Erdene Resource Development Corporation press release

Erdene Announces Preliminary Economic Assessment Results for Zuun Mod Molybdenum-Copper Project

2026-10-14

TSX - Toronto Stock Exchange · Gold · Silver · Lead · Zinc · Molybdenum · Antimony · Copper · Canada · Technical Studies

Highlights

Base Case after-tax Net Present Value of US$745 million (NPV8%) and 16.1% Internal Rate of Return (IRR) based on long-term commodity price assumptions of US$25.00/lb molybdenum and US$5.00/lb copper After-tax NPV8%sensitivity of US$2.0 billion and 27.8% IRR at spot prices of US$33.00/lb molybdenum and US$6.50/lb copper 34-year mine life, with estimated recovered metal of 672 million pounds (305 kt) of molybdenum and 947 million pounds (430 kt) copper Upfront capital costs of US$687 million All-in sustaining cost (“AISC”) of US$13.89/lb molybdenum Estimated Life of Mine undiscounted Earnings Before Interest, Taxes and Depreciation of US$7.1 billion, increasing to US$13.0 billion at spot metal prices Significant interest in long-term offtake from Asian customers given strategic location approximately 280 km from railhead on the Mongolia-China border Multiple targets for resource expansion across the 6,041 hectare license hosting Zuun Mod and the Khuvyn Khar copper prospect Project positioned to leverage recently developed regional infrastructure investments in Khundii Minerals District and Southwestern Mongolia

HALIFAX, Nova Scotia, Oct. 14, 2026 (GLOBE NEWSWIRE) -- Erdene Resource Development Corp.(TSX:ERD; MSE:ERDN) ("Erdene" or the "Company") is pleased to announce results of an independent Preliminary Economic Assessment (“PEA”) for the wholly-owned Zuun Mod Molybdenum-Copper Project (“ZM” or "Project”) in southwest Mongolia. The PEA was prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) by a consortium of International and Mongolian firms with significant experience operating in Mongolia and internationally, led by O2 Mining Limited. Pursuant to NI 43-101 guidelines, the full technical report will be filed on SEDAR+ (www.sedarplus.ca) within 45 days of this news release.

The Company will host a webcast regarding the PEA on October 15, 2026 at 9:00 am EST. Participants can register to attend at the following link HERE.

Quotes from the Company:

Peter Akerley, Erdene's President and CEO, stated, "This PEA confirms Zuun Mod as one of the world's premier undeveloped resources of molybdenum. The project is underpinned by a low-strip-ratio open pit, located 35 kilometres from our Bayan Khundii Gold Mine and approximately 200 kilometres from the border with China, the world's largest consumer of molybdenum and copper. The project demonstrates compelling economic potential under our base case scenario with significant upside at current metals prices. Rapid infrastructure development across southwestern Mongolia, including new roads and expanded power supply, further support the potential viability of the project."

Mr. Akerley continued, "Molybdenum is essential to high-strength steel used in energy infrastructure, aerospace and defense. Demand continues to outpace supply, with little new primary production planned globally. Zuun Mod is expected to produce approximately 20 million pounds of molybdenum and 28 million pounds of copper per year over a 34-year mine life. The Project is well positioned to become the next major molybdenum producer in the region."

Mr. Akerley concluded, "Building on this study, drilling will begin in late October focused on upgrading and expanding a resource that remains open and to test for copper mineralization across the broader porphyry system. Engineering, environmental and hydrogeological programs will advance concurrently, and we are in discussions with potential partners on pathways to take Zuun Mod into development. We look forward to updating stakeholders as this work progresses."

Key Technical Information for the NI 43-101 Preliminary Economic Assessment

The Zuun Mod Molybdenum-Copper Project is a porphyry style deposit located in southwest Mongolia on Erdene’s wholly-owned Khuvyn Khar license. This project is located approximately 950 kilometres southwest of Ulaanbaatar, 280 kilometres from railhead on the Mongolia-China border at Ceke, and 35 kilometres east of the Bayan Khundii Gold Mine. The property consists of a mining license totaling 6,041 hectares. The mining license is registered to Anian Resources LLC (“AN”), a wholly owned subsidiary of the Corporation. This project was acquired from Gallant Minerals Limited in 2005.

