore is expected to be processed by the Bayan Khundii plant and
should improve the scale and economics of the Bayan Khundii Gold Project
• Drilling in northern Dark Horse Mane established a large-scale prospect at depth
o Extension of hole AAD-92 returned multiple gold bearing zones within a 100-
metre-thick alteration zone, and ended in over 1 g/t gold, 150 metres downhole
• Ulaan Gold prospect drilling commencing this week and follow-up Dark Horse drilling
to commence in late Q4 2021
o Follow-up exploration will test targets along strike and at depth, as well as other
potential oxide zones on the Khundii and Ulaan licenses
Quotes from the Company:
“Today’s results demonstrate the near-term value Dark Horse can add to the Bayan
Khundii development , as well as the potential scale of the Khundii-Ulaan alteration
system,” said Peter Akerley, Erdene’s President and CEO . “These near -surface high-
grade oxide gold zones have the potential to meaningfully elevate the Bayan Khundii Gold
Project’s economics, while also demonstrating the potential for near -surface targets
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throughout our license holdings. The Dark Horse Gold Zone has been traced over 1.5
kilometres and presents significant expansion potential in all directions.”
“Furthermore, these results strengthen our conviction that the greater Khundii -Ulaan
alteration trend, including Dark Horse, the Bayan Khundii Deposit, and the recent Ulaan
discovery, are part of the same gold-bearing hydrothermal system . This system shows
the potential to host a multimillion -ounce gold deposit ,” continued Mr. Akerley.
“Exploration drilling is currently underway at our Ulaan target, 3 kilometres south of Dark
Horse Mane, and follow-up drilling is planned to continue at Dark Horse later in Q4.”
Summary of Drill Results
The drilling results reported herein are from the Dark Horse Mane prospect. The primary
objective of the recent drilling program was confirming grade and continuity of near-
surface oxide gold mineralization . A total of 32 new holes and two hole-extensions,
totaling 2,286 metres were completed. While three holes were drilled to between 109 to
318 metres vertical depth, most drill holes (31) were between 21 and 61 metres vertical
depth.
Results from drilling to date confirm a 1.5-kilometre trend of alteration and gold
mineralization within the Dark Horse Mane target area that remains open along strike to
the north and south. Continuity of near-surface, oxide, supergene gold mineralization has
been defined over a strike length of approximately 350 metres in the south and over 500
metres in the north.
Table 1 below summarizes results from the Dark Horse Mane (south) prospect, which is
typified by oxide mineralization starting at surface with evidence of supergene enrichment.
Table 2 provides results for Dark Horse Mane (north) where near surface oxide
mineralization is prevalent, albeit lower grade than at Dark Horse Mane south.
Table 1: Dark Horse Mane (South) Q4 2021 Drilling Highlights (Intervals averaging
over 0.30 g/t gold)
Hole From To Interval (1) g/t Au
AAD-134 164 165 1 0.58
AAD-135 14 24 10 0.31
AAD-136 6 36 30 5.59
Incl 10 23 13 11.63
Incl 16 20 4(2) 24.06
AAD-137 1.5 26 24.5 9.37
Incl 4.5 18 13.5 16.08
Incl 4.5 9 4.5(2) 17.23
Incl 12 16 4(2) 27.68
AAD-138 18 43 25 6.06
Incl 26 34 8 17.07
Incl 25 26 1 29.94
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Hole From To Interval (1) g/t Au
Incl 31 34 3(2) 31.01
AAD-139 1.5 9 7.5 0.38
And 20 21 1 0.44
AAD-140 18 19 1 0.50
And 42 51 9 0.60
AAD-141 1.9 37 35.1 1.31
Incl 10 21 11 3.35
Incl 11 12 1 14.72
AAD-142 22 23 1 0.44
And 24 25 1 0.37
And 28 32 4 0.34
And 35 36 1 0.51
And 39 40 1 0.32
And 71 72 1 0.35
AAD-143 5 19 14 5.44
Incl 12 15 3(2) 18.74
AAD-144 13 49 36 1.25
AAD-145 41 43 2 2.71
And 70 72 2 0.74
AAD-146 6 7 1 1.11
And 15 32 17 16.65
Incl 22 30 8 33.52
Incl 22 25 3(2) 65.00
Incl 27 30 3(2) 21.12
AAD-148 5 28 23 1.15
AAD-149 26 42 16 1.34
AAD-151 21 33 12 0.53
And 38 58 20 0.41
AAD-152 14 26 12 0.56
AAD-153 23 26 3 0.48
AAD-154 37 38 1 0.37
1. Reported intervals in this release are downhole apparent widths. Continued exploration is required to confirm anisotropy of
mineralization and true thicknesses
2. For each of these intervals, all samples (1 to 1.5 metres) returned assays of greater than 10 g/t gold, ranging from 11.21 to
89.26 g/t gold
3. End of hole
