Erdene Resource Development Corporation announced results of recent exploration at the Dark Horse Gold prospect, part of the greater Bayan Khundii Gold Project. The Dark Horse Gold prospect is located approximately two kilometers north of the planned Bayan Khundii (BK) open-pit in the Khundii Minerals District, in southwest Mongolia. Erdene recently completed a shallow drilling and geophysical exploration program across the greater Dark Horse prospect at the Bayan Khundii Gold Project.

The program included an 18-hole scout exploration drilling campaign, totaling 1,040 metres, and a gradient array induced polarization (IP) geophysical survey covering nine-square kilometres over the core of the greater Dark Horse prospect. The program was primarily designed to test for near-surface oxide related gold mineralization, similar to the Dark Horse Mane deposit, and to identify targets for follow-up deeper drilling. The program identified multiple areas of near-surface, gold and indicator element anomalism, with 12 holes intersecting anomalous gold (greater than 0.1 g/t and up to 5.8 g/t Au) and 16 holes returning indicator element mineralization locally over wide intervals up to 55 metres.

Gold, together with antimony, arsenic and molybdenum, geochemical anomalies are characteristic of the Dark Horse deposit and were instrumental, in the initial discovery of high-grade, near-surface gold mineralization at the Dark Horse Mane. These results suggest gold mineralized hydrothermal fluids, carrying gold and other related elements, affect a wide zone within the greater Dark Horse area. Hole AAD-222 was a step-out from previous north-south trending trenches and drill holes that returned up to 70.2 g/t gold over 2 metres (AAD-12).

The intersection of mineralization in AAD-222 extends the area of known gold mineralization approximately 135 metres along trend to the southwest, increasing the gold mineralization strike length to 250 metres. Mineralization in this zone remains open along trend for hundreds of meters. Additionally, mineralization remains open at depth, with exploration to date testing to a maximum depth of 110 metres.

Hole AAD-226 was a near surface follow-up hole to AAD-110 that returned 7 metres of 1.46 g/t gold in the area of East Mane. Hole AAD-226 intersected near surface oxide gold mineralization above the previously intersected mineralization in AAD-110. The newly acquired gradient array IP data shows that the East Mane prospect is located along a strong north-south lineation, parallel to the Dark Horse Mane trend, that extends over 3 kilometres (the N-S width of the IP survey area).

This lineation may represent a previously unidentified N-S structure. Wide spaced drilling along this lineation, as well as rock and soil geochemical surveys, have returned gold and thick intersections of indicator element anomalism. Follow-up exploration will be undertaken later in the year.

Hole AAD-235 was drilled in the Altan Arrow area, where earlier drilling and trenching returned strong gold, silver and base metal mineralization along a 1.2-kilometre long NE trend. In addition to the gold mineralization, AAD-235 returned two metres averaging 65 g/t silver, 0.34% lead and 0.06% molybdenum (from 42 to 44 metres downhole). This combination of elements is more typical of deeper epithermal mineralization, closer to a possible porphyry center at depth in the untested northeast portion of the Khundii mining license.

Anomalous molybdenum mineralization in soil sampling extends along trend two kilometres to the northeast, an area that has not been drilled tested to date. A detailed gradient array IP survey, focusing on defining near surface (up to 100 metres depth) chargeability and resistivity targets, was completed over a nine square kilometre area, centered on Dark Horse Mane. The gradient array survey shows the major NE trend of structures, as well as a strong north-south trends, supporting the structural interpretation of extension zones opening along a set of NE trending major strike-slip faults, hosting north-south trends of mineralization identified at Dark Horse Mane.

A number of parallel zones with similar geophysical signatures to known mineralization at Dark Horse Mane have been identified. These areas are under tested or untested by drilling, including the strong north-south lineation through East Mane, intersected by AAD-226. Also of note are two north-south, elongated gradient array chargeability/resistivity anomalies, 400 and 700 metres, respectively, west of Dark Horse Mane South.

These zones have the same gradient array IP signature as Dark Horse Mane South and similarly lie just north of a major NE trending structure interpreted to be a deep-seated structure and likely conduit for mineralizing fluids. These new geophysical anomalies represent strong new exploration targets. Together with other geological and geochemical data, all zones of gradient array IP anomalism will be assessed and prioritized for future drilling.

The area of known gold mineralization within the Bayan Khundii Project area extends from Ulaan in the southwest, through the Bayan Khundii Gold Deposit and north throughout the greater Dark Horse prospect, covering an area of over 40 square kilometres. Gold mineralization is focused along northeast-southwest and related north-south structures, that acted as conduits for mineralized fluids from deep magmatic sources, potentially related to porphyry centers at depth. The variety of minerals associated with the gold mineralization, and the large area of mineralization, suggests either multiple magmatic/porphyry sources, varying depths of mineralization (with subsequent varying levels of uplift and erosion to expose different depths of mineralization at the current surface) or both.

The greater Dark Horse prospect (approximately 20 square kilometres) is located in the northern portion of the Khundii mining and Ulaan exploration licenses and is characterized by elevated gold in soil anomalism with multiple surface rock-chip, trench and drill core samples assaying greater than 1 g/t gold. Trace element anomalism, geophysical anomalies related to alteration and mineralization, structures interpreted to represent conduits for mineralizing fluids, and alteration signatures supporting an epithermal mineralization model characterize the greater Dark Horse prospect area. The Dark Horse Mane prospect is associated with a north-south trending, linear structural corridor which intersects deep seated northeast trending transform faults, believed to be a conduit for primary mineralizing fluids.