HALIFAX, NOVA SCOTIA, Nov 28, 2011 (MARKETWIRE via COMTEX) -- Erdene Resource Development Corp. CA:ERD -8.75% ("Erdene" or "Company"), is pleased to announce that it has closed $1,715,000 of a private placement announced on November 16, 2011 and issued 4,287,500 shares at $0.40 per share. The offering was led by Mongolian International Capital Corporation ("MICC").
"We are tremendously pleased to receive the support of Mongolian shareholders, providing them with an opportunity to share in the excitement of what we believe is a significant new gold discovery at Altan Nar," said Peter Akerley, President and CEO. "This project is an important addition to our cornerstone Donkin Coal and Zuun Mod Molybdenum-Copper projects."
MICC, the broker for the transaction, is the oldest and leading full service investment bank in Mongolia, providing investment banking, equity research, securities underwriting, and brokerage services to Mongolian and international clients.
"Since the discovery of Oyu Tolgoi by Ivanhoe Mines, Mongolians have been eager to participate and share in the risks and rewards through investment in the mineral exploration sector" " said Achit Erdene Darambazar, President and CEO of MICC. "We are very pleased to have the opportunity to work with companies like Erdene which have the potential to create significant value for our clients and are serious about engaging local stakeholders".
All securities issued pursuant to the private placement are subject to a hold period expiring March 29, 2012. The Company paid a cash commission of $102,900 to MICC in connection with the closing of the financing.
Net proceeds of the Private Placement will be used for exploration of the Company's projects in Mongolia and working capital. Exploration expenditures will primarily be directed to the Altan Nar epithermal gold project. Initial drilling results from this discovery, announced on October 12, 2011, included 55 metres of 1.02 g/t gold and 12 g/t silver, including 23 metres of 2.07 g/t gold and 23 g/t silver in discovery-hole TND-09. A 3,000 metre, 18-hole drilling program was recently initiated to follow-up on the initial discovery and to test coincident geochemical-gold and geophysical anomalies in a 2 kilometre by 3 kilometre area (see press release dated November 10, 2011). To date, seven of the planned 18 holes have been completed, testing an area up to 600 metres north of TND-09. These holes have intersected multiple zones of sulphide-bearing epithermal breccias, similar to those intersected in the discovery hole.
Remaining drilling will test targets south from the discovery hole over a 500 metre strike length and additional geophysical targets to the northwest parallel to the discovery zone where surface rock samples returned in excess of 3 g/t gold. Drilling to date has concentrated on near surface mineralization (approximately 150 metres vertically) with geophysical anomalies and mineralized drill hole intersections open at depth and along strike. Initial samples have been delivered to the SGS laboratory which has a standard four to six week period to complete the analysis.
For more details on the Altan Nar project please visit Erdene's website at www.erdene.com to view the "Altan Nar Presentation" and recent core photos of sulphide-bearing epithermal quartz veins from TND-16 and TND-18, located 530 metres and 300 metres northeast of TND-09, respectively. These documents are available under the Featured Items section on the homepage.
Established in 2005, MICC is an experienced financial advisor to mining and mining services companies in Mongolia, and has managed initial public offerings and private placements for several Mongolia-focused resource companies on the Australian Stock Exchange, the Hong Kong Stock Exchange, and the Toronto Stock Exchange. MICC is regulated by the Financial Regulatory Commission of Mongolia and is a member of the Mongolian Stock Exchange.
Erdene Resource Development Corp. is a diversified resource company with multiple projects in Mongolia, Canada, and the USA, at various stages of development, from exploration to production; all projects are focused on high-growth commodities. These include a 25% interest in a large, high energy, coking and thermal coal resource located on the Atlantic Ocean in Eastern Canada partnered with Xstrata Coal. In Mongolia, Erdene's management have over 14 years of experience in the country's resource sector. A dedicated technical and management team has assembled a strong portfolio of molybdenum-copper, copper-gold, and coal projects throughout the country. These projects, and our in-country experience, provide the Company with a unique opportunity to participate in this period of unprecedented economic growth in Mongolia. This growth is fuelled by the discovery and development of a number of World-class mineral projects that are transforming the country into one of Asia's natural resource capitals.
Erdene has a current working capital position, including net proceeds of this offering, of $4.1 million, including that of its controlled subsidiary Advanced Primary Minerals Corp., with 94,610,877 common shares issued and outstanding and a fully diluted position of 102,218,877 common shares.
J.C. (Chris) Cowan, P. Eng. (Ontario) is a Qualified Person as that term is defined in National Instrument 43-101 and has reviewed and approved the technical information contained in this news release. Sample analyses have been carried out at SGS Laboratory in Ulaanbaatar, Mongolia. In addition to internal checks by SGS Laboratory, the company incorporates a QA/QC sample protocol utilizing prepared standards, blanks and duplicates.
Certain information regarding Erdene 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, guidance or other statements that are not statements of fact. Although Erdene believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Erdene cautions that actual performance will be affected by a number of factors, most of which are beyond its control, and that future events and results may vary substantially from what Erdene currently foresees. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration results, continued availability of capital and financing and general economic, market or business conditions. The forward-looking statements are expressly qualified in their entirety by this cautionary statement. The information contained herein is stated as of the current date and is subject to change after that date. The Company does not assume the obligation to revise or update these forward-looking statements, except as may be required under applicable securities laws.
NO REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE CONTENTS OF THIS RELEASE
Erdene Resource Development Corp.
Peter C. Akerley, President and CEO
Ken W. MacDonald
Vice President Business Strategy and CFO
SOURCE: Erdene Resource Development Corporation mailto:email@example.com
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