The Zuun Mod PEA outlines a large-scale, long-life conventional open-pit mining operation, incorporating conventional crushing and grinding, feeding a concentrator process plant designed for a nominal throughput rate of 25 million tonnes per annum. The technical report incorporates an updated mineral resource for the Zuun Mod deposit, as further described below.

The base case assumes a molybdenum price of US$25/lb and a copper price of US$5/lb. All references to dollars within this release are US Dollars (US$), unless stated otherwise. The Technical Report, pursuant to NI 43-101 guidelines for the PEA will be filed on SEDAR+ within 45 days. The PEA has an effective date of October 1, 2026. The PEA 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. There is no certainty that the PEA will be realized, and mineral resources that are not mineral reserves do not have demonstrated economic viability. Key metrics from the PEA are presented in Tables 1 and 2 below.

Table 1. Key Financial and Economic Analysis Metrics

| After-Tax Economic Metrics | | Base Case | Spot Prices | | | | NPV8% | US$M | 745.1 | 1,980.7 | | | | IRR | % | 16.1% | 27.8% | | | | Payback Period | production year | 6 | 4 | | | | Pre-Production Capex | US$M | 686.8 | | | | | NPV / Capex | x | 1.1x | | | | | Capex / Total Production | US$/lb MoEq | 0.80 | | | | | Capex / Annual Production | US$/t MoEq | 59,750 | | | | | | Base Case | Spot Prices | | | | | Undiscounted Financial Metrics | Avg. Annual1 | LOM Total | Avg. Annual1 | LOM Total | | | Revenue | US$M | 630.3 | 21,431.4 | 829.27 | 28,195.2 | | Operating Costs | US$M | 314.8 | 10,704.3 | 314.8 | 10,704.3 | | Royalties | US$M | 58.1 | 1,975.9 | 76.4 | 2,598.8 | | Transportation and Treatment | US$M | 25.2 | 858.3 | 30.6 | 1,041.6 | | Sustaining Capex | US$M | 13.6 | 462.6 | 13.6 | 462.6 | | Closure Cost | US$M | - | 86.5 | - | 86.5 | | Cash Taxes | US$M | 49.2 | 1,673.9 | 93.0 | 3,163.0 | | Free Cash Flow | US$M | 146.7 | 4,988.9 | 278.2 | 9,457.5 | | Pricing Assumptions | | | | | | | Molybdenum | US$/lb | 25.00 | 33.00 | | | | Copper | US$/lb | 5.00 | 6.50 | | | | LOM Gross Revenue Contribution | | | | | | | Molybdenum | % | 78 | 78 | | | | Copper | % | 22 | 22 | | |

1. Average annual financial metrics are presented on a 100% Project basis and weighted by total mill throughput in each year, except closure costs which are incurred in the final year. 2. Molybdenum equivalent (MoEq) used in the production-based metrics is calculated on LOM recovered metal as Mo lb + (Cu lb × 0.20), where 0.20 is the ratio of the PEA base case copper price to molybdenum price (US$5.00/lb ÷ US$25.00/lb). No recovery adjustment is applied because metallurgical recoveries are already reflected in the recovered metal quantities. This factor differs from the MoEq grade factor of 0.27504 used in the Mineral Resource Estimate (note 6 to the Statement of Mineral Resources), which is applied to in-situ grades and is based on the metal price and metallurgical recovery assumptions adopted for the Mineral Resource Estimate. The two factors are not interchangeable. 3. Operating costs are presented excluding VAT. VAT on applicable operating costs (assumed 75%) and NPI capex are refunded over the life of mine, primarily during the year incurred, under existing legislation. 4. Free cash flow is stated after operating costs, royalties, pre-production and sustaining capital, closure costs and taxes.

