The mining license for the Bayan Khundii Gold Project in southwest Mongolia covers 2,309ha
Canadian resource company Erdene Resource Development has secured a mining license for its 100% owned Bayan Khundii Gold Project in southwest Mongolia from the Mineral Resource and Petroleum Authority of Mongolia (MRPAM).
The mining license for the Bayan Khundii Gold Project, which covers 2,309ha, includes the Bayan Khundii resource, Altan Arrow, Khundii North, and Khundii West targets.
According to Erdene, the mining license for the Mongolian gold project is valid for an initial term of 30 years which can be extended to 70 years.
The Canadian miner holds an exploration license for the remaining 2,205ha of the legacy Bayan Khundii exploration license. The company said that this acreage was not converted to a mining license as part of its application with the MRPAM.
Discovered in 2015, Bayan Khundii has a total mineral resource of 751,000 ounces gold in the measured and indicated category at an average grade of 2.3 g/t gold, along with 291,000 ounces gold in the inferred category at an average grade of 1.8 g/t gold.
Bayan Khundii Gold Project details
The Bayan Khundii and Altan Nar projects are part of the Khundii Gold District discovered by Erdene, which is made up of multiple high-grade gold and gold/base metal prospects. The Bayan Khundii and Altan Nar gold deposits make up the Khundii Gold Project.
Erdene president and CEO Peter Akerley said: “With the mining license in hand, we are focused on completing the NI 43-101 Pre-Feasibility Study (“PFS”), Mongolian Feasibility Study, Environmental and Social Impact Assessment (“ESIA”) and Mongolian Detailed Environmental Impact Assessment (“DEIA”) for the Khundii Gold Project in 2019.
“Work is well progressed on the PFS, with preliminary results received for the resource estimate, mining, geotechnical, metallurgical, processing, waste rock and hydrogeological workstreams.
“We are rapidly advancing towards initial production of 50,000 ounces per year, while continuing to expand resources through exploration and acquisition within the Khundii Gold District.”
The Bayan Khundii license has a net smelter returns royalty (NSR Royalty) of 2% in favour of Canadian gold royalty company Sandstorm Gold with a buy-back option to bring down the NSR Royalty to 1.0%.