Slide 1: Asia Mining Congress 2009
ASIA ASIA MINING MINING CONGRESS CONGRESS 2009 2009 PETER AKERLEY President President & & CEO CEO
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: Sustaining Growth and Maintaining Stability
Sustaining Growth and Maintaining Stability Diversification: Selecting specific commodities and regions Balance: Maintaining an ideal mix of projects at various stages of development Timing: Introducing a project to potential partners – the Zuun Mod Molybdenum Project Partnerships: Update on partner
Slide 4: Erdene
EXD 1S cr rcle iat on ati fic iversi d
Slide 5: Project Locations
Project Locations INDUSTRIAL MINERALS METALS COAL GOLD TARGET COUNTRIES 5
Slide 6: World Coal Markets
WORLD COAL MARKETS Erdene’s Coal Project Locations Donkin, Xstrata/ERD Alliance 25:75 ERD- Mongolia Xstrata JV Nova Scotia Consumption: China Consumption: China Consumption: US Consumption: US (Mt) 4215 (Mt) 1402 2457 981 Erdene Properties 2006 2030 Top Consumers Top Exporters 2006 2030 Source: Ener
Slide 7: Construction Aggregate
CONSTRUCTION AGGREGATE U.S. Population Increase through 2030 AGGREGATE CONSUMPTION AVERAGES 9 TONNES PER PERSON PER ANNUM Secondary Market Target DELA. Population Population 29.2% Growth Growth N.C. >10M 51.9% S.C. 1M – 10M 28.3% GA. 500K – 1M TX. 46.8% 250K – 500K FLA. 100K – 250K Primary 79.5% Mar
Slide 8: Zuun Mod Mo-Cu Project Location
Zuun Mod Mo-Cu Project Location Regional Molybdenum Consumption & Steel Production Gas Pipeline 22 Mlbs Mo World’s Largest Steel Producing Region China’s Largest Molybdenum Producing Regions
Slide 9: Gold
GOLD WEAKER DOLLAR QUANTITATIVE EASING INFLATION GOLD EXPLORATION IN MONGOLIA GLOBAL GOLD EVALUATION COUNTRIES AND REGIONS SELECTED OPPORTUNITIES BEING EVALUATED
Slide 10: Erdene Balance
Erdene balance
Slide 11: Balance
Balance Exploration - Development Stage Production 8 to 10 Brownfields5 to 7 Eastern Canada Construction Materials Greenfields2 to 4 Global Precious Metal Evaluation Conceptua 1 Mongolia Coal Program (Partnered 25%) Mongolia Metals Project Erdenet Copper Project Galshar Coal Project (Sold-Royalty) Z
Slide 12: Erdene Timing
Erdene timing
Slide 13: Balance
Balance Production 8 Exploration to 10 - Development Stage Brownfields5 to 7 Eastern Canada Construction Materials Greenfields2 to 4 Global Precious Metal Evaluation Conceptua 1 Mongolia Coal Program (Partnered 25%) Mongolia Metals Project Erdenet Copper Project Galshar Coal Project (Sold-Royalty) Z
Slide 14: Metals: Molybdenum & Copper
METALS: MOLYBDENUM & COPPER Target: >300Mlbs of molybdenum grading ~0.06% Mo, equal copper, open pit mining Market: Asia-Pacific region ~35% of world consumption and fastest growing Project: Zuun Mod: Wholly owned; advanced stage; ~200km from China border and rail 14
Slide 15: Zuun Mod
ZUUN MOD Infrastructure Building 15
Slide 16: Zuun Mod Deposit – Block Model
Zuun Mod Deposit – Block Model Total 0. 0. 110. Measured & 07 06 1 148 Indicated 5 1 Contained Cut-off Resources Resource Category Cu% Mo% Mo Metal Grade Mo% Mt Mlbs Total 0.04% 237.1 0.068 0.052 272 Measured & Indicated Total 0.05% 110.1 0.075 0.061 148 Measured & Indicated
Slide 17: Zuun Mod Project Status
ZUUN MOD Project Status September 2008 Drill Results 410m of 0.057% Mo (96m 0.095%) Revised resource estimate report 399m of 0.055% Mo in Q2 2009 Preliminary (36m 0.088%) assessment study 428m of 0.060% Mo Q2 2009 (172m 0.091%) Mining license 373m of application 2009 0.063% Mo (94m 0.084%) Mineraliz
Slide 18: Zuun Mod Timeline
ZUUN MOD Timeline 2008 2009 2010 2011 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Resource Definition Preliminary Assessment Study Mining License Application Prefeasibility Strategic Partner Evaluation Feasibility Development Start-up 18
Slide 19: Molybdenum Market Outlook
Molybdenum Market Outlook Need for new suppliers 2Q08 Forecast d Deman Global $/lb Mo 1Q09 Forecast