Table 2. Key Operating Metrics

| Aggregate Operating Metrics | | Avg. Annual1 | LOM Total | | Mine Life | years | - | 34 | | Milled Mineralized Material | Mt | 24.5 | 834.2 | | Strip Ratio | waste:feed | - | 1.31 | | Grades (PEA Forecast Plant Feed) | | | | | Molybdenum | % Mo | 0.041% | | | Copper | % Cu | 0.058% | | | Recoverable Production | | | | | Molybdenum | Mlbs Mo | 19.8 | 672.1 | | Copper | Mlbs Cu | 27.9 | 947.2 | | Molybdenum | kt Mo | 9.0 | 304.9 | | Copper | kt Cu | 12.7 | 429.6 | | LOM Process Recovery and Payability | | Recovery2 | Payability | | Molybdenum | % | 88.4% | 100% | | Copper | % | 89.6% | 100% | | Operating Costs | | | | | C1 Costs | US$/lb Mo | 10.24 | | | All-in Sustaining Cost (AISC) | US$/lb Mo | 13.89 | |

1. Average annual metrics over the 34-year operating life. 2. Recovery to concentrate. Molybdenum and copper are assumed to be 100% payable, subject to a 2.5% treatment charge for molybdenum and 3.5% aggregate treatment charges for copper, both applied to payable value. Payable metal is recovered metal less an assumed 0.5% concentrate shipping loss (LOM 668.8 Mlb Mo and 942.4 Mlb Cu). Revenue, C1 costs and AISC are calculated on payable metal.

Zuun Mod Mineral Resource Estimate

As part of the PEA, Erdene commissioned SLR Advisory Asia Limited (“SLR”) to complete an updated mineral resource estimate (“MRE”) for the Zuun Mod molybdenum-copper deposit. The table below is a summary of the updated MRE at a cut-off grade of 0.025% Mo.

Table 3. Zuun Mod Mineral Resource Estimate

| Resource Classification | Tonnes | Mo | Cu | MoEq | Mo | Cu | MoEq | | Mt | % | % | % | Mlbs | Mlbs | Mlbs | | | Measured | 67.2 | 0.051 | 0.061 | 0.067 | 75.0 | 90.5 | 99.9 | | Indicated | 339.9 | 0.047 | 0.062 | 0.064 | 352.0 | 463.2 | 479.4 | | Measured+Indicated | 407.1 | 0.048 | 0.062 | 0.065 | 427.0 | 553.7 | 579.2 | | Inferred | 596.2 | 0.041 | 0.056 | 0.060 | 536.8 | 733.3 | 783.0 |

Notes to Zuun Mod Statement of Mineral Resources; Effective date May 1, 2026:

1. CIM Definition Standards for Mineral Resource (2014) is used for reporting of Mineral Resource. 2. The Statement of Estimates of Mineral Resources has been compiled by Mr. Oyunbat Bat-Ochir who is a full-time employee of SLR and a Member of the Australian Institute of Geoscientists. Mr. Bat-Ochir has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he has undertaken to qualify as a Qualified Person as defined in the CIM Standards of Disclosure. 3. All Mineral Resources figures reported in the table above represent estimates at May 1, 2026. Mineral Resource estimates are not precise calculations, being dependent on the interpretation of limited information on the location, shape and continuity of the occurrence and on the available sampling results. The totals contained in the above table have been rounded to reflect the relative uncertainty of the estimate. Rounding may cause some computational discrepancies. 4. Mineral Resources are reported on a dry in-situ basis. 5. The Mineral Resource has been constrained by mining license MV-016836 and reported above Molybdenum (Mo) cut-off grade of 0.025% within a revenue factor optimized pit shell derived using a price of US$22/lb Mo and US$4.95/lb Cu. Cut-off parameters were selected based on an SLR internal cut-off calculator, assuming an open cut mining method with 3% ore loss and 4% dilution, a Mo price of US$22/lb, an open mining cost of US $2.18 per tonne and a processing cost of US $6.85 per tonne milled and processing recovery of 83% for Mo and 81% for Cu with flotation processing to produce Mo and Cu concentrates. 6. Mo Equivalence (MoEq) calculated using: The formula used for Mo equivalent grade is: MoEq% = Mo % + Cu % * 0.27504 and assumes 83% Mo and 81% Cu metallurgical recoveries. 7. 1 tonne = 2204.64 lbs. 8. Mineral Resources referred to above, have not been subject to detailed economic analysis and therefore, have not been demonstrated to have actual economic viability.

