Erdene Announces Year-End Results and Provides Bayan Khundii Project Update

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HALIFAX, Nova Scotia, March 25, 2025 (GLOBE NEWSWIRE) -- Erdene Resource Development Corp. (TSX:ERD; MSE:ERDN) ("Erdene" or the "Company") is pleased to announce operating and financial results for the year ended December 31, 2024, and to provide an update on progress at the Bayan Khundii Gold Project, being developed with Mongolian Mining Corporation ("MMC”). This release should be read in conjunction with the Company's 2024 Financial Statements and MD&A, available on the Company's website and SEDAR+.

Peter Akerley, Erdene's President and CEO stated, "The past year was a period of significant progress for Erdene with the close of our Strategic Alliance with MMC, Mongolia's leading publicly traded mining company, the commencement of construction at the Bayan Khundii gold project and continued exploration success across the Khundii Minerals District.”

He continued, "The Bayan Khundii gold mine is one of the highest grade, open-pit gold mines under development globally and will be Mongolia's largest primary gold producer when it reaches full production. As of today, construction progress has exceeded 80% with most facilities scheduled for completion in Q1 and early Q2 2025. Three key facilities have been commissioned and process plant commissioning is expected to commence in May 2025, with first gold production scheduled in Q3 2025.”

Mr. Akerley concluded, "Expansion drilling during 2024 returned the highest grades to date adjacent to the planned Bayan Khundii open-pit, demonstrating strong growth potential. Additionally, ore-control drilling in late 2024 returned very positive results, confirming the high-grade nature of the Bayan Khundii deposit, and in some cases expanding mineralization. These results will be incorporated into an updated Bayan Khundii mine plan in the coming months.”

2024 Highlights and Significant Subsequent Events:

Images - clockwise from top left: Bayan Khundii Construction Site, Process Plant, Accommodation Village, and Crushing and Conveyor System, March 2025.

Bayan Khundii Gold Project

• Announced formal construction decision for Bayan Khundii on January 15, 2024
  • Awarded the Project's Engineering, Procurement and Construction ("EPC”) services contract to MCS Property LLC ("MCSP”), a leading Mongolian construction firm
  • Entered a power purchase agreement ("PPA”) for the construction of a 240 km overhead transmission line with MCS International LLC ("MCSI”), one of Mongolia's leading private energy companies
• Achieved 66% construction progress by December 31, 2024
  • Incurred US$83 million of expenditures to the end of Q4 2024
  • EM management estimates capital expenditures may increase by ~ 15% from the initial capital budget of US$100M due to inflation, the impact of weather and logistical delays and scope changes; however, no further equity funding is expected from Erdene or MMC for BK
  • Process plant, the critical path facility, was 67% complete at year end, with concrete and structural works substantially completed and all major equipment in place
  • Construction progress for non-process buildings was 60%, infrastructure facilities were 80%, and power supply was 52%, largely consistent with schedule
  • Commissioning of the integrated mineral waste facility was completed in Q4 2024 with the balance of the facilities planned progressively throughout Q1 and Q2 2025
  • Construction expected to be largely complete in May 2025 to allow commissioning of processing facilities in Q2 2025 and first gold production in Q3 2025
• Delivered on community development and local employment stakeholder programs
  • Local Cooperation Agreement for 2024 implemented supporting local development
  • Recruitment and training of Bayan Khundii mine workforce continued with eighth cohort of local residents selected for equipment operator training at MMC's UHG mine, for a cumulative total of 164 people undertaking the training
  • Company supported installation and improvement of three rural water wells to increase water availability for residents  

• Conducted 15,000-metre Bayan Khundii ore-control drill program
  • Drilled 89 shallow diamond drill holes totaling 1,048 metres focused on near-surface high-grade, scheduled to be developed in the first 3-4 months of mining and a further 10 holes totaling 456 metres to assist with future mine planning
  • Second phase of the program, in Q4 2024, consisted of 106 diamond core holes totaling 1,168 metres and 812 reverse circulation holes for 12,273 metres for which results were received subsequent to year end with highlights included below
  • Results confirmed high-grade domains in the current block model and indicated areas of expansion with highlight intersections of 101.0 g/t gold over 4 metres, starting 7 metres downhole and 115.1 g/t gold over 4 metres from 11 metres (see table below for greater than 20 gram*metre intersections)

