Erdene Resource Development Corp.
(
TSX:ERD; MSE:ERDN) ("
Erdene" or
the "
Company") is pleased to report results from
the Q4-2019 exploration program on its Altan Nar, Khundii and Ulaan
licenses.
“We are very encouraged by the results of the
December 2019 drilling at Altan Nar which returned multiple shallow
intersections in excess of 50 g/t gold,” said Peter Akerley,
Erdene’s President and CEO. “These results expand the high-grade
core of the Discovery Zone deposit and open up new areas for future
drilling that should positively impact Altan Nar resources.”
“These results, combined with the expansion of
the new Khar Mori gold prospect area and the extension of gold
mineralization south of Bayan Khundii in Q3-2019, continue to
demonstrate the prospectivety of Erdene’s Khundii Gold District,”
stated Mr. Akerley. “We are maintaining a dual focus on advancing
our high-grade, open-pit, 60,000 ounce per year Bayan Khundii Gold
Project to production, while drilling targets on adjacent prospects
to grow our resource base.”
Highlights [see attached figures for
reference]:
- Altan Nar (Gold-Polymetallic Resource):
- Drilling expands high-grade core of the Discovery Zone:
- 45.7 g/t gold, 93.4 g/t silver, 1.54% lead and 3.40% zinc over
7 metres beginning at ~ 70 metres vertical depth, within 23 metres
grading 17 g/t gold (TND-135)
- 12.2 g/t gold over 10 metres (TND-134) including 2 metres of
52.9 g/t gold confirming high- grade gold mineralization south of
the “Gap Zone”
- 10 metres of 4.68g/t (TND-138) confirming high-grade gold
mineralization north of the “Gap Zone”
- TND-136 confirms continuity of mineralization now open to the
south
- Khar Mori (Gold):
- Rock chip samples of 87.8 g/t gold, 18.2 g/t gold, 15.3 g/t
gold and 12.1 g/t gold near the 32.9 g/t gold rock chip collected
in early Q4-2019
- Geochemical sampling and mapping expand prospect area to 1.5km
X 2km
- Ulaan (Copper-Gold):
- Gold bearing tourmaline breccia pipe intersected
Q42019 Exploration Program SummaryAs the Bayan
Khundii gold deposit advances through studies and permitting, the
exploration team shifted focus in late 2019 to expanding resources
throughout the District with follow up work on three priority
targets: Altan Nar (Golden Sun), Khar Mori (Dark Horse) and the
area surrounding the Bayan Khundii (Rich Valley) Deposit.
Following a detailed review and modelling of the
Discovery Zone deposit at Altan Nar, 16 km north of the Bayan
Khundii gold development, the exploration team developed a
plan to test a concept for a preferred gold mineralized horizon
believed to represent an epithermal boiling zone that could host
continuity of the very high grades intersected during the most
recent drilling campaign in 2017. Additionally, the Khar Mori
prospect identified earlier in Q4-2019 was expanded to a 1.5km X
2km zone with multiple high grade grab samples of up 89g/t gold,
bordering the Altan Arrow prospect to the north where shallow
drilling previously intersected up to 2 metres of 70 g/t
gold.
The focus of the exploration team in 2020 will
be on expanding resources within these three highest priority areas
including incorporating today’s results into a comprehensive review
and interpretation program in advance of fieldwork in Q2-2020 and
further drilling in mid-2020.
Altan Nar DepositIn late Q4-2019, the company
drilled five holes totaling 667 metres in the Discovery Zone
(“DZ”), one of 18 high-priority targets along a 5.6 kilometre
mineralized trend on its 100% owned Altan Nar project. The Q4-2019
program successfully tested a concept of a preferred high gold
mineralized horizon believed to represent an epithermal boiling
zone. Four holes tested the high-grade core area of the Discovery
Zone, over a 130 metre strike length, 70 metres of which remains
untested by drilling (“Gap Zone”). The fifth hole tested the
southern extension of the deposit.