Mining

The PEA is based on an open-pit mining operation targeting 25 million tonnes per year of feed material for the processing plant. The total plant feed in the PEA is 834.2 million tonnes at an average strip ratio of 1.3:1 (waste tonne: plant feed tonne). Approximately 74% of the PEA forecast plant feed, including approximately 16% of the plant feed scheduled during the six-year undiscounted payback period, is derived from Inferred Mineral Resources. These proportions are based on the PEA mine plan applying an economic cut-off grade of 0.0217% Mo and include mining dilution; accordingly, the associated plant-feed tonnage is not directly comparable with the Inferred Mineral Resource reported at a cut-off grade of 0.025% Mo in Table 3. The deposit geometry, grade distribution and depth support bulk open-pit mining. Mining will use hydraulic excavators in shovel configuration. Drilled and blasted material will be loaded into haul trucks, with waste rock deposited in a mineral waste facility adjacent to the pit or used to build the embanking of the tailings storage facility (“TSF”), and plant feed hauled to a crusher or run-of-mine (“ROM”) pad adjacent to the processing plant.

The PEA assumes that open-pit mining will be carried out by a contractor. Under the selected arrangement, the contractor will finance, own, maintain and operate the mining fleet, while the owner retains its staff and technical services. Drilling and blasting are also proposed to be contracted. The contractor’s ownership and financing costs for the mining fleet are included in the mining operating costs through contractor rates. The conceptual fleet peaks at 63 units between Years 7 and 13, including 33 ultra-class haul trucks, three large face shovels, two rehandle loaders, eight drills and supporting equipment. Mining employment is estimated to peak at approximately 530 people in Year 9, including owner and contractor personnel. The PEA-level cost estimate is based on scheduled mine movements and fleet requirements, with unit rates and productivities adopted or scaled from recent comparable studies. Project-specific contractor tenders and equipment quotations have not yet been obtained.

Processing & Metallurgy

The PEA contemplates a conventional copper–molybdenum concentrator processing 25 Mtpa over a 34-year mine life. The mine plan schedules 834.2 Mt of plant feed, with estimated recovered metal of 672.1 Mlb of molybdenum and 947.2 Mlb of copper (Table 2) and estimated payable metal of 668.8 Mlb of molybdenum and 942.4 Mlb of copper after an assumed 0.5% concentrate shipping loss.

The flowsheet comprises primary crushing, a covered coarse-ore stockpile and a conventional SABC to grind to P80 200 microns before the material is sent to bulk flotation. Bulk flotation concentrate is planned to be reground to P80 35 microns, cleaned and separated through molybdenum flotation to produce separate copper and molybdenum concentrates. Metallurgical testwork and recovery estimates by Blue Coast Research indicate Zuun Mod has the potential to produce high-grade molybdenum and copper concentrates with low levels of deleterious elements. In the molybdenum concentrate, Mo grade is estimated at 53.2%, with Cu and P impurities at 0.4% and 0.004% respectively. The copper concentrate is estimated to grade 27.9% Cu, with reported As, Bi, Pb, Sb, Zn, F, and Cl below indicative smelter penalty thresholds, subject to future buyer terms to be determined. These concentrates specifications appear well suited to downstream roasters and converters in the region that are understood to have spare capacity. Tetra Tech provided preliminary equipment sizing and plant layout.

Tailings are thickened to approximately 55% solids and pumped to a wet tailings storage facility (“TSF”). Concentrate thickener overflow is recycled to the milling and flotation circuits. Raw-water make-up is estimated at 0.61 m³ per dry tonne of ROM, with a preliminary range of 0.49–0.75 m³/t depending on tailings solids content given a fixed average TSF water recovery. Pressure filters dewater the copper and molybdenum concentrates.