• Completed 950 metre Bayan Khundii expansion program on the periphery of the planned open pit
  • Drilling intersected gold mineralization in all holes, demonstrating the potential for resource growth and pit extension
  • Results included the highest-grade drilling results to date in Striker West, adjacent to the Bayan Khundii open-pit, including 7.3 g/t gold over 42 metres, with multiple high-grade metre intersections of 15 to 79 g/t gold (BKD-377)
• Conducted surface sampling program at the Greater Dark Horse area and at Zuun Mod
  • Multiple samples from Greater Dark Horse returned high grade gold (up to 37.7 g/t Au) and silver (over 100 g/t Ag), providing targets for follow-up drilling
  • Discovered new gold prospect 4.5 km west of the Zuun Mod molybdenum-copper deposit
• Added Kelly Cluer as Technical Advisor to assist exploration team
  • Brings more than 30 years' experience including over a decade in Mongolia where he led the discovery and definition of two of the Country's largest gold deposits

• Closed strategic alliance with MMC on January 23, 2024
  • MMC invested US$40 million for a 50% equity interest in EM, the company holding the BK Project
  • Erdene retains a 50% equity interest in EM as well as a 5% NSR royalty on production after the first 400,000 ounces of gold production and a 100% interest in Zuun Mod
• Secured BK Project Finance from strategic partner MMC
  • Up to US$80 million shareholder loan to EM, the entity co-owned by Erdene and MMC
  • Five-year bullet maturity, bearing interest at 13.8% per annum, payable in arrears
  • Secured by Erdene's interests in EM and preferential rights over Erdene's properties
• Obtained US$50 million facility for BK from Trade and Development Bank of Mongolia
  • 24-month term and repayable in equal monthly payments during the final six months of the loan
  • Facility bears interest at 13.3% per annum and is secured by BK's process plant assets
• Recorded net loss of $8,245,886 for the year ended December 31, 2024, compared to net income of $522,043 for the year ended December 31, 2023
  • Exploration and evaluation expenses totaled $1,852,642 for the year ended December 31, 2024, compared to $847,010 in 2023, as certain salaries, consultant costs, and travel expenditures historically incurred by the associate EM were incurred directly following the close of the Strategic Alliance
  • Corporate and administrative expenses totaled $5,043,058 for the year ended December 31, 2024, compared to $3,137,735 for the year ended December 31, 2023, with the year-on-year change primarily due to the write-off of previously deferred project finance and other arrangement costs following termination of project finance diligence due to the Bayan Khundii shareholder loan with MMC, as well as the accrual of first gold bonuses for senior staff in the current year, and cost of living salary increases
  • Loss from investment in associate of $3,245,109 for the year ended December 31, 2024, compared to $2,278,370 in the prior year due to an increase in non-capitalized interest expenditures by EM following the February 2024 financing partially offset by Erdene's change in ownership following the close of the Strategic Alliance in Q1 2024
  • Non-cash gain on dilution of $1,256,598 in the year ended December 31, 2024 due to the close of the Strategic Alliance with MMC, compared to a gain on loss of control of EM of $6,544,863 upon the signing of the Strategic Alliance with MMC in January 2023 

During Q4 2024, EM completed the second phase of the ore-control drill program, designed to test near-surface gold mineralized zones, scheduled to be developed in the first four months of mining, and generally within 15 metres of surface. The program consisted of 106 diamond core holes totaling 1,168 metres and 812 reverse circulation holes for 12,273 metres. Results confirmed consistency of mineralization in the previously defined blocks and drilling in 10 areas intersected mineralization that has the potential to extend ore blocks. A further 100+ holes are planned to verify these newly identified areas.

The attached map displays results from the ore-control drilling program and shows holes that intersected greater than 0.30 g/t gold (~75% of holes) over one metre (projected resource cut-off grade) within this shallow drilling program. Holes with significant high-grade intersections, defined as exceeding 20 gram-metres (~12% of holes), are highlighted in red. Details of the intersections are provided in the table below.

The output from the ore-control drilling will be incorporated into a Bayan Khundii mine plan update over the coming months. The updated plan will also consider the impact of higher gold prices as the current economic pit was defined using a US$1,850-ounce gold price and a US$2,000-ounce pit constraining factor. At current gold prices of approximately US$3,000 per ounce, additional near-pit resources are likely to be incorporated in the updated mine plan.

Ore-Control Drilling Highlights

Intervals exceeding 20 gram-metres (interval multiplied by average gold grade)