Erdene Reports Q3 2018 Financial and Operating Results
Erdene Reports Q3 2018 Financial and Operating Results
Halifax, Nova Scotia – November 15, 2018 - Erdene Resource Development Corp. (TSX:ERD)
("Erdene" or "Company"), is pleased to announce financial and operating results for the three and
nine months ended September 30, 2018 . This release should be read in conjunction with the
Company’s Q3 2018 Financial Statements and MD&A, available on the Com pany’s website or
SEDAR at www.sedar.com.
“The third quarter was a very active period for our Company. Following the announcement of the
maiden resource estimate for the Khundii Gold Project in September, we engaged RPM Global to
prepare the Project’s Preliminary Economic Assessment , scheduled to be deli vered in the fourth
quarter,” said Peter Akerley, Erdene’s President and CEO. “Concurrently, we launched technical
studies in preparation of mining license applications, to be submitted by year-end.”
“Outside of this detailed pre -development work, we see regional exploration as a key value driver for
our Company, as our exploration teams advance our early-stage gold targets on the Bayan Khundii
license. On the acquisition front , Mongolia’s Ministry of M ining and Heavy Industry released tender
blocks in southwest Mongolia in November , the first land released in this area in several years. We
have developed the largest pr oprietary geologic database in the region which will assist our team in
evaluating these properties for acquisition.”
Operational Highlights
Commenced the Preliminary Economic Assessment (“PEA”) for the Khundii Gold Project , the
first economic study on the project, scheduled to be completed in late Q4 2018.
Filed the NI 43 -101 Mineral Resource Technical Report for the Khundii Gold Project on
November 1, 20181:
Gold-only resource at 0.6 to 0.7 g/t gold cut -off 1: 751,000 ounces gold at an average
grade of 2.3 g/t gold, Measured and Indicated, and 291,000 ounces gold at an average
grade of 1.8 g/t gold, Inferred (0.6 to 0.7 g/t gold cut-off 1).
Gold-only resource at 1.4 g/t gold cut -off: 642,000 ounces gold at an average grade of
3.7 g/t gold, Measured and Indicated, including 357,000 ounces gold at an average
grade of 5.2 g/t gold at the Bayan Khundii deposit.
Gold-Equivalent (“AuEq”) resource at 0.6 to 0.7 g/t gold cut -off 1: 886,000 ounces
AuEq at an average grade of 2.7 g/t AuEq, Measured and Indicated, and 382,000 ounces
AuEq at an average grade of 2.3 g/t AuEq, Inferred.
1. See the technical report, titled “Bayan Khundii Gold Project, Bayankhongor Aimag, Southwest
Mongolia, National Instrument 43 - 101 Mineral Resource Technical Report” dated November
1, 2018, prepared by RPMGlobal Asia Limited . The report is available under the Company’s
profile at sedar.com and is also available on the Company’s website at
www.erdene.com.RPMGlobal recommended cut-off grade for Bayan Khundii is 0.6 g/t gold and
Altan Nar is 0.7 g/t AuEq above a pit and 1.4 g/t AuEq below the same pit shell.
Initiated technical studies in support of the registration of the Khundii Gold Project resources
ahead of mining license applications for Bayan Khundii and Altan Nar planned for Q4 2018.
Drilled 25 holes totaling 3,452 metres, testing 7 targets focused on the Altan Arrow and
Khundii North prospects within the Bayan Khundii license.
Approximately 70% of the holes at Altan Arrow have intersected anomalous gold , with
three holes intersecting greater than 20 g/t gold over 1 to 2 metre intervals.
Three holes in the southern portion of Khundii North intersected wide zones of intense
multi-phase, epithermal quartz stockwork and breccia , with associated anomalous gold
mineralization up to 2.1 g/t gold.
Submitted a bid for a tender license on November 14, one of the firs t parcel s of properties
released by Mongolia’s Ministry of Mining and Heavy Industry in the last decade.