Slide 20: Zuun Mod Summary
ZUUN MOD SUMMARY One of the largest molybdenum deposits in Asia On the doorstep of the world’s largest steel producing region Established >300 Mlbs of molybdenum resource Updated resource estimate Q2 2009 Preliminary assessment study Q2 2009 20
Slide 21: Erdene Partnerships
Erdene partnerships
Slide 22: Donkin Project
Donkin Project Xstrata 75%-ERD 25% 254 Mt 12,000 to 14,000 btu 227Mt 12,000 to 14,000 btu
Slide 23: Donkin Coal Project – Local Infrastructure
DONKIN COAL PROJECT Local Infrastructure No. 26 Colliery 23
Slide 24: Donkin Coal Project – Coal Quality vs. Competition
DONKIN COAL PROJECT Coal Quality vs. Competition Average Coal Quality – World Coal Resources 16,000 15,000 14,000 13,000 12,000 BTUs 11,000 10,000 9,000 8,000 7,000 Indonesia South Russia Venezuela Cerrejon, Powder Central North Donkin Africa Colombia River Appalachian Appalachian Basin 24
Slide 25: Mongolia Coal 2008 Alliance
MONGOLIA COAL 2008 Alliance Erdene Gold Inc. – Xstrata Coal Xstrata Terms Option to earn up to 75% of any coal opportunity in Mongolia Must fund all work through to completion of feasibility study Priority Targets High Quality Thermal & Metallurgical (open pit, <5:1, 200Mt+, >5800 kcal/kg GAR)
Slide 26: Galshar Thermal Coal Project
Galshar Thermal Coal Project RUSSIA CHITA Project Sold late 2008 - Retained Royalty Adjacent to Trans- Mongolian Railway DARHAN 65 km to Trans-Mongolian Sharyn Gol Rail spur CHOYBALSAN ULAANBAATAR Large Open Pit Baganuur Opportunity BARUUN-URT 15m Seam Eldev Galshar Galshar 5000 to 5500 kcal CV ad A
Slide 27: Construction Aggregate: East Coast Target Markets
CONSTRUCTION AGGREGATE East Coast Target Markets Eastern Canada Projects 50% increase in aggregate imports to SE U.S. ports from 2002 to 2006 Canada provides ~42% of SE e L in U.S. international imports ll Source: USGS Fa Marine Transport Advantage Granite Hill, Central Georgia Mode Cost/tonne/mile
Slide 28: Construction Aggregate: Southeast US Projects
CONSTRUCTION AGGREGATE Southeast US projects Ready Mix USA Royalty Agreement Granite Hill Augusta Charleston Savannah Jacksonville Railroad (owner) CSTX FEC Tampa Clearwater NS CASH FLOW PENDING Miami PRODUCTION DECISION 2009 28
Slide 29: Advanced Primary Minerals
ADVANCED PRIMARY MINERALS (APD TSX-V 65% owned by ERD)
Slide 30: Industrial Minerals: Southeast US Projects
INDUSTRIAL MINERALS (APM Corporation) Southeast US projects Dearing Plant: Ceramic and Toll Processing of Industrial Minerals; Commissioning expected 4th qtr 2009 Augusta Charleston McDuffie Kaolin Deposits:~8M tonnes Savannah of high quality primary kaolin Hancock Deposits:~5M tonnes of high Jackso
Slide 31: Project Overview – Sustaining Growth
PROJECT OVERVIEW – Sustaining Growth Timeline 2008 2009 2010 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Continuous Continuous Miner Continuous Miner Production Donkin Miner Construction Longwall Feasibility Study Feasibility Updated Preliminary Strategic Mining License / Zuun Mod Resource Assessment Prefeasibili
Slide 32: Sustaining Growth and Maintaining Stability
Erdene Sustaining Growth and Maintaining Stability = value creation
Slide 33: Erdene Market Facts
ERDENE MARKET FACTS Shares Trading Info: Working Capital: Website Outstanding: TSX:ERD 89.2 M Cdn ~$17.2 M www.erdene.com Market Market Capitalization Capitalization (CDN$) (CDN$) 120.00 100.00 80.00 CDN $ M 60.00 40.00 20.00 0.00 27-Feb 30-Jul 31-Dec 31-May 31-Oct 31-Mar 31-Aug 30-Jan 30-Jun 30-Nov
Slide 34: 2009 AMC Sustainability Award Nomination – Community Development
2009 AMC Sustainability Award ERD Nomination – Community Development Setting the tone for responsible mineral exploration… Generating mutual benefits… Integrating business and social development… Investing in people who make a difference… Immediate impacts in the community…
Slide 35: Thank You
Thank You ASIA ASIA MINING MINING CONGRESS CONGRESS 2009 2009