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Table 2: Dark Horse Mane ( North) Q4 2021 Drilling Highlights (Intervals averaging
over 0.30 g/t gold)
Hole From To Interval (1) g/t Au
AAD-92X 53 85 32 0.51
And 96 98 2 0.50
And 108 120 12 0.50
And 132 150(3) 18 0.72
AAD-156 41 50 9 0.76
AAD-157 7 24 17 0.40
And 39 40(3) 1 0.65
AAD-158 16 26 10 0.76
AAD-159 7 9 2 0.32
AAD-160 15 16 1 0.59
And 20 24 4 0.36
And 32 40 8 0.99
AAD-161 8 10 2 0.60
And 36 40(3) 4 0.45
AAD-162 11 21 10 0.69
And 25 27 2 0.72
AAD-163 21 24 3 0.53
And 40 48 8 0.93
AAD-164 32 41 9 0.48
AAD-165 20 21 1 0.33
And 29 30 1 0.46
AAD-166 56 70 14 1.10
AAD-167 13 15 2 0.48
1. Reported intervals in this release are downhole apparent widths. Continued exploration is required to confirm anisotropy of
mineralization and true thicknesses
2. For each of these intervals, all samples (1 -1.5 metres) returned assays of greater than 10 g/t gold, ranging from 11.21 to
89.26 g/t gold
3. End of hole
The 350-metre southern portion of Dark Horse Mane oxide zone includes a very high-
grade gold zone, traced over 200 metre s, which was the focal point of recent drill ing.
Depth of oxidation reaches more than 100 metres locally, related to deep weathering
along structures. In this high-grade central zone, the main mineralized body begins within
one metre of surface, and ranges from 10 to 40 metres in thickness. The trend of the gold
mineralization at Dark Horse Mane is interpreted to be plunging to the north as shown in
the attached Sections 1 and 2. One previously reported hole, AAD-57, was drilled north
of the very high -grade zone and returned multiple two-metre samples grading greater
than 4 g/t gold , at a vertical depth of app roximately 200 met res. These results
demonstrate the potential for additional gold mineralization at depth , down plunge from
the mineralization identified near surface . As well, t his down-plunge mineralization may
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extend to depth under the northern portion of Dark Horse Mane prospect, an area that
has not been tested to date.
Two deeper holes were drilled in Dark Horse Mane south. The extension of AAD-68
intersected a major fault structure characterized by quartz tourmaline metasomatize d
zones with intense tectonic breccia and high -density calcite stockwork veining and
breccia. Gold values were low to locally anomalous, however, copper grades increase at
depth with the hole ending in anomalous 98th percentile copper grades (greater than 700
ppm). AAD-134 was drilled to a vertical depth of 2 10 metres and intersected zones of
anomalous gold and copper in phy llic altered volcanics throughout the hole , supporting
continuity of the alteration and mineralized zone.
In the northern portion of Dark Horse Mane , 12 new holes intersected low to moderate
oxide gold grades, with evidence of bifurcation or parallel gold zones (example AAD-166).
One of the three deeper holes completed in this program tested the north zone over a
total extended drill length of 150 metres (AAD-92) and successfully intersected multiple
zones of gold bearing, sugary quartz -hematite veins within phyllic altered volcanic units
of increasing alteration intensity and grade down hole ending in 1 g/t gold material. AAD-
92 is located adjacent to AAD -61 which returned 130 meters of 0.5 g/t gold (previously
reported April 22, 2021). These results present a very strong, untested target at depth in
the central area of the northern portion of Dark Horse Mane (see Section 3). Previous
results from Dark Horse Mane (north) returned high-grade intersections, of up to 16.2 g/t
gold over 1 metre, at approximately 100 metres vertical depth (AAD-51), further
confirming the potential for high-grade gold mineralization at depth.
The Company’s most recent geological modelling has identi fied multiple drill targets
designed to assess the mineral potential of this exciting discovery. Compilation and
interpretation work continues to define a larger-scale drilling program for Dark Horse and
throughout the broader target area.
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 as well as field and lab duplicates. 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 gold grade greater than 5 g/t, additional screen-metallic gold analysis
is carried out which provides a weighted average g old 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. Screen metallic grades are all reported.
