Vancouver, B.C., July 21, 2021 – Entrée Resources Ltd. (TSX: ETG; OTCQB: ERLFF – the “Company” or “Entrée”) is pleased to announce that it has today filed a National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) technical report (“Report”) titled “Entrée/Oyu Tolgoi Joint Venture Project, Mongolia, NI 43-101 Technical Report” on its interest in the Entrée/Oyu Tolgoi joint venture property in Mongolia (“Entrée/Oyu Tolgoi JV Property”). The Report has an effective date of May 17, 2021 and is available on SEDAR at www.sedar.com and on the Company’s website. The Report relates to the press release announced by the Company on June 15, 2021.
The Report discusses an updated Feasibility Study (“2021 Reserve Case”) based on mineral reserves attributable to the Entrée/Oyu Tolgoi joint venture (“Entrée/Oyu Tolgoi JV”) from the first lift (“Lift 1”) of the Hugo North Extension copper-gold deposit. Lift 1 of Hugo North (including Hugo North Extension) is currently in development by project operator Rio Tinto as an underground block cave with first development production from Hugo North Extension expected in 2022. Entrée has a 20% or 30% participating interest (depending on the depth of mineralization) in the Entrée/Oyu Tolgoi JV with Oyu Tolgoi LLC (“OTLLC”) holding the remaining 80% or 70% interest. The 2021 Reserve Case after-tax NPV(8%) for Hugo North Extension Lift 1 attributable to Entrée is US$114 million*.
The Report also includes a Preliminary Economic Assessment (“2021 PEA”) on a conceptual second lift (“Lift 2”) of the Hugo North Extension deposit. The 2021 PEA after-tax NPV(8%) for Hugo North Extension Lift 2 attributable to Entrée is US$306 million*. The 2021 PEA is based on Indicated and Inferred mineral resources from Lift 2 as the second potential phase of development and mining on the Hugo North Extension deposit. Production and cash flows from the 2021 Reserve Case and the 2021 PEA are from separate parts of the Hugo North Extension deposit and there is no overlap in the mineral reserves from the 2021 Reserve Case and the mineral resources from the 2021 PEA.
The Entrée/Oyu Tolgoi JV Property comprises a significant portion of the long-life, high-grade Oyu Tolgoi copper-gold mining project, as well as hosting several strong exploration prospects with the potential for near-surface porphyry and epithermal-style copper and/or gold mineralization. By 2030, Oyu Tolgoi is expected to be the fourth largest copper mine in the world.
*Long term metal prices used in the net present value economic analysis are: copper US$3.25/lb, gold US$1,591.00/oz and silver US$21.08/oz.
The economic analysis in the 2021 PEA is based on a conceptual mine plan and does not have as high a level of certainty as the 2021 Reserve Case. The 2021 PEA is preliminary in nature and includes Inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the 2021 PEA will be realized. Mineral resources are not mineral reserves and do not have demonstrated economic viability.
Both the 2021 Reserve Case and the 2021 PEA are based on information supplied by OTLLC or reported within OTLLC’s 2020 Oyu Tolgoi Feasibility Study (“OTFS20”). Neither OTFS20 nor the results of the 2021 Reserve Case and 2021 PEA reflect the impacts of the COVID-19 pandemic, which are ongoing and continue to be assessed by OTLLC. Reference should be made to the full body of the Report for the assumptions, qualifications and procedures underlying the reported results, which are not fully described herein.
The Report was completed independently by Wood Canada Limited.
Robert Cinits, P.Geo., formerly Entrée’s Vice President, Corporate Development and now a consultant to the Company, is a Qualified Person as defined by NI 43-101 and has approved the technical information in this release.