Erdene Announces Q1 2024 Results and Provides Bayan Khundii Gold Project Update - Seite 2

• Completed 2024 exploration program planning for the Khundii Minerals District
  • Near-term focus on mine geology for Bayan Khundii and near-pit expansion opportunities
  • Planning completed for follow-up drilling at Zuun Mod to confirm resources in advance of planned Preliminary Economic Assessment
• Field program commenced in early Q2 on high priority targets within the KMD, including mapping and surface sampling to ground-truth drill targets

Corporate

• Closed Strategic Alliance on January 23, 2024 to advance construction of BK Project
  • MMC invested US$40 million for a 50% equity interest in EM, the company holding the BK Project
  • Erdene retains a 50% equity interest in EM as well as a 5% NSR royalty on production from the Khundii District after the first 400,000 ounces of gold production and 100% interest in Zuun Mod
• Secured BK Finance from strategic partner MMC
  • Up to US$80 million shareholder loan to EM, the entity co-owned by Erdene and MMC
  • Five-year bullet maturity, bearing interest at 13.8%, payable in arrears
  • Secured by Erdene’s interests in EM and preferential rights over Erdene’s properties
• Recorded a net loss of $2,678,373 for the three months ended March 31, 2024, compared to a net income of $5,405,927 for the three months ended March 31, 2023
  • Exploration and evaluation expenses totaled $783,156 for the three months ended March 31, 2024, compared to $66,827 for the same quarter in 2023, with the increase from the comparative prior year period primarily due to the timing of annual staff performance bonuses and stock option grants, which were incurred in the current quarter compared to the second quarter of 2023
  • Corporate and administrative expenses totaled $2,777,588 for the three months ended March 31, 2024, compared to $580,111 for three months ended March 31, 2023, with the change from the prior year comparative quarter resulting from the recognition of financing costs following the close of the BK project loan in Q1 2024 as well as the timing of annual staff performance bonuses and stock option grants, which were incurred in the current quarter versus Q2 2023
  • Non-cash gain on dilution of investment in associate of $1,070,737 with the issuance of equity in EM to MMC on January 23, 2024, compared to a gain of $6,544,863 in the first quarter of 2023, following the loss of control of EM due to the Strategic Alliance with MMC
  • Loss from investment in associate of $257,016 for the three months ended March 31, 2024, compared to a loss from investment in associate of $564,206 for the three months ended March 31, 2023, with the period over period change primarily due to a 50% reduction in Erdene’s ownership of EM during the current period with the close of the Strategic Alliance.

Qualified Person