Erdene drills 123.5 g/t gold over 5 metres at Dark Horse, Mongolia

Erdene Resource Development Corp. [ERD-TSX; ERDCF-OTC; Mongolia] provided an update on recent exploration at the Dark Horse prospect, located 2.4 km north of its 100%owned construction-ready Bayan Khundii gold project, southwest Mongolia.

Highlights include extending Dark Horse Mane mineralization 100 metres south. The prospect remains open to the north, south and at depth. Drilling intersected the highest grade mineralization at Dark Horse to date, beginning near surface.

Drill hole AAD-176 returned 18 metres of 6.4 g/t gold beginning at surface, including 4 metres of 25.2 g/t gold. Hole AAD-177 returned 23 metres of 11.4 g/t gold beginning 1 metre downhole, including 4 metres of 59.8 g/t gold within 8 metres of 32.2 g/t gold.

Hole AAD-178 returned 15 metres of 42.8 g/t gold beginning 11 metres downhole, including 3 metres of 160.4 g/t gold within 5 metres of 123.5 g/t gold. Two holes returned intervals over 100 g/t gold (up to 195 g/t gold). The drilling highlights potential for near-surface, high-grade oxide gold mineralization across Khundii District. There are multiple targets with similar signatures on Erdene’s Khundii, Ulaan and Altan Nar licenses.

“Today’s results include the highest grade intersections at Dark Horse to date and confirm extension of this extremely high grade gold oxide zone,” said Peter Akerley, President and CEO. “This expanding, near-surface zone should enhance near term cash flow of our Bayan Khundii Gold Project and supports increased exploration for oxide gold targets along trend and throughout our Khundii Gold District.”

“Work is underway to assess the financial and technical impact of this mineralization on our adjacent, construction ready Bayan Khundii Gold Project,” continued Akerley. “Our 2022 exploration program is under development, with follow-up drilling planned in late Q1 to continue our efforts to demonstrate a multimillion-ounce gold district.”

This most recent Dark Horse drill program, completed in December 2021, was designed to test near-surface, oxide gold mineralization south and north (along strike) of previous drilling along the Dark Horse Mane structure. The program consisted of 23 holes, and one hole-extension, totaling 1,586 metres. Average hole length was 66 metres, representing an average vertical depth of 47 metres.

The drilling program was successful in identifying and extending a zone of high-grade, near surface, gold mineralization at Dark Horse Mane south by approximately 100 metres.

Drilling in Dark Horse Mane north was successful in intersecting a broad zone of clay alteration and extending low grade gold mineralization (15 metres of 0.64 g/t in AAD-186) at the southern extent of the zone. Narrower zones were returned in drilling at the northern end with the current strike length of approximately 500 metres for the gold-bearing oxide zone at Dark Horse Mane north.

Drilling to date has defined a 1.5-km trend of alteration and gold mineralization within the Dark Horse Mane target area that remains open along strike to the north and south, and at depth. To date Erdene has completed 21,673 metres of drilling in 190 holes ranging in vertical depths from 21 to 318 metres within the greater Dark Horse prospect portion of the Khundii mining license.

There are multiple highly prospective areas across the greater Dark Horse area, in the northern portion of Erdene’s 2,309 hectare Khundii Mining license that remain untested.

The Bayan Khundii gold resource 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 gold , providing significant potential for reserves growth with the development of the remaining M&I and Inferred resources1.

In July 2020, Erdene announced results of an independent Feasibility Study for the Bayan Khundii Gold Project. 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/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 2023 based on the current project schedule.