Resource evaluation, environmental and hydrogeologic studies will be carried out in the first half of 2009 at Zuun Mod. The current focus is on revising the May 2008 resource estimate by incorporating the 2008 drilling data and developing all necessary data and supporting information for a Mining Licence application required to secure tenure for Zuun Mod over the longer term.
Drilling has defined at least two areas where mineralization begins within 50 metres of surface, with grades in the 0.07% to 0.09% Mo range over intervals between 60 and 80 metres. These zones display good horizontal and vertical continuity. Management expects to develop initial mine plans in these two areas before moving into higher-volume operations at grades of 0.05% to 0.06% Mo based on higher molybdenum prices.
Evaluations of the economics of such a plan will be carried out in 2009 and based on acceptable returns, a prefeasibility program plan will be prepared. During this period, molybdenum and steel markets will be evaluated to assess the proper time to more aggressively advance the project through to feasibility. Expenditures for the Zuun Mod project in 2009 will be limited to those needed to advance the project through these stages and provide the necessary information for the mining licence application.
Located within 200 kilometres of China’s border in Mongolia’s Bayankhongor Province, the Zuun Mod porphyry complex measures 12 kilometres in circumference and hosts broad zones of molybdenum mineralization. In a three-kilometre long portion of the system, referred to as the South Corridor, Erdene identified three mineralized zones known as the Racetrack North (“RTN”), Racetrack South (“RTS”) and the Stockwork zones. Initial drilling of these zones intersected thick intervals of significant mineralization proximal to surface and open at depth.
In May 2008, Erdene established Zuun Mod as one of the largest and most advanced pre-development molybdenum projects in the north Asia region, by receiving an initial National Instrument 43-101 compliant resource for the project from Minarco MineConsult of Sydney Australia. The Zuun Mod resource report can be viewed by clicking here.
Cut-off Grade Mo% |
Resource Category |
Resources Mt |
Cu% |
Mo% |
Contained Mo Metal Mlbs |
||
0.04% |
Inferred |
49.7 |
0.063 |
0.047 |
51 |
||
Indicated |
51.2 |
0.068 |
0.051 |
58 |
|||
Measured |
185.9 |
0.068 |
0.053 |
217 |
|||
Total Measured & Indicated |
237.1 |
0.068 |
0.052 |
272 |
|||
0.05% |
Inferred |
12.7 |
0.069 |
0.058 |
16 |
||
Indicated |
21.3 |
0.076 |
0.060 |
28 |
|||
Measured |
88.8 |
0.075 |
0.062 |
121 |
|||
Total Measured & Indicated |
110.1 |
0.075 |
0.061 |
148 |
Minarco MineConsult Resources Estimate Notes:
Effective Date: May 2008.
Mineral Resource estimates are not precise calculations.
Estimates are rounded to appropriate significant figures.
Grade modelling using Datamine Regular Block Model
Mo grade modelling using Multi Indicator Kriging (MIK)
Cu grade modelling using Inverse Distance interpolation (ID)
Contained Metal Mo is indicative only for Mineral Resources.
Contained Metal for Ore Reserves will be less due to application of modifying factors.
Following the release of the resource estimate the 2008 drill program was designed to define localized zones of higher grade mineralization, particularly those nearer surface, and to revise the resource estimate accordingly. A total of 32 new holes were completed and eight holes were deepened, totaling 10,785 metres.
The 2008 program was successful in defining localized higher grade zones and enlarging the overall deposit, both vertically and laterally. The deposit was confirmed to extend to depths exceeding 500 metres over a minimum strike length of 1.7 kilometres while locally coming to within 22 metres of surface. Drilling confirmed several continuous intersections exceeding 350 metres of 0.06% Mo and multiple high grade zones exceeding 50 metres of 0.10% Mo. A map displaying the location of all holes drilled in 2008 and a summary of all results can be viewed by clicking here. Minarco is currently working to revise the May 2008 resource estimate by incorporating the 2008 drilling data.
