Erdene Resource Development Corporation · TSX:ERD
Erdene Resource Development — Mongolia 2011 Investment Summit, Hong Kong
37 slides from Erdene Resource Development's conference presentation, Oct 26, 2011
Slide 1: Mongolia 2011 Investment Summit, Hong Kong
Mongolia2011 Investment Summit, Hong Kong Mike MacDonald Director of Exploration Mongolia October 26, 2011
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Certain information regarding Erdene ("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, guidan
Slide 3: Presentation Outline
PRESENTATION OUTLINE Corporate Overview Mongolian Projects Zuun Mod (Mo-Cu) Khuvan Khar (Cu-Ag) Nomin-Altan Nar (Au-Ag-Pb-Zn) Summary 3
Slide 4: Market Facts
Market Facts (Sep-9th, 2011) Capital Structure Share Performance Trading Info TSX: ERD 4,000,000.0 $2.0 $1.8 Shares Outstanding 90.3 M 3,500,000.0 $1.6 Volume (millions) 3,000,000.0 Shares Fully Diluted 97.9 M $1.4 Price (CAD) 2,500,000.0 Working Capital CDN ~$4.2 M (1) $1.2 2,000,000.0 $1.0 52 Week
Slide 5: Investment Highlights
Investment Highlights DONKIN PROJECT (25% ERD / 75% Xstrata) Pre-feasibility completed on 2.75 Mtpy coking coal project Strategically located near a deep water port in eastern Canada Among the lowest transport & operating costs in the industry ZUUN MOD MOLYBDENUM-COPPER PROJECT One of the largest mo
Slide 6: Donkin Coal Project
Donkin Coal Project 25% Erdene / 75% Xstrata Coal (Manager) Located on Deep Tidewater Significant Infrastructure in Place Exclusive Port Access Large Resource – Long Mine Life High Quality Coal (Coking & Thermal) Low Operating & Transportation Cost Experienced Workforce 6
Slide 7: Large Resource – Long Life
Large Resource – Long Life 20 year initial mine life based on saleable reserves only 48 Mt probable saleable Indicated Probable Mineable Probable Saleable Inferred reserves Seam Resource (Mt) Reserve Reserve Resource (Mt) (Mt) (Mt) Lloyd Cove 53 n/a n/a 82 Project economics are Hub 73 28 23 57 based
Slide 8: Pre-Feasibility Study Completed
Pre-Feasibility Study Completed June 2011 (Marston & Marston) Production rate of 2.75 Mt of saleable coal Financial Parameters (C$) Production rate of 2.75 FOB Cash Cost / Tonne Mtpy of saleable coal $51.8 (avg. over LOM) Capital Expenditure $497 M High recovery (yield) of Peak Funding $331 M 81% In
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Slide 10: Erdene - Mongolia
ERDENE - MONGOLIA Principals working in Mongolia since 1996 Executive have >30 years of combined experience in Country Erdene formed in 2002 to focus on Mongolia Acquired Gallant Minerals (Zuun Mod) in 2005 Partnered with Xstrata on coal in 2006 Employ 14 full time and up to 100 seasonal personnel i
Slide 11: Mongolian Exploration Summary
Mongolian Exploration Summary Significant Holdings Near a Massive Global Consumer Zuun Mod Mo-Cu New Au-Ag-Cu-Pb- Xstrata Deposit Zn Discoveries JV Khuvyn Khar Altan Nar Located on One of the Coal the Chinese- largest Mo- New high New Au-Ag- exploration Mongolia Cu deposits grade Cu-Ag Pb-
Slide 12: Mongolia Coal Xstrata Alliance
