The Altan Nar gold project (meaning Golden Sun) it is emerging as one of the most significant gold discoveries in Mongolia in the last few years.
Erdene Resource Development Corp. (TSX:ERD) (“Erdene” or “Company“), is pleased to report high-grade gold intersections from the Company’s recently completed, maiden drill program at its wholly-owned Bayan Khundii gold project in southwest Mongolia. Results reported herein are for the first six of 15 drill holes.
Highlights
“With high-grade gold, in multiple structures, identified at surface and now confirmed through drill intersections at shallow depths, Bayan Khundii continues to emerge as a very promising new gold discovery,” said Peter Akerley, President and CEO of Erdene. “Pending drill results will provide initial indications of continuity from the two most prominent prospects, Gold Hill and Striker.”
The following table summarizes the drill results received to date from the first six of 15 drill holes from the Q4 2015 Bayan Khundii exploration program.
Table 1 – Bayan Khundii drill results
* Reported intervals are not true width. They represent drill intersection widths from holes drilled at a 45 to 60 degree angle. The Bayan Khundii mineralization is moderately dipping (approximately 40 to 50 degrees) perpendicular to the drill hole angle.
Bayan Khundii Drill Program Q4 2015
The maiden drill program commenced on November 8, 2015 and consisted of 15, angled (45 to 60 degrees) diamond drill holes (‘P’ size core), totaling 695 metres. Drill hole depth ranged from 34 m to 70 m (average 46 m) with maximum vertical depth tested of approximately 50 m. The program was targeting the southwest portion of the Bayan Khundii trend, a 550 m by 300 m area, where previous exploration work completed by the Company in Q3 2015 returned highly anomalous gold values from surface sampling (over 20% of samples returned values in excess of 3.0 g/t gold, and up to 4,380 g/t gold) and from initial trenching, including 30 m of 2.7 g/t gold in trench BKT-01, and 1 m of 55.6 g/t gold in trench BKT-06.
The recent drilling program intersected zones of quartz breccia and comb-quartz veining within pervasive silica and sericite altered volcanic host rocks with extensive primary hematite within veins and along fractures. Visible gold was observed in a number of quartz veins (including some of the drill holes with assays pending) as irregular shaped grains (up to 2 mm; see attached photo). The gold mineralization is associated with quartz veins and/or associated with hematite within or along the boundary of quartz-hematite veins and veinlets. The main mineralized veins are interpreted to be dipping 40 to 50 degrees to the southwest.
The intensely altered host volcanic units also carry anomalous gold mineralization (varying from 0.1 to 1.0 g/t gold over wide areas) associated with fine quartz and/or hematite veinlets. The strong, pervasive alteration and the extensive presence of primary hematite indicate a large intense alteration system that has positive implications for the potential size of the system. The Company completed a geophysical program over the Bayan Khundii prospect in Q4 that indicates the mineralization is located at the apex of broad chargeability and resistivity high anomalies.
Additional exploration of this high-grade gold discovery is now in the planning stage and is expected to include a second phase of diamond drilling in addition to metallurgical testing during the first half of 2016.
Please see attached for maps, a cross-section, and photo highlighting results of the Bayan Khundii drill program.
Bayan Khundii Project Background
In Q2 2015, Erdene conducted an initial exploration program on the southern portion of the Company’s 100%-owned Khundii license. This reconnaissance work led to the discovery of the Bayan Khundii (‘Rich Valley’) gold prospect, located within 20 km of the Company’s flagship Altan Nar gold-polymetallic project. Two separate mineralized zones (Main Zone and Northeast Zone) were identified over a 1.4 km area that remains open in all directions. At the Main Zone, eleven trenches, totalling 552 m, were completed. The program was successful in demonstrating wide zones of gold mineralization in the wall rock (30 m of 2.70 g/t gold in trench BKT-01) and high-grade mineralization in narrow veins (1 m of 55.6 g/t gold in trench BKT-06), as well as demonstrating continuity over a wide area. Click here to read the Company’s October 5, 2015 press release announcing the Bayan Khundii discovery.
Option Agreement with Tian Poh Resources Limited
Pursuant to the terms of an option agreement (“Agreement”) entered into on February 9, 2015 and amended on July 15, 2015, between ASX-listed Tian Poh Resources Limited (“Tian Poh”) and Erdene, Tian Poh had an option, exercisable until December 9, 2015, to acquire an interest in Erdene’s Zuun Mod mining license in southwest Mongolia. Tian Poh has elected not to exercise its option and, under the terms of the Agreement, the US$200,000 convertible debenture purchased by Tian Poh will be converted into shares of Erdene at C$0.14 per share. The Company looks forward to continuing to investigate opportunities to work together with Tian Poh in Mongolia.
Qualified Person and Sample Protocol
Michael MacDonald, P.Geo. (Nova Scotia), Director of 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. 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.
Erdene’s sampling protocol for drill core consisted of collection of samples at 1 m or 2 m intervals (depending on the lithology and style of mineralization) over the entire length of the drill hole. Sample intervals were based on meterage, not geological controls or mineralization. All drill core was cut in half with a diamond saw and half core was placed in sample bags and half core is securely retained in core boxes at the Company’s Tsenkher Nomin (Altan Nar) exploration camp. All samples were organized into batches of 20 samples including two commercially prepared standards. Sample batches were periodically shipped directly to SGS in Ulaanbaatar via Erdene’s logistical contractor, Monrud Co. Ltd.
As a result of the coarse nature of some of the gold mineralization at Bayan Khundii, the Company has initiated a screen metallic testing program on higher grade samples to assess potential variability.
About Erdene
Erdene Resource Development Corp. is a Canada-based resource company focused on the acquisition, exploration, and development of base and precious metals in underexplored and highly prospective Mongolia. The Company holds four exploration licenses and a mining license located in southwest Mongolia. These include: Altan Nar – an extensive, high-grade, near-surface, gold-polymetallic project that the Company is aggressively advancing toward a production decision, however the Company has not yet completed a mining study to support the technical feasibility and economic viability of Altan Nar; Bayan Khundii – an early-stage, high-grade gold discovery made in Q3-2015; Khuvyn Khar – an early-stage, copper-silver porphyry project with multiple drill targets and significant copper intersections; Zuun Mod – a large molybdenum-copper porphyry deposit; and Altan Arrow – an early-stage, high-grade, gold-silver project. In addition to the above properties, the Company has an Alliance with Teck Resources Limited on regional, copper-gold exploration in the prospective Trans Altay region of southwest Mongolia. For further information on the Company, please visitwww.erdene.com. Erdene has 105,060,005 issued and outstanding common shares and a fully diluted position of 124,271,495 common shares.
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 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
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