Moving Forward
Follow-up d rilling at Dark Horse will commence later in Q4 , following drilling at Ulaan ,
where continuity and expansion of the new high-grade gold discovery (see press release)
is underway. Dark Horse drilling will include further shallow testing of the 2.4 kilometre
structure between Bayan Khundii and Dark Horse South , as well as the extension of the
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zone to the north. Selective testing of targets at moderate depths (200 to 300 metres) is
also planned.
The presence of gold-bearing oxide zones indicates that the level of erosion, hydrological
and atmospheric conditions within the Khundii-Ulaan alteration footprint are conducive to
seep oxidation and supergene enrichment gold mineralization. Evidence of these oxidized
zones is generally absent at surface as they correspond to the location of drainages that
mask the underlying material, albeit in some cases by little more than a metre. In addition,
reconnaissance drilling has typically targeted 50 metre plus vertical depth whereas this is
below the average depth of the highest grade gold in oxidized zones. The results from
Dark Horse Mane drilling demonstrate the potential for substantial, near-surface, oxide
gold zones, opening up multiple new targets across our license areas that will be followed
up in 2022. Erdene is planning to complete oxide-zone targeting over the broader Khundii
and Ulaan license using high density geochemical sample surveying and near surface
auger drilling to test subsurface regolith and undercover sub crop. Erdene is also
completing high resolution spectral remote sensing targeting surficial iron -oxide
signatures.
Dark Horse Overview
Erdene discovered Dark Horse Mane, 2.4 km north of the Bayan Khundii deposit , when
initial drilling, reported in early 2021, returned 5.97 g/t gold over 45 metres, beginning 10
metres downhole, including 8 metres of 27.1 g/t gold (AAD-58). This discovery
established Dark Horse as the most significant area of gold mineralization in Erdene’s
Khundii Gold District since the discovery of the Bayan Khundii gold deposit. To date the
Company has completed 14,681 metres of drilling in 128 holes at the greater Dark Horse
prospect, covering an area approximately 4.6 kilometres ( east-west) by 2.6 kilometres
(north-south). Drill hole vertical depths range from 21 to 318 metres and average only 87
metres.
The Dark Horse Mane zone is related to a north-south trending, linear structural corridor
which intersects deep seated northeast trending transform faults, believed to be a conduit
for primary mineralizing fluids . Gold mineralization is hosted within strongly altered
tuffaceous and volcanoclastic rocks, cross-cut by quartz and quartz-hematite veins and
stockwork zones. Recent drilling at Dark Horse Mane has confirmed the existence of a
shallow oxide zone, beginning from surface, hosting supergene enriched gold values up
to 89. 3 g/t over 1 metre. The high -grade oxide body exhibits strong continuity along a
north-south strike. Limits of mineralization and oxidation remain untested along strike and
at depth.
Khundii-Ulaan Mineralized System
The Ulaan exploration license and adjoining Khundii mining license cover nearly 4,000
hectares of the Khundii-Ulaan hydrothermal alteration zone , which extends from Ulaan
over 10 kilometres to the northeast. This alteration trend has a central zone of intense
secondary silica with a peripheral halo of sericite alteration, and an outer zone of white
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mica and sericite, which hosts the Bayan Khundii gold deposit. This northeast trending
alteration area, which incorporates the Ulaan, Bayan Khundii , Dark Horse and other
mineralized targets in the area, 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 Khundii-Ulaan target area are
consistent with a fertile magmatic island arc, with evidence for possible arc migration, and
overlapping or telescoped mineralization along major structures.
The Khundii-Ulaan hydrothermal alteration is characterized by pervasive argillic, phyllic
and silica alteration signatures centered within Erdene’s Ulaan exploration license and
extending onto Erdene’s Khundii mining license for over 10 kilometres. The Khundii-Ulaan
alteration footprint remains largely under explored with numerous gold occurrences and
geochemical and/or geophysical anomalies that warrant future testing.
Exploration results to date suggest the greater Khundii-Ulaan alteration zone and known
gold occurrences are part of the same , large, gold-bearing hydrothermal system which
remains largely under-explored. Gold mineralization identified to date is hosted within an
expansive, white mica and silica altered tuffaceous sequence exposed around the
periphery of the Khundii-Ulaan hydrothermal alteration system. Quartz vein textures and
clay alteration compositions indicate a large-scale epithermal type of gold mineralizing
environment existed within the Khundii-Ulaan system with the tuffaceous lithologies
acting as preferred hosts for gold mineralization . Exploration planning is currently
underway to test multiple high -priority geological, geochemical and geophysical targets
across the Khundii-Ulaan target area.
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.
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
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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, prod ucing 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 202 3 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 interests 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
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 protocol utilizing prepared
standards and blanks. All samples undergo standard fire assay analysis for gold and ICP-
OES (Inductively Coupled Pl asma 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 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
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