Mongolia Coal Xstrata Alliance PRIORITY TARGETS: High Quality Thermal & Coking (open pit, <5:1, 200 Mt+, >5800 kcal/kg GAR) XSTRATA TERMS: • Option to earn up to 75% of any coal opportunity in Mongolia • Must fund all work through to completion of feasibility study WORK PROGRAM: • Xstrata has invest
Slide 13: Zuun Mod Mo-Cu Project
Zuun Mod Mo-Cu Project Infrastructure Building 13
Slide 14: Zuun Mod Mo-Cu Project
Zuun Mod Mo-Cu Project Molybdenum and Copper Highlights Located on the China border, next to the world’s largest base metals and steel producing markets Image/map... Sexy shot of ZM High grade Cu-Mo zone discovered perhaps in 2010 Access to lower capex plant and equipment Growing local infrastructur
Slide 15: Zuun Mod Mo-Cu Project: June 2011 Resource Estimate
Zuun Mod Mo-Cu Project June 2011 NI 43-101 Resource Estimate Resource Mo Grade Cu Grade Contained Contained Category Tonnage (Mt) (% Mo) (% Cu) Mo (M lbs) Cu (M lbs) M&I 218 0.057 0.069 273.5 330.7 Inferred 168 0.052 0.065 191.8 240.5 15
Slide 16: Zuun Mod Cross Section
Zuun Mod Cross Section 2010 Drilling Highlights Legend Zone of higher grade copper (highlighted in red below) Hole Interval Mo Grade Cu Grade ZMD-51 ext 432 m 0.061% 0.072% including 118 m 0.106% 0.098% 2010 Drill Program ZMD-115 300 m 0.071% 0.110% Highlights including 66 m 0.108% 0.129% ZMD-116 33
Slide 17: Zuun Mod – Project Status
Zuun Mod – Project Status Mining Licence - granted Resource estimate - registered with gov’t Hydrogeological study - completed Mongolian Feasibility study – submitted to gov’t Pit optimization study - in progress Metallurgical studies - in progress Environmental impact study- in progress Pre-Feasibi
Slide 18: Zuun Mod Regional Target Areas
Zuun Mod Regional Target Areas Khuvyn Khar Cu-Ag Discovery Limited Drilling of Large Zuun Mod Mineral Complex Copper in Soil Anomaly Large mineralized Khuvyn Khar annular feature - Cu-Ag 12km circumference; Discovery ~ 80% of drilling over ZM deposit Cu in soil anomaly Zuun Mod Mo-Cu deposit 1 km 18
Slide 19: Khuvyn Khar Cu-Ag Discovery
Khuvyn Khar Cu-Ag Discovery Copper in soil anomaly with drill highlights Cu in Soil Anomaly 373m of 0.19% Cu (34m of 1.3% Cu & 9.24g/t Ag) 118m of 0.08% Cu ZMD-08 ZMD-121 152m of 0.16% Cu (32m of 0.22% Cu) 298m of 0.12% Cu KKMD-13 ZMD-128 Drill Hole 278m of 0.13% Cu 500 m (42m of 0.21% Cu) 19
Slide 20: Altan Nar Discovery
Altan Nar Gold & Base Metal Discovery Regional Location N Shinejinst coal deposit Tsenkher Altan Nar Nomin Discovery License Khuvyn Khar Voyager’s Cu-Ag Discovery Cu-Au Cughur Discovery ERD License 25 km Zuun Mod Deposit 20
Slide 21: Nomin Tal
Nomin Tal • Ancient pits with Cu-Au discovered during regional exploration Step-out drill • Initial 6-hole drill program confirms hole 600 m N 150 m strike length with multiple of initial narrow, steeply dipping, parallel drilling zones of high-grade Au-Ag-Cu massive sulphide-magnetite • Mineralizat
Slide 22: Altan Nar: Gold in Soil
Altan Nar Gold & Base Metal Discovery Gold in Soil N Ancient copper-gold pits – initial ERD drilling 1,430 ppb (1.4g/t gold) 467 ppb (0.47g/t gold) 2 km 22
Slide 23: Altan Nar: Gold & Base Metal in Rock – Highlights