Erdene has assembled the largest proprietary geologic database in southwest Mongolia ,
including 22 high-priority targets.
Financial and Corporate Update
The Company had a working capital position of $2. 3 million as at November 9, 2018 . Current
working capital is expected to fund the Company’s budgeted expenditures through Q1 2019.
Erdene's Q3 2018 Financial Statements and Management Discussion & Analysis were filed
with regulatory authorities on November 14, 2018 and are available on the Company's website
and SEDAR.
For the nine months ended September 30, 2018, the Company recognized a net loss of $2 .9
million, or $0.02 per share, compared to a n et loss of $3 .4 million, or $0.02 per share for the
same period in 2017.
Exploration expenditures, including capitalized costs, totalled $4 .8 million for the first nine
months of 2018 , compared with $8 .3 million for the same period in 2017, a decrease of 4 2%.
Together, the Bayan Khundii and Altan Nar projects represented $3 .2 million or 66% of the
exploration expenditures compared with $7 .4 million or 89% of exploration expenditures for
the same period in 2017.
Cash exploration expenditures for the first n ine months of 2018 were $4 .4 million, compared
with $7.7 million for the same period in 2017.
Excluding non -cash share -based compensation and depreciation, cash corporate and
administrative expenses for the first nine months of 2018 were $1 .0 million compared with
$1.3 million for the same period in 2017, a decrease of 17%.
Background on the Khundii Gold Project
Erdene’s deposits are located in the Edren Terrane, within the Central Asian Orogenic Belt, host to
some of the world’s largest gold and copper -gold deposits. Although epithermal gold and porphyry
copper-gold deposits are well documented across the border in China and along the Belt’s westward
trend, exploration in Mongolia was limited until the mid -1990’s, when the country opened its doors to
foreign exploration . Exploration since that time in southeast Mongolia led to t he discovery of the
world-class Oyu Tolgoi gold -copper deposit. Erdene has been the leader in e xploration in Mongolia’s
southwest over the past decade and is responsible for the discovery of the Khundii Gold District with
multiple high -grade gold and base metal prospects . The Khundii Gold Project is comprised of t wo
deposit areas, approximately 16 kilometres apart, which are being considered for development; Bayan
Khundii and Altan Nar . In addition, the Company has defined a large molybdenum -copper resource
on the 100%-owned Zuun Mod project, 40 kilometres to the east of the Khundii Gold Project . These
deposits are located in southwest Mongolia, approximately 200 kilometers from the major coal mining
centre and rail hub at the Ceke border crossing with China.
Over the past two years, drilling at the Altan Nar and Bayan Khundii projects has revealed very high
gold grades, including intercepts up to 2,200 g/t gold over 1 metre within 14 metres of 158 g/t gold at
Bayan Khundii, and intercepts up to 101 g/t gold over 1 metre within 20 metres of 10.3 g/t gold at
Altan Nar. Outside of these tw o deposits, which will be the focus of a Preliminary Economic
Assessment study in Q4-2018, the Company continues its regional, district-scale exploration program.
The broader district, although still in its infancy, host s the full spectrum of arc -related b ase and
precious metal systems, including copper -gold porphyries, intermediate sulphidation / carbonate base
metal gold deposits, and low sulphidation epithermal gold and gold-silver systems.
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 on behalf of Erdene. All sampl es 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 , field
and laboratory duplicates, and blanks.
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 four exploration license s and a mining 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 Mongolia stock exchanges.
Further information is av ailable at www.erdene.com. Important information may be disseminated
exclusively via the website; investors should consult the site to access this information.
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, guida nce 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 cau tions 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 ma terially from those in
forward-looking statements include 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
Ken W. MacDonald, Senior Vice President and CFO
Phone: (902) 423-6419
E-mail: [email protected]
Website: www.erdene.com
Twitter: https://twitter.com/ErdeneRes