Table 1 – Summary of Altan Nar Drilling
Results
Hole ID |
From |
To |
*Measured Width (m) |
Au g/t |
Ag g/t |
Pb % |
Zn % |
TND-134 |
101.0 |
111.0 |
10.0 |
12.2 |
21.0 |
0.55 |
1.18 |
Incl |
105.0 |
107.0 |
2.0 |
52.9 |
59.5 |
1.77 |
3.80 |
TND-135 |
97.0 |
120.0 |
23.0 |
17.0 |
44.7 |
0.75 |
1.47 |
Incl |
105.0 |
112.0 |
7.0 |
45.7 |
93.4 |
1.54 |
3.40 |
incl |
105.0 |
106.0 |
1.0 |
108.0 |
81.0 |
1.16 |
2.79 |
incl |
106.0 |
107.0 |
1.0 |
52.9 |
135.0 |
3.80 |
6.22 |
incl |
108.0 |
109.0 |
1.0 |
52.8 |
149.0 |
1.50 |
3.10 |
Incl |
117.0 |
120.0 |
3.0 |
14.5 |
23.3 |
0.83 |
0.98 |
TND-136 |
84.0 |
86.0 |
2.0 |
0.99 |
0.0 |
0.14 |
0.24 |
and |
110.0 |
126.0 |
16.0 |
0.37 |
0.9 |
0.11 |
0.24 |
TND-137 |
6.0 |
13.0 |
7.0 |
2.64 |
11.1 |
0.66 |
0.43 |
and |
20.4 |
23.0 |
2.6 |
0.89 |
5.4 |
0.28 |
0.38 |
and |
69.0 |
73.0 |
4.0 |
1.76 |
9.0 |
0.10 |
0.24 |
TND-138 |
20.0 |
28.0 |
8.0 |
1.72 |
1.8 |
0.03 |
0.09 |
and |
40.0 |
44.0 |
4.0 |
1.54 |
4.3 |
0.17 |
0.17 |
and |
56.0 |
66.0 |
10.0 |
4.68 |
50.8 |
0.31 |
0.73 |
*Projected true width for TND-134, TND-135 and TND-136 is ~72%
of the measured width and for TND-137 and TND-138 is ~45% of the
measured width.
Hole TND-134 targeted the northeast strike
extension of the DZ core along a newly identified high-grade ore
horizon. TND-134 intersected 10 metres grading 12.2 g/t gold,
21.0 g/t silver, 0.55% lead and 1.18% Zinc (see Table 1 for summary
of results) hosted within a sulphide rich, chalcedonic quartz
epithermal breccia.
TND-134 has provided a 20-metre extension along
strike of the DZ high-grade core indicating consistency in
high-grade mineralization within the identified ore horizon,
expected to positively impact the resource at Altan Nar and opening
the way for further expansion along strike to the north.
Hole TND-135 targeted a previously untested area
of the DZ high-grade core. TND-135 intersected 23 metres of
17 g/t gold, 44.7 g/t silver, 0.75 % lead and 1.47 % zinc within a
black, sulphide rich epithermal breccia. Drill results from TND-135
demonstrate continuity in size and grade within the high-grade DZ
core, providing confidence in future expansion of the DZ high-grade
core.
Hole TND-136 targeted the southwest strike
extension to the DZ deposit. TND-136 intersected multiple anomalous
intervals including 2 metres of 0.99 g/t gold and 16 m of 0.37 g/t
gold. These intersections provide the strongest indications to date
of the southwest extension of the Discovery Zone, establishing the
potential to expand resources along the southwest structural
trend.
Hole TND-137 was designed to test a projected
zone of near surface, high-grade mineralization which would extend
the DZ North mineralization along strike to the southwest. TND-137
intersected 7 metres of 2.64 g/t gold, 11.1 g/t silver, 0.66% lead
and 0.43% zinc beginning 5 metres from surface. Strongly
anomalous intersections up to 1.76 g/t gold over 4 metres located
deeper in TND-137 once again confirmed the multiple zones of
mineralized epithermal breccia hosted within the DZ deposit.
Hole TND-138 was designed to establish
continuity of gold mineralization and grade within the northern
portion of the DZ by drilling a previously untested portion of the
zone. The drill hole intersected three separate intervals of gold
mineralization highlighted by 10 metres grading 4.68 g/t gold, 50.8
g/t silver, 0.31% lead and 0.73% zinc hosted within a quartz vein
stockwork and epithermal breccia. TND-138 has further established
the continuity of high-grade mineralization within the northern
portion of the DZ which should positively impact the Altan Nar
resource. Furthermore, it confirms the continuity of high grades on
the northern side of the “Gap Zone”, an untested area of central
Discovery Zone open for 70 metres to the south where it meets
TND-134 and TND-101.