Altan Nar Gold & Base Metal Discovery Gold & Base Metal in Rock – Highlights N Rock chip sample Prospect outline 3.2 g/t Au 2.2% Cu 19 g/t Au 12 % Pb 5.2 g/t Au 3.2% Cu 11 g/t Au 2.6% Cu 41 g/t Au 11 % Pb 1% Zn 0.35% Mo 1.7% Cu 14% Cu 2 km 23
Slide 24: Altan Nar: Gold in Soil Overlain by Gold in Rock
Altan Nar Gold & Base Metal Discovery Gold in Soil Overlain by Gold in Rock - Highlights N IP Gradient Array & Magnetics Boundary 19 g/t Au 9.5 g/t Au 7.5 g/t Au 1.96 g/t Au 6.4 g/t Au 11.2 g/t Au 41.3 g/t Au 5.8 g/t Au 2 g/t Au 1 km Rock chip sample 24
Slide 25: Altan Nar: Lead in Soil Overlain by Lead in Rock
Altan Nar Gold & Base Metal Discovery Lead in Soil Overlain by Lead in Rock - Highlights N IP Gradient Array & Magnetics Boundary 1.5% Pb 1.3% Pb 0.6% Pb 10.5% Pb 2.5% Pb 1.8% Pb 1 km 1 km Rock Rock chip chip sample sample 25
Slide 26: Altan Nar: Zinc in Soil Overlain by Zinc in Rock
Altan Nar Gold & Base Metal Discovery Zinc in Soil Overlain by Zinc in Rock - Highlights N IP Gradient Array & Magnetics Boundary 1.5% Zn 0.7% Zn 3.1% Zn 2.2% Zn 1.6% Zn 1.2% Zn 1 km Rock chip sample 26
Slide 27: Altan Nar Drill Plan
IP Gradient Array Chargeability Altan Nar Drill Plan TND-12 TND-11 Drill collar Dipole-Dipole Plane with drill path Rock chip sample (g/t gold) TND-10 TND-09 IP Dipole-Dipole Line Drill Collar 100m 500m 27
Slide 28: Altan Nar Drill Plan
RTP Magnetics Altan Nar Drill Plan TND-12 TND-11 Drill collar with drill path Rock chip sample (g/t gold) TND-10 TND-09 Drill Collar 100m 500m 28
Slide 29: Altan Nar: IP Dipole-Dipole on Gradient Array
Altan Nar Gold & Base Metal Discovery IP Dipole-Dipole on Gradient Array Dipole-Dipole Line 3 Dipole-Dipole Line 2 Dipole-Dipole Line 1 29
Slide 30: Altan Nar: IP Dipole-Dipole with Drill Trace
Altan Nar Gold & Base Metal Discovery IP Dipole-Dipole with Drill Trace (looking Northeast) Down Hole Au >0.5g/t Targeted Chargeability 30
Slide 31: TND-09 Looking NW to TND-10
TND-09 Looking NW to TND-10 Altan Nar Quartz Breccia Cutting Andesite Phyllic Alteration of Andesitic Tuff Brecciated-Altered Andesite
Slide 32: Quartz Breccia Cutting Andesite
Quartz Breccia Cutting Andesite Quartz Breccia Massive Galena and Sphalerite Pyrite & Chalcopyrite in Quartz Breccia
Slide 33: Altan Nar Drill Section TND-09, -10
Altan Nar Drill Section TND-09, -10 NW 25m 40m of 0.32g/t Au and 3 g/t Ag; including 4m of 0.96 g/t Au and 12 g/t Ag 55m of 1.02g/t Au, 12g/t Ag, 0.26% Pb & 0.5% Zn; including 23m of 2g/t Au & 23g/t Ag; with 8m of 3.90 g/t Au and 17 g/t Ag 33
Slide 34: Altan Nar Drill Section TND-11
Altan Nar Drill Section TND-11 25m SW 18m of 0.56g/t Au, 6g/t Ag and 0.50% Zn; including 2m of 1.24g/t Au, 17 g/t Ag & 0.60% Zn 34
Slide 35: Altan Nar Drill Section TND-12
Altan Nar Drill Section TND-12 25m SW 21m of 1.5% Zn and 0.4% Pb 48m of 0.51g/t Au; including 10.5m of 1.20g/t Au, 16g/t Ag and 0.41% Zn 35
Slide 36: Summary
Summary Erdene Resource Development Corp. Developing a large export coking coal project with Xstrata Advancing a major Mo-Cu project on the China-Mongolia border Initial drilling completed at Altan Nar Au-Ag- Pb-Zn discovery, additional geophysics and geochemistry in progress – additional drilling p
Slide 37: TSX: ERD
TSX: ERD
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