Erdene receives significant enviro approval for Bayan Khundii gold project in Mongolia, begins early works
(Kitco News) - Erdene Resource Development (TSX: ERD) today announced approval of the Detailed Environmental Impact Assessment ("DEIA") for the Bayan Khundii gold project by the Ministry of Environment and Tourism of Mongolia.
With receipt of the DEIA approval, the company said it will commence preparatory works for the construction of the Bayan Khundii gold project.
Following receipt of the DEIA, Erdene noted it applied for construction permits for the warehouse, permanent camp, administration office and other non-process infrastructure for Bayan Khundii.
According to the company's statement, applications for construction permits for the process plant and utilities are expected to be submitted in Q1 2022, following the completion of detailed design of these facilities.
"We are very pleased to receive approval of the Bayan Khundii DEIA, achieving another significant milestone in the development of the project," said president and CEO Peter Akerley. "Although the ongoing COVID situation and the onset of the winter season require us to approach the start of construction with caution, we are laying the groundwork for full construction in 2022."
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Concurrently, the company said it is progressing procurement work and has placed orders for the comminution and elution circuits, critical long lead time items. Additionally, Erdene pointed out that exploration continues at the Ulaan and Dark Horse prospects adjacent the Bayan Khundii gold project.
In July 2020, Erdene announced the results of an independent Feasibility Study for Bayan Khundii. The Feasibility Study results include an after-tax Net Present Value at a 5% discount rate and a US$1,400/oz gold price of US$100 million and Internal Rate of Return of 42%.
The Feasibility Study envisions an open-pit mine at Bayan Khundii, producing an average of 63,500 oz gold per year, for seven years, at a head grade of 3.71 g/t gold, utilizing a conventional carbon in pulp processing plant. Production is expected to commence in early 2023 based on the current project schedule.