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Erdene Provides Notice to Buyback Sandstorm Gold’s Khundii Gold Project Royalty
HALIFAX, Nova Scotia, March 26, 2019 (GLOBE NEWSWIRE) -- Erdene Resource Development Corp. (TSX:ERD; MSE:ERDN) ("Erdene" or the "Company") is pleased to announc
About this update from Erdene Resource Development Corporation
[{"type":"text","content":" HALIFAX, Nova Scotia, March 26, 2019 (GLOBE NEWSWIRE) -- Erdene Resource Development Corp. (TSX:ERD; MSE:ERDN) (\"Erdene\" or the \"Company\") is pleased to announce its intention to repurchase a 1% net smelter return royalty (“NSR”) from Sandstorm Gold Limited (“Sandstorm”) on its Khundii Gold Project in southwest Mongolia by April 14, 2019 for C$1.2 million. “Considering the results of our recent Preliminary Economic Assessment and the exploration potential of the Khundii Gold Project license area, the fair value of the 1% NSR is well in excess of the repurchase price. Buying back the NSR will create significant value for our shareholders,” said Peter Akerley, Erdene’s President and CEO. “We would like to acknowledge Sandstorm’s support during the formative stages of the Khundii Gold Project and look forward to continuing to work with them as we move toward production.” As announced on April 21, 2016, Erdene completed a transaction granting Sandstorm a 2% NSR royalty on a select area that included the Khundii Gold Project as part of a C$2.5 million financing transaction. This transaction provided Erdene with a three-year option to buy back 50% of the 2% NSR Royalty for C$1.2 million. Erdene will fund the repurchase from cash on hand. Review of Khundii Gold Project Development 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 (the “Project”). The Company delivered the Project’s maiden mineral resource estimate in Q3 2018 with a Measured and Indicated (“M&I”) resource of 751,000 ounces (“oz”) gold at an average grade of 2.3 g/t gold and an Inferred resource of 291,000 oz gold at an average grade of 1.8 g/t gold (cut-off grade of 0.7 g/t gold). This was followed by a National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) Preliminary Economic Assessment in December 2018 which returned an after-tax Net Presen...