Altan Nar BackgroundAltan Nar is located 16
kilometres north of the Erdene’s Bayan Khundii gold development,
currently progressing through a bankable feasibility study and
permitting. Altan Nar is an intermediate sulphidation,
carbonate-base metal gold (“CBMG”) deposit, that remains open at
depth and along the known 5.6-kilometre trend of the system. This
deposit type includes prolific gold deposits such as Barrick Gold’s
Porgera mine (Papua New Guinea), Rio Tinto’s formerly producing
Kelian mine (Indonesia), Lundin’s Fruta Del Norte deposit, and
Continental Gold’s Buritica project (Colombia). CBMG deposits
generally occur above porphyry intrusions in arc settings and may
extend for more than 500 metres vertically.
Only a small portion of the Altan Nar licence
has been drill tested and 90% of the NI 43-101 Mineral Resource
prepared by RPM Global in 2018 is within 150 metres of surface and
largely contained within 2 of the 18 targets with all zones open
along strike and at depth.
The current resource* based on data collection
up to May 7, 2018 includes:
- Indicated Resource includes 317,700 oz gold (at 2.0 g/t
gold), 31,600 tonnes (“t”) zinc, 29,000 t lead, and 2.35
million oz silver; and
- Inferred Resource contains 185,700 oz gold (at 1.7 g/t
gold), 23,700 t zinc, 22,300 t lead, and 865,800 oz
silver.
*Altan Nar Gold Project Bayankhongor Aimag,
Southwest Mongolia NI 43-101 Technical Report. June 21, 2018
Altan Nar has received limited exploration over
the past two years as the Company’s resources were focused on the
Bayan Khundii discovery. The most recent program, conducted in late
2016 and early 2017, successfully tested a structural intersection
which returned the highest grade intersection at Altan Nar – 14
metres (measured width) of 55.6 g/t gold (TND-101). The structural
intersections or zones of dilation provide the setting for the
emplacement of broader zones of mineralization along the main NNE
trending structural corridor. However recent interpretation
shows that the highest grades were hosted in a preferred, near
horizontal zone, now believed to represent an epithermal boiling
event. It is this combination of factors that creates the optimum
conditions for the deposition of these high grades as witnessed in
the results of the late-2019 drilling and which will help guide
future exploration in this deposit and throughout the 5.6 km
trend.
Many of the Q4-2019 high-grade intersections are
locally outside or in areas of previously low grade resource blocks
and therefore expands the DZ high-grade core indicating consistency
in high-grade mineralization within the identified ore horizon, and
are expected to positively impact the resource at Altan Nar and
opening the way for further expansion along strike and elsewhere in
the district. The program also demonstrated continuity of anomalous
gold and base metals along the structural corridor to the south of
the DZ, which will be tested further in upcoming programs.
Khar Mori Gold Prospect The Khar Mori prospect
is located 4.5 kilometers northeast of the Bayan Khundii gold
deposit and one kilometre southeast of the Altan Arrow prospect on
Erdene’s 100% owned Khundii Mining License. The Khar Mori
gold prospect was discovered in early Q4-2019 with the collection
of a 32.9 g/t gold rock chip sample hosted by massive tourmaline
cut by quartz stockwork veins. Follow-up surface exploration in
late Q4-2019, consisting of detailed geologic mapping and
geochemical sampling (rock chip and soil) identified multiple
samples grading greater than 5 g/t gold including an 87.8 g/t gold
rock chip sample hosted within a comb quartz-adularia veins. The
Q4-2019 program has expanded the Khar Mori prospect westward to an
area approximately 1.5km by 2km area, connecting with the adjacent
Altan Arrow gold prospect to the northwest.
Ulaan Copper-Gold Prospect
The 51% owned Ulaan exploration license is
located immediately west of Erdene’s Khundii mining license. Ulaan
is a porphyry copper prospect primarily based on the broad (5km by
4km) zone of phyllic (quartz-sericite-pyrite) alteration at
surface. A 702-metre, three hole, drilling program was
completed in late Q4-2019, testing the alteration system at depth
by extending the previous hole UDH-02 from 350 metres to a depth of
640 metres. Additionally, two scout holes were completed
peripheral to the main phyllic alteration zone with targets that
included a zone of clay alteration associated with a geophysical
anomaly (UDH-04) and a sericite-quartz-tourmaline breccia body
suggestive of an intrusion or porphyry related environment
(UDH-05).
