Erdene Gold Reports 2004 Year-End Financial Results

Outlines Exploration Plans for 2005

HALIFAX, May 2 /CNW/ - Erdene Gold Inc. (TSXV:ERD), a mineral exploration
company focused on Mongolia, today announced its year-end results for fiscal
2004.

Highlights for Fiscal 2004:
-   Raised $10.6 million in initial public offering in March 2004
-   Completed evaluation of eight projects including diamond drilling on
    three properties
-   Confirmed an extensive mineralized copper-gold porphyry system at
    Temuujin on the Virgin property
-   Extensive area of alteration and associated copper and gold
    mineralization identified at Wild Mountain
-   High grade gold intersections returned from Blue Springs drilling
-   Acquired key properties from Gallant Minerals, adding
    copper-molybdenum projects, early-stage gold and copper properties
    and a large uranium land package

"2004 was a transformational year for Erdene, marked by exploration
progress on all our original projects and the acquisition of several exciting
properties," said Peter Akerley, President and Chief Executive Officer. "We
identified significant gold and copper mineralization at Temuujin and Wild
Mountain, and have recently expanded our portfolio to include            
copper-molybdenum and uranium projects."
Erdene's strategy is to focus on the discovery of gold, copper and
molybdenum deposits in Mongolia with large bulk tonnage potential that are
amenable to open pit mining and sustainable for the long term.
"As an early entrant in Mongolia, Erdene has assembled a strong land
position in the country, which is ideally positioned to benefit from the
economic growth and increasing demand for minerals in neighbouring China,"
added Mr. Akerley. "Our goal in 2005 is to advance one or more of our core
properties to the resource definition stage while bringing some of the earlier
stage targets into the pipeline for 2006."

Erdene's five core properties include the following:
-   Zuun Mod porphyry copper-molybdenum project in southwestern Mongolia,
    where drilling is underway;
-   Temuujin copper-gold porphyry target, which will be tested by a
    deep-probing Titan geophysical program in the next few weeks designed
    to identify potential drill targets;
-   Erdenet Mine Area Property, where geophysical surveying has just been
    initiated;
-   Wild Mountain gold and copper prospect discovered in 2004, where
    extensive field investigations will begin in late June; and
-   19 uranium properties, where field evaluations have been underway
    since late April.

It is anticipated that drilling activities will continue in southwestern
Mongolia throughout May, testing targets at Zuun Mod and other targets in the
region. Results from current exploration on the remaining core projects will
be evaluated in late June to define additional programs, including drilling,
for later in the 2005 field season. Erdene will also carry out exploration in
2005 on a number of projects where early stage results warrant follow up
exploration. Erdene anticipates that it will identify drill targets on one or
more of these properties during the field season and periodically carry-out
scout drilling programs.
For a comprehensive review of Erdene's exploration results and plans,
please refer to the Company's 2004 Annual Report available on Erdene's web
site, www.erdene.com, or on SEDAR, www.sedar.com.

2004 Financial Overview
-----------------------
The loss for the year ended December 31, 2004 was $4,436,620 or $0.19 per
share, compared to $629,091 or $0.14 per share in the same period last year.
Included in the 2004 loss were $3,435,009 of exploration expenses from the
Company's 2004 exploration program on its eight, 100% owned Mongolian
properties and a $287,619 non-cash stock-based compensation charge. Total
expenses for the year ended December 31, 2004 were $4,634,201 compared to
$637,633 for the same period in the prior year.
Total assets at December 31, 2004 were $9,426,472 with $8,579,289 of this
amount represented by cash compared with total assets and cash position at
December 31, 2003 of $4,161,426 and $3,510,296 respectively. Shareholders'
equity at December 31, 2004 was $9,256,996 as compared with $4,085,615 at
December 31, 2003. The company had working capital of $8,487,724 as of
December 31, 2004 and no long-term debt.
The complete consolidated financial statements for December 31, 2004 and
related notes, as well as management's discussion and analysis, are also
available in the 2004 Annual Report on Erdene's web site, www.erdene.com, or
on SEDAR, www.sedar.com.

About Erdene Gold Inc.

Erdene Gold Inc. is a mineral exploration company focused on Mongolia
with over 20 precious and base metal projects that include 47 licences
covering in excess of 840,000 hectares, as well as 19 uranium licences and
applications covering more than 1.3 million hectares. Erdene is well funded
with a current working capital position of approximately CDN$7.3 million.
Erdene has 26,232,135 common shares issued and outstanding and a fully diluted
share position of 30,828,910 common shares. Erdene Gold Inc. trades on the TSX
Venture Exchange under the symbol ERD.

Forward-Looking Statements
Certain information regarding the Company 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 the Company 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. The Company
cautions that actual performance will be affected by a number of factors, many
of which are beyond the Company's control, and that future events and results
may vary substantially from what the Company 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 Company's 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 subject to change after
that date. Erdene disclaims any intention to update or revise this statement
of forward-looking information, whether as a result of new information, future
events or otherwise.

The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this news release.