Marketing

Molybdenum is designated a critical or strategic mineral by Canada, Australia, Japan, Korea, China and India. Industry forecasts point to a structural supply deficit, with few primary mines in the development pipeline. Asia accounts for approximately two-thirds of global molybdenum consumption. Mongolia has established molybdenum logistics and supplier networks, exporting molybdenum concentrate to China and Korea.

Capital and Operating Cost Estimates

The PEA includes a capital cost estimate prepared by O2 Mining, incorporating the process plant estimate prepared by Tetra Tech, and is consistent with an AACE International Class 5 estimate with an expected accuracy range of -20% to -50% under-estimation and +30% to +100% over-estimation. A contingency of 35% has been applied to capital costs in a manner consistent with the level of project definition achieved at the PEA stage. Initial capital is estimated at $686.8 million, including a contingency of $176.7 million, and is assumed to be incurred over a three-year construction period. Mining equipment capital is assumed to be incurred by the contract miner and is excluded from the capital costs below. Sustaining capital over the life of mine is estimated at $462.6 million and consists primarily of tailings and mineral waste management facility construction and ongoing process and non-process infrastructure capital. Closure cost is estimated at $86.5 million.

Initial capital estimates include:

Table 4. Capital Costs

| Item | $ millions | | Processing | 373.6 | | Non-Process Infrastructure | 107.3 | | Tailings Storage Facility | 29.2 | | Contingency | 176.7 | | Construction Costs | 686.8 | | Sustaining Capital | 462.6 | | Closure Costs | 86.5 | | Total | 1,235.9 |

Note: Rounding may cause computational discrepancies

Operating costs are based on the mining and processing scenarios outlined above and assume contract mining. All other activities are assumed to be owner-operated. The AISC for Zuun Mod is estimated at $13.89/lb Mo, incorporating credits for associated copper production.

Table 5. Operating Costs

| | LOM ($ millions) | US$/lb Mo | US$/t milled | | Mine Operating Cost | 4,790.6 | 7.16 | 5.74 | | Processing Cost | 4,742.6 | 7.09 | 5.69 | | G&A | 1,171.1 | 1.75 | 1.40 | | Transport & Treatment | 858.3 | 1.28 | 1.03 | | Copper Credit | (4,712) | (7.05) | (5.65) | | Total Operating Costs (C1 Cash Costs) | 6,850.6 | 10.24 | 8.21 | | Royalty | 1,975.9 | 2.95 | 2.37 | | Sustaining Capital | 462.6 | 0.69 | 0.55 | | All-In Sustaining Cost | 9,289.1 | 13.89 | 11.14 |

Note: Rounding may cause computational discrepancies

Taxation & Government of Mongolia Royalties

The PEA models taxes and royalties in accordance with prevailing Mongolian legislation for molybdenum and proposed Mongolian legislation for copper. Corporate income taxes are modelled at an effective rate of 25% on taxable income, and royalties are modelled using a base rate of 5% with a 4% surtax for molybdenum and a 5% surtax for copper, resulting in total assumed royalty rates of 9% and 10%, respectively, for molybdenum and copper.

In aggregate, the PEA estimates total undiscounted net taxes and royalties paid over the life of mine of $3.7 billion, comprised of $1.7 billion of corporate income taxes and $2.0 billion of government royalties.

The project is subject to a net smelter returns royalty (“NSR Royalty”) of 1.5% held by Versamet Royalties, subject to a buy-down provision, which would reduce this royalty rate to 0.5%. The economic impact of this royalty has been excluded from this PEA.

Opportunities and Next Steps

Value Engineering

The PEA identified several opportunities to optimize the project through value engineering, none of which are included in the current estimates. The process plant accounts for approximately three-quarters of initial capital. Competitive, package-specific vendor quotations will be sought, including direct pricing from Asian equipment suppliers, to validate equipment costs and identify potential savings.