Results from the Q4 2019 extension of UDH-02
showed a continuity at depth of the phyllic style alteration with
an abundance of anhydrite-quartz-magnetite veining within
volcanic-subvolcanic lithologies. The drill hole ended within
elevated copper values averaging 130 ppm over 22 metres within a
syenite porphyry.
Hole UDH-04 was drilled to test a geophysical
target which passed between two IP chargeability high signatures
residing above a resistivity high signature. The entire hole
exhibited sericite alteration and pyrite mineralization with
localized zones of tourmaline alteration and quartz veining within
an andesite host. No anomalous geochemistry was encountered.
Hole UDH-05 was drilled to test a tourmaline
breccia, a new geological target within the Ulaan exploration
license. A zone approximately 850 metres by 900 metres hosting
multiple silicified and sericite altered quartz tourmaline breccia
bodies was identified by spectral remote sensing and surface
mapping. UDH-05 intersected a broad zone of intense
tourmaline-silica-sericite alteration which hosts localized gold
bearing quartz-tourmaline breccia and breccia veins from 140 to 202
metres (end of hole). Anomalous gold bearing intervals include: 2m
of 1.3 g/t gold, 4m of 0.29 g/t gold, 2m of 0.5 g/t gold and 2m of
0.23 g/t gold or 40m of 0.15 g/t gold average grade. Anomalous
copper, >400ppm, was also intersected within the anomalous zone.
The Erdene technical team is reviewing these results along with
associated geology, geochemistry and geophysics to establish the
basis for future drill testing on the Ulaan license.
Khundii Gold District
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. The Company has
been the leader in exploration in southwest Mongolia over the past
decade and is responsible for the discovery of the Khundii Gold
District comprised of multiple high-grade gold and gold/base metal
prospects, two of which are being considered for development: the
100%-owned Bayan Khundii and Altan Nar projects. Together, these
deposits comprise the Khundii Gold Project.
In October of 2019, Erdene announced the results
of an independent Technical Report for the Khundii Gold Project
(press release here), which included a Pre-feasibility Study
(“PFS”) for the Bayan Khundii deposit and an updated Preliminary
Economic Assessment (“PEA”) for the Altan Nar deposit. The PFS and
the updated PEA results include an after-tax Net Present Value at a
5% discount rate and a US$1,300/oz gold price of US$97 million and
US$24 million, Internal Rate of Return (“IRR”) of 42% and 90% for
Bayan Khundii and Altan Nar deposits, respectively. The PFS
envisions an open-pit mine at Bayan Khundii from Years 0-7,
producing an average of 61,000 oz gold per year at a head grade of
3.73 g/t gold, and an open-pit operation at Altan Nar during Years
7-10, for an average annual production of 48,000 oz gold at an
average head grade of 3.46 g/t gold, utilizing a conventional
carbon in pulp processing plant at the Bayan Khundii mine. Erdene
has secured a mining license for the Bayan Khundii deposit in
August of 2019 and plans to start producing gold in late
2021. The Altan Nar PEA is by nature, a preliminary economic
study, based in part on Inferred Resources. Inferred Resources are
considered too speculative geologically to have the economic
considerations applied to them that would enable them to be
categorized as mineral reserves which is required for a
prefeasibility or feasibility study. Mineral resources that are not
mineral reserves do not have demonstrated economic viability and
there is no certainty that the PEA will be realized.
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 licenses and two mining 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 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 Plasma Optical Emission
Spectroscopy) analysis for 33 additional elements. For Bayan
Khundii 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 m 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
intervals, or a laboratory duplicate. Sample batches were
periodically shipped directly to SGS in Ulaanbaatar via Erdene’s
logistical contractor, Monrud Co. Ltd.
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)
423-6419Email:
info@erdene.comTwitter:
https://twitter.com/ErdeneResFacebook:
https://www.facebook.com/ErdeneResourceLinkedIn:
https://www.linkedin.com/company/erdene-resource-development-corp-/YouTube:
https://www.youtube.com/channel/UCILs5s9j3SLmya9vo2-KXoA
Photos accompanying this